Our most valuable assets

Information about money has become almost as important as money itself

This famous remark, was formulated in the 1970s, now inscribed in the lobby of New York’s Library of Science, Industry, and Business. Walter Wriston was a true visionary. The former banker was regarded as the kingpin of modern American finance.

The basis for wealth has evolved from land to labour to information. We are witnessing the third great revolution in the history of the world. First came the Neolithic revolution in agriculture. Then the industrial revolution. Now we’re moving to an information society. Where the power is shifting. Today, intellectual capital is at least as important as money capital and probably more so. The problem is, that we don’t book-keep intellectual assets. But the market values it. The marketplace is capitalizing intellectual assets, while the accounting profession is not. That’s why Microsoft has a higher market value than e.g. GE.

The exchange of information has also gone through four revolutions. We are now in the midst of the forth great revolution. First came the ability to communicate through speech. The spoken language was the first great information exchange revolution. This was the first time that we could reproduce information. Even though it also meant, that the original message was gradually transformed every time it was exchanged (the feather-and-the-hen syndrome). Already now, we saw the first signs of the importance, value, and power of information and knowledge. In those days the shamans were the most powerful and respected individuals, because they had the knowledge about how to communicate with all the worlds, the upper, this, and the lower world. And they could read all the signs in nature.

Eons later came the ability to communicate through a written language. Now we could exchange information without the context of the original message being changed. This is also meant a shift of power. With the written information, the shamans power evaporated, and instead it was transferred to the issuer, and to some extent the holders/keepers of the information. The Jewish, Christian, and Islamic religions are all an example of this. But also the Roman empire was built on the ability to send written information to all corners of the empire. The power of reach had increased compared to the information distributed via the spoken language.

In the 15th century came the third great revolution. The printing revolution. This was the first time that we could reproduce information at a relative low cost. It is no coincident that the spread of the thesis of Martin Luther had such great impact only years after Gutenberg’s invention. The printing revolution also paved the way for other revolutions. Once again we saw a shift in power. This time from the issuer to the information itself. The power of reach was multiplied, and because of this, the effect of the information was also multiplying.

The fourth revolution is the Internet revolution. Once again the power of reach has multiplied. The Internet revolution has all the features of all the previous revolutions in regards to information exchange: one-to-one, one-to-many, many-to-many, and many-to-one. But the most important elements of this revolution is interactivity and availability. It’s an Any Time World, and it’s Real Time. Sure we have seen both interactivity and availability before. But not on the same time and not on the same scale. The magnitude of reach and spread can now be compared to a biological process. The small world effect, which states that any two humans on the planet are linked with no more than six degrees of separation, is also changing. The degrees of separation is decreasing as more and more are getting connected. So how does this impact on the value of information, when information is available to almost everybody?

Once again there’s a shift in power. This time from the information itself, to the knowledge of how to manage the information. Not so long ago, the access to privileged information was limited to but a few. But not so anymore. With Internet, CNN, and all other information channels, the playing field has changed again. Like in the super-bowl, everybody in the arena has the same access to what’s going on. We might have different views of reference, but we have the same information at hand at the same time. So what then makes a winning team? It’s all about the ability to provide:

THE RIGHT INFORMATION TO THE RIGHT PERSON AT THE RIGHT TIME

We could call this Information Management. It is also what it boils down to when the quarterback makes his play. It’s of no use if a spectator on the 14th row in the B section knows what to do with the information at hand, if the quarterback doesn’t. It’s the decision he makes that’s important. And that decision is based on his level of skill, knowledge, and experience, also known as talent.

So the value of the information is in fact increased when we provide it to THE RIGHT PERSON AT THE RIGHT TIME. This leads us to the conclusion, that apart from the information itself,Time and Talent are the really critical resources. They also posses some common features, they can’t be reproduced and they can’t be recycled (at least not yet). When they are gone, they are gone. Wasted time and talent are gone forever. Their level of uniqueness are extremely high.

So when we combine the uniqueness of time and talent, with the abundance of information, we are creating even higher values. And the longer we can retain that unique talent, the higher value it will generate. In other words, we should opt for time and talent monopolies. Michael Jordan is an excellent example, he created such time and talent monopoly for the Chicago Bulls and himself. He created what I call a high level of uniqueness.

Of course, some might argue that, if we have a well defined and documented process, we will leverage the impact caused by time and talent. But I say no! Only to a very limited extent. Not even the most well documented process or text-book example, will ever compensate for the lack of talent and time. Every athletic coach in the world knows this. A game plan is out dated as soon as the ink has dried on the paper. And if you don’t have the time and talent to execute the plan, it doesn’t matter how many shelves of plans you have.

So if Information about money has become almost as important as money itself, then Information Management is the most strategic issue within any organization. But how do we quantify the value of information? Well, if you play on the horses, every horse is assigned an odds, and that odds will determine the value of the information depending on which horse is winning. The odds is actually an indicator of the level of uniqueness.

Picking the right horse is a form of Information Management. And the better you are at picking the high odds winners, the better the return. So Information Management is all about providing: The Right Information to the Right Person at the Right Time. And the Right Person could also be expressed as the Right Talent, or the right organization with the right talents.

But how do we quantify the value of Information Management in the world of business? Is it the market value, the profit margin or what? It all depends. It could be the market value or the profit margin or both. All depending on what kind of stakeholders we are.