Human Resource Management in th Knowledge Economy

"Knowledge is the most democratic source of power." -Alvin Toffler "Idon't believe evolution is about survival of the fittest. I believe it is about survival of the most useful." -John Woods

hat is the knowledge economy? The knowledge economy encompasses all jobs, companies, and industries in which the knowledge and capabilities of people, rather than the capabilities of machines or technologies, determines competitive advantage. Of the 19.5 million jobs that are projected to be created in the United States from 1998 to 2008, 19.1 million of them will be in the service sector (Hecker, 2001). From retail sales to computers to biotechnology, these jobs will be more knowledge-intensive in their demands on workers and organizations. Although the service sector is an obvious place to find more knowledge-intensive work, the

ercialization of inform what is collectively known as information te 1999).The rapid development of computers and microprocessors has made it possible to collect and use vast amounts of information from a variety of sources in a more integrative an interactive manner than

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ever before. Networking and connectivity, coupled with the Internet, have made it possible for informatio toL acquired and shared globbe ally, so that pro*^ no longer d work together collaboratively: Combined, these cally altered business and everyday life. In this information-intensive egonomy, competitive advantage is based primarily on the application of knowledge, and not all of the data, intelligence, and wisdom with which a global company needs e can be found in one place (Doz, Santos, & Williamson, easingly, knowledge is dispersed around the world. Furthermore, the cost of overcoming distance is falling rapidly for commodities that are mobile, such as capital, goods, and information. Consequently, these commodities are readily accessible to firms that previously faced limitations because of their geographic location, Knowledge, rather than the concrete characteristics of goods or services or the mechanics of production processes, is becoming the defining characteristic of economic activities. The impact of knowledge is pervasive in both the "old economy" as well as the "new economy." Human know-how is a crucial component in virtually everything we produce, and it determines how we produce valued goods and services. As Don Tapscott (1996) asserts, more added value is created by brain than brawn.
Many agricultural and industrial jobs are becoming knowledge work. Already, almost- 60% of all American workers are knowledge workers and eight of ten new jobs are in information-intensive sectors of the economy. The factory of today is as different from the indus-

with software.

The knowledge economy is about adding ideas to products and turning new i eas into new roducts. Tapscott illustration.

Human Resource

There are smart clothes with chips in the collar; smart vehicles brimming with microprocessors that do a hundred new things every year; smart maps that tell a ucker's location and automatically change tire pressure according to the weather and road conditions; smart radios that store the traffic report for you when you want it; smart houses that manage energy, protect you from intrusion, and run a bath for you before you arrive; smart elevators that phone in when they're getting sick; and smart greeting cards that sing to you, Products like those described by Tapscott have six key attributes that distinguish them from acts that were avai These attributes are the following (Botkin, 1999).
1. They learn. The more you use them, the smarter they get, The more you use them, the smarter you get, too. For example, some word processing programs create customized dictionaries and automatically correct spelling errors.

. They improve with use.

ey are enhance ,rather than pleted, when used. They grow up instead of being used up. Internet banking, for example, can be customized over time to reflect a patron's transaction patterns. what you might want next. Grocery scanners use the customer's current basket of goods to automatically generate coupons on the back of receipts to stimulate future sales.

. They anticqate. hey know what you want; they recommen

sunny.

. They remember. They record an

velop a profile. Nearly every phisticated customer purchases.

1 your past actions to

net sales operation has soems to encourage related

6. They are customized. They are uniquely configured to your in-

dividual specifications-in real time-at no additional cost. Injection devices for iabetics can adjust insulin dosages spond to current blood sugar levels and activity levels. The knowledge economy has even spawned a new type of global, knowledge-based organization, labeled a "metanational" by Doz, Santos, and Williamson (2001).In contrast to global organizations that view the world as a single, fairly homogeneous market, or multinationals that see each country as a distinct segment, these metanational organizations view the world as a global Fanvas dotted with pockets of technology, market intelligence, and capabilities. Thus, metanationals are able to capitalize on the synergies of global commonalities while adapting to specialized opportunities generated by local capabilities. Metanationals see untapped potential in these pockets of specialist knowledge that are scattered around the world. And, by sensing and mobilizing this dispersed knowledge, metanationals are able to innovate more effectively than their rivals. Rather than promoting a universal set of products that are globally competitive, metanationals weave together a tapestry of many local specialized capabilities to create local customization with global reach. The complexity of this type of organization requires extensive knowledge management at all levels to achieve what Bartlett and Ghoshal (1993) refer to as "distributed entrepreneurship." Bartlett and Ghoshal argue that this explains why Asea Brown Boveri (ABB), an electrotechnical firm with worldwide operations, has turned the conventional design of its HR activities inside out to

Human Resource

anagement in the Knowledge Economy

knowledge are becomof competitiv dvantage distinguishing businesses nations. How s the knowledge economy change the way business is conducted? We will address that issue next.

What's Different in the Knowledge Economy?

However, since there is no universal agreement on specific characteristics that distinguish knowledge-based competition from other economic forms, this is a challenging task. Furthermore, there is no universal agreement on terminology. New concepts have necessitated new jargon, and some of it is more descriptive and widely acthe knowledge econo leading thinkers on this topic. First, the knowledge economy uses technology to create symbolic goods (Burton-Jones, 1999). Electronic symbols represent informato know about sical goods to conduct busiese electronic symbols-ones nication, the elivery of gover ment programs, the execution of health care, and business transac-

nagement in the Knowledge

Eleven Characteristics of h e Knowledge

Knowledge Economy Characteristic Definition

spbdic goods
Digiiization

Electronic symbols representing information about the physical goods that we need to know to conduct the transactions (for example, details of a banking transaction): human communication, delivery of government programs, execution of health care, business transactions all become based on ones and zeros. Reduced dependency on the need for phyilal concentration or massing location) of labor, materials, and money. Knowledgetranscends firm, industry, and national boundaries; organizations have time- and qmce-independence; work can be performed from a varieb of locations. Physicalthings can become virtual, such as corporations, teams, auction sides, and so on. Interconnertionswithin and between organizations and insfitutions; interconnections between businesses and customers; no one organbation can have all the knowledge needed, so padneilng is essential.

Demassification Boundaryless enterprise/ Globaiization Virtualizafion Gmectedness/ unprecedented partnering/ Integrationinternetworhng Ditintemediation Convergence

Elimination of the intermediaries in economic activi between producers and consumers.

nything that stands

Dynamic pricing are constantly updated and shifted. immediacy Business is transacted in real time; enterprises continuously an adjust to changing business conditions; produd life cycles beco

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Eleven Characteristics of the Knowledge Economy (Continued)

Knowledge Economy Clyracferistic Definition Customer communities ustomers talk with other customers on local and giobal scale (for example, Amazon.com).
Sources: Topsc~n 996); Budon-Jones (1 999); Baird & Henderson (20011 (f

ture associated with physical proxim mon in the industria Third, the knowledge economy has no define boundaries (Burton-Jones, 1999; Tapscott, 1996). Knowledge transcends even national

locations. The proliferation of PalmPilotsTM,laptops, and other connectivity technologies everywhere, from the airport to the attests to the portability of work. anage workflows t makes it possible to transform physical entities into virtual ones. A virtual corporation is one without walls

and dissolved to meet situational needs. This "unprecedented p&tnering" is neceisitated by the fact that-no single organization of the knowledge it needs to compete skcessfully n, 1999). Consequently, firms must dbeiop new"di1Is h r knowledge management activities that .capitalize on their exwith their cuspanded reach. Businesses are more inter~oqnccted tomers in ways not possible in the past.. Relationship marketing and individually targeted advertising create a uniquely "personal" impersonal relationship. It is now unusual, for example, to make a catalog purchase without being asked for your email address, so that the company can keep a customer posted on upcomin specials and new products. This suggests that the talent poo an organization is likely to include customers and employees o the firms providing raw materials and the firm's own human resources. Sixth, the middleman is (mostly) eliminated in business transactions between an organization and its customers as well as between an organization and its employees. Tapscott calls this facto termediation." It is the elimination of anything that stands producers and consumers. The erosion of travel agencies, fullservice gas stations, financial service intermediaries, and similar transaction roles illustrates this trend. This phenomenon is also oc' o ~ s ,such as Dell C curring in HR as more org Corporation, adopt electronic elivery systems. These systems allow employees and managers to get what they n they need it (and without using an HR middleman). Activities that merely transmit information or transfer objects from one location

yielded such products as "smart telephones," which can be used for talking, reading email, surfing the Internet, and so on. These flui

of competition among ecoeconomy is a nomic sectors. Rivalry is not limited to product functionality but can focus, as well, on the basic nature of the solution being offered. Consider, for example, the contest currently taking place between personal computer an microprocessor allies (such as IBM an Compaq), who intend to maintain power on the desktop, and inerface firms (suc icrosystems), move computing power to the network. Rede ed solutions mean that firms will nee fficiently develo new capabilities. Eighth, the knowledge economy increasingly operates to provide tailored products and services that meet the unique needs of individual customers. Termed "personalization," "mass consumption " or c c p r ~ ~ ~ m p t i o n , " refer to cons rs taking an active r dge, information, an in the production ideas become part the product specification process (Baird & Henderson, 2001; Botkin, 1999; Tapscott, 1996). As a case in oint, Dell Computer Corporation has pioneer mdss customizaanufacturing i this, the lines between products an s increasingly bundle services wit ucts (that is, information hotlines for everything from cookbooks to

mgement in the Knowledge

make it easy, quick, and inexpensive to comparison shop in virtua space. Moreover, the firms whose products and services. are bein cornparedhave much less control over the processxthan ever before. As a result, firms will need to develop new ways to influence consumer behavior that rely on loose ties and building relationships rather than on conventional advertising and special pricing policies. Tenth, in the knowledge economy, business is often transacted in real time, that is, there are no delays .between steps in the process. Successful companies continuously adjust to changing business conditions, and they c do so immediately. Aircraft manufacturers that have implemen enterprise resource planning systems, example, automatically initiate the production of components in their supplier's factory when an order is placed for a plane. Furthermore, product life cycles have become much shorter. Firms such as Intel routinely invest in the manufacturing capabilities that enable them to scale up production at the same time they are working on the technology bre hs that will create the next generation microprocessor. s it feels like businesses a running the fast-forward a videotape player. The spe of action in the knowledge economy means that firms must agile, resourceful, and adept at interpreting events and making sense of the environment "on the fly." Finally, the knowledge economy has create customer corn ties. Customers can talk with other customers on local and globa bases. They can talk and share information and do so in real time. Reactions from other consumers are readily available to evaluate products and services as diverse as videos and movies, nationa

Human Resource Management in the Knowledge

cono om^

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finished products to accommodate unpredictable fluctuations in demand. Furthermore, Henry Ford's mass production technology, which could produce lots of cars efficiently (as long as they were all the same kind) has given way to mass customization technologies that are so sophisticated that they can provide individually tailored products and services with the same or better efficiency as standardized production processes. Globalization is more than a meaningless buzz word; markets for products, services, and labor are truly international. People can work at home, organizations can ist in virtual reality, and industries ca fast, very fast.

How Do Organizations Compete in the Knowledge Economy?

Winners in the knowledge econo competitors on three 2001):
1. Competing on the sensing plane

ave to outdistance t

. Competing on t e mobilizing
. Competing on t

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H;clman Resoure Muwgement in the Knowledge Econowy

is called "competing on the sensing; plane," and is. much- like prospecting: It reqbires such competencies as reconnaissance and discovery, Competing on the sensing plane enables.organizationsto create the gutare,, Once useable knowledge is discovered, it must be. mobilized to and create a product. or service. Doz, Sant~s, ?iIUiilliatqsm (2001) suggest that firms create cc.magnets,". which- are oqpriizational structures that att~act knowledge from differ&t.parts o6.the corporation (and,sometimes with the help of customers) to ~en%$i locations, swhere&t~an integrated and applied. To ,achieve this, firms be must have core compe4eacies .(integrated knowledge sets within an organization that distinguish it from its competitors and deliver value to customers) to provide an effective basis for selection and assimilation (Bohlander, Snell, & Sherman, 20Q1). Pioneering new products and ser?icbs requires innovation. Creative capabilities are needed to quickly develop t& jjroducts, processes, and services that customers want at a competitive price; to find new kdutions to old problems; and to adapt familiar solutions to changing circumstances (Huang, 1998). This level of competition is called "competing on the mobilizing plane" and requires, among others, entrepreneurship and mobilization competencies. Finally, in the knowledge economy, as in the- old economy, knowledge must be operationalized to create and distribute the products or services. This more traditional level of competition is evermore fierce as organizations look for efficiencies throughout their entire value chains. Linkages among suppliers, distributors, customers, and other institutions are crucial for eliminating

competitiveness.,lust as an individual blessed with good DNA (for example, intelligen~e and athleticism) has a potential advantage in life, &at ad~antage .must be realized through deveiopment, application, ~pgo~u;ni@~, The same is true for organizatimal capabilities.

Human Resource Management in the Knowledge Economy

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Having the capabilities is a necessary, but not sufficient, condition for success. Organizations must also be able to develop those capabilities, apply them, and match them to opportunities. To sum up, competition in the knowledge economy requires succeeding on three levels: sensing, mobilizing, and operationalizing. Different competencies are needed for different levels of cornpetition. The combination of competencies needed for succeeding across all three levels is collectively known as "organizational capabilities." Human resource management plays a significant role in creating and eloping the organizational capabilities neede competing in knowledge econo

Human Resource Management's Opportunity in the Knowledge Economy

Don Tapscott (1996: 260) argues that "the human resources function in general, and uman resource professiona should be uniquely positione to provide leadershi formation of the enterprise." However, rather than being an agent of change and adaptation, the HR function is too often slow to respond. As Tapscott notes, "'Although some human resource p sionals are rising to the challenge, too many are not. The problem is that in the first era, human resource professionals were mere suppliers of human resource functions, such as staffing needs and compensation planning. c his may have made a lot of sense riod of stability and steady growth. But as we move into organization

function?

esource Management i~ $the

owledge Economy

What Is Human Resource Management Wonh?

the knowledge economy, HRM work will not conventional functions of staffing, training and development, performance management, and so on. Human resource managemem work in the knowledge economy includes both activities that overlap with other traditional business functions (for instance, finance, marketing, strategy) and some that are nontraditional (for instance, knowledge management). For this reason, HRM is no longer simply focused on "managing people9' in the conventional meaning of the phrase. Human resource management is n sponsible for managing the capabilities that people create a relationships that people must develop.

Who Does Human Resource Management Work?

HR professionals still do much of the traditional HR work, although some of that work has been outsourced (staffing, benefits, and so on) or digitized (for example, electronic HR). Furthermore, a substantia portion of conventional HRM work is now being done by line managers and professionals from other fields, such as information technology, or in other parts of the organization, such as the entrepreneurial units of ABB mentioned previously. In the knowledge economy, as HRM work expands, responsibility for HR will truly be jointly share among FIR managers, employees, and external vendors.

How Will Technology Change the Human Resource Management Function?

Human Resource Management in the Knowledge Economy

31

Twenty-one HR systems professionals logy trends affe at are in various stages o ities (Boyett et a

. Fast and cheap access to accurate real time HR information.

Access and the abili to analyze, assess, interpret, everage, and share e information effectively will Successful data mining

2. Ubiquitous access to information to improve employee effectiveness and effiiency. This means working from anywhere an at anytime. The size, format, and footprint of technology deliverable~ move fr will departmental desktop devices operati nder the full contr ser organization to a and-held, pocketated devices and wir ages that provide needed access on a real time basis to centralized processing and data storage capabilities. Instant access to all needed knowledge and to essential meaningful data will be a keystone for the successfu variety of analytics and decision trees. These expert systems will "walk" managers through every step of a decision about people issues. The information the manager receives at each

nagement itz the Knowledge

4. Smart self-service. This is self-service expanding to communicate through smart phones and handheld personal data assistants (PDAs). Much of the new Web self-service will reduce the need for call centers and most employee self-service tirely Web-based. In addition, natural language spee tion enables intuitive application to be implemented speech recognition is in the early stages of acceptance, it will be a factor in twenty-first-century self-service. For both employee and manager, self-service will have to be more intuitive than ethnology, content that is ever. This will include push relevant for the e role(s) they a forming and event driven, as well.

. Castomized content. Human resource management systems in

the twenty-first century will enable employees to perform optimally by providing knowledgeable content that has been filtered based on the employee's role(s) in the organization. The vendors of the future will provide not o systems necessary for this infrastructure come the "aggregators" of content for their customers and provide a wide range of hosting as the demand for better, faster, and cheaper technology support prevails.

Why Human Resource Management Roles

Human Resource

ent in the Knowledge

New Roles and New Challenges for Human Resour e Management

y, organizations pete in the knowle to specific funct is role-based (that tional responsibilities, as in the past) and contributes directly to the creation of organizational capabilities. Four roles are identified that make it possible to create those needed capabilities: hw steward, knowledge facilitator, relationship builder, a ployment specialist (see Table 2.2).

A recent Business Week article proclaims "The turn of the millennium is a turn ffom hamburgers to software. Software is an idea; hamburger is a cow. There will still be hamburger makers in the twenty-first century, of course, but the power, prestige, and money

In the Creative Economy, the most important intellectual property isn't software or music or movies. It's the stuff inside employees' heads. When assets were physical thi ike coal mines, shareholders truly owned them. But when the vit ts are people, there can be no true ownership (by anyone other than the individual employee). The best that corporations can do is to create an environment that makes the best people want to stay.

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Human Resource Management in the Knowledge Economy

New Roles and New hallenges for Management in the Knowledge Economy New Roles for HRM Human Capital Steward New Challenges for HRM intelledual capital is not owned by the employer bui is bought and sold in human capiil markets. Workers are volunteers or free agents. Market contrads replace (most) employment contrads. HRM must ensure that the organidion's human capital capable, effective, and grows in value. HRM must broker HR services, such as talent acquirifion, learning, and so forth. 0 HRM must leverage human capital (that is, focus on doing the right things and gaining maximum output for a given input). There is a greater dependence on key knodedge workers and ensuring they are attraded and retained. e There will be higher entry-level requirements areers replace iobs.
e

Knowledge Facibfator

There is an increased emphasis on learning and encouraging people to learn continuously. 9 There is a necessity to manage knowledge (acquidtion, dissemination, and so forth), The organizadion mud tap into all employees' knodedge as sources innovation.

obsolete behaviors. elationsMp Builder

e

There is an increased emphasis on cross-funaional t e a m r k i l Technology will make information more accessible and w ioin

Human Resource
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anagement in the Knowledge Economy

--

ew Roles and New Challenges for uman Resource Management in the Knowledge Economy (Continued)

New Roles for HRM

New Challenges for HRM

HRM must build networks and shared people communities around

the strategic objectives of the business to ensure competitiveness. The HRM function will focus externally and internally and look more like operafions management, dealing with vendors and managing the supply chain.

Rapid Deploymen Specialist

he new goal for HRM will be to manage markets, some of whic will be rapidiy changing markets. HRM will anticipate what rapidly changing product markets and business strategies will require by way of human capabilities and find ways to deliver it. Work assignments are fluid, involving responsibilityfor results rather than tasks. The future resides in the capacity to design a versatile, evolving, flexible HRM architecture that supports an increasing pace of change. The organizational infrastructure needs to be reconfigurable, that is, elements of information, business processes, and organizational design must be capable of being combined in different ways to meet situational needs. mmon purpose and core values supplant tight managerial contro sysfems and iob descriptions. Widespread sharing of organizational information is necessary.

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nagement in the Knowledge Economy

Some of the challenges facing the human resource management function as stewards of uman capital inclyde the Intellectual capital is not owned by the e and sold in human capital markets. How do you find and obtain that intellectual capital? Do you rent or purchase that intellectual capital? Workers are volunteers or free agents. How do you attract, motivate, and reta volunteers? How do you facilitate volunteers' identification with the organization? Nonprofi organizations deal with these issues on a daily HRM adapt practices from these organizations for knowledge workers in private corporations! Market contracts replace (most) employment contracts. Employment contracts are more long-term; market contracts e are more short-term and project-base needed level of commitment from w rather than employment contracts? Human resource management must ensure that the organization's human capital is available, capable, and effective, and that it grows in va ue, How do y (into, within, and out of the orga mum continuous capability? Some of the best college football

HR services that are availabl

Human resource management must leverage human capital (that is, focus on doing the right things and gaining maximum output for a given input). o you combine uman capita for maximum output? How do you combine human and other capital for maximum output? suring they are attracted and retained. How do you create a work environment that adapts to meet the needs of key workers? How do you sense and respond to the needs of key workers? requirements for employment. motivate knowledge workers? Ho for personal growth among kno edge workers? Careers replace jobs. How do you balance the need for corporate as well as professional identification and commitment? How do you create an environment that best utilizes temporary o you match t talent as long as you the corporation and the needs of temporary talent? Policies regarding proprietary information become more challenging to design. What policies should govern non-compete agreements? How is proprietary information defined and distinfrom tacit knowle ge that must be share rganization?

* There is a greater dependence on key knowledge workers and en-

Knowledge Facilitator

by other organizations make full use of a firm's product functionality. As Intel discovered, not only was it essential far itszowaemployees to share technology advances among themselves, it was equally important for firms making the software and hardware tha uses their microprocessors to incorporate new concepts into their products. Cutting-edge technology allows employees in the lower levels of organizations to seize opportunities and get breakthrough ideas to the market first. Language barriers> are eroding: Employees and freelancers anywhere in the world.wil1 soon be able to converse in numerous languages online without the need for translators. A new role for I-IRM is to facilitate drganizatiorial learning an knowledge sharing between employees, among departments, throughout the organization, and with external GO-producers. Some of the challenges facing HRM in this role include the following.
i

There is an increased emphasis on learning and encouraging people to learn continuously. How do you find people who want to learn? HOWdo you encourage employees to learn continuously? How do you facilitate continuous learning? How do you retain work-life balance with continuous learning? There is a need to manage knowledge and data actively and rectly (acquisition, dissemination, and so forth). How can e acquired and made available to those who nee it when they need it? How should knowledge be managed? What types of information systems best meet organizational needs?

Human Resource Management in the Knowledge Economy

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Human resource management must determine how to reward knowledge ac uisitionand sharing. Rewarding knowledge acquisition may be the easier challenge of the two. How do you get employees t o share knowledge that, once shared, will no longer provide them with a personal competitive advantage and will make them expendable?
4

Information must be made available and accessible to employees. How much information should be made available to employees? How do you make information available to employees? What information formats facilitate effective co munication? How do you both make information widely accessible and still retain proprietary confidentiality? New knowledge must lead to new behaviors. As David Garvin (1993) explains, knowledge is of little use unless a firm is able to adjust its actions, decisions, and relationships to capitalize on the insight. What organizational capabilities are crucial for a firm to use knowledge more adeptly, quickly, an What processes enable rapid learning, unlearning, and relearning? How can employees maintain a consistent focus for their efforts while constantly incorporating new ideas?

Relationship Builder
Along with facilitating the sharing of knowledge within an organization, another important new HRM role is that of relationship builder.

relationships among fellow employees, even rivals. The power of relationships is in creating synergy within e organization and across the marketplace. Agile combinations o

employees who have developed .relationship networks can create more value for the organization than the mere sum of their individual contributions. One of the lessons from the work on complex adaptive syste (Pascale, 1999) is that relationships hold the key to organizations resourcefulness and resilience. The ways in which people interact substantially determine the extent to which the full benefits of their capabilities are realized by a firm. Some of the challenges facing HRM in this role include the following, There is an increase emphasis on cross-functional te How do you organize optimal team structures? How do you create a whole that is greater than the sum of its parts? How do you achieve balance between individual (functional)loyalties and team identification? How do you create and dissolve project teams and sustain high performance? There is no single, correct answer. W. L. Gore and Associates rely on what they term a "lattice structure" (Shipper &: Manz, 1992) that emphasizes integration, whereas Technical and Computer Graphics (TCG) relies on a cellular form that emphasizes flexible autonomy (Miles et al., 1997). Technology will make information more accessible and join ple together in different ways. What technologies can l n people ik together? How do you train people to maximize the effectiveness of these technologies? How do you minimize communication failures? What dimensions of social capital are required to trans-

people communities ness to ensure competitiveness. How do you persuasively communicate the organization's strategic o ctives? How do you uch of your build commitment t those objectives workforce has only a partial relations the organiza-

anagement in the

tion? Kaplan and Norton (2001) suggest that HRM can use individual balanced scorecards to effectively communicate strategic themes an to gain commitment across constituencies. internally an he HRM function will look more like operations management, dealing with vendors and managing the supply chain. How do you gain the trust of other members of t ain? What infor share among members of the supply chain? How do you maxiize effectiveness an efficiency in the supply c

Deployment Specialist
The rapid pace and constantly changing environment that many organizations and industries confront creates another new challenge and new role for HRM: the rapid deployment specialist. Competitive advantage gained by bringing new products to the efore competitors variety of different ways to create value, will allow competitors to meet or exceed such advantages almost instantaneously. Rather than creating and sustaining a long-term competitive advantage that is defended ov organizations in the kno , in-and-out, guerr ties in the marketplace. Once the adva these organizations will move on to the next opportunity. Many

nagement in the Know

Fortunately, improved information technologies are available, or are being developed, to facilitate this. However, the challenge for HRM in the knowledge economy is substantial and significantly different from H century, Some of the cha lenges facing HR in this role include the following.
@

The new goal for HRM will be to manage the contributions individuals make to specific externa markets, some of yvhic be rapidly changing markets. Increasingly, HRM will need to emphasize and understan events taking place beyond the ers of the firm. Human resource management will anticipate what rapidly changing product markets and business strategies will require by way of human capabilities and find ways to deliver it: How can you anticipate what human capabilities may be needed to enact business strategies? How can you prepare human capabilities when markets change rapidiy? What mix core and contingent workers provides maximum flexibility an maximum effectiveness? Work assignments are fluid, involving responsibility for results rather than tasks. How do you define what people will do in their work assignments? How do you coordinate across work assignments that are fluid? you manage careers work assignments are fluid design effective erformance measurement the objectives are evolving?

Human Resource Management in the Knowledge Economy

43

ore values supplant tight rnanageri ions. How do you ensure you coordinate across jobs and between organizational functions? How do you achieve order without chaos? Widespread sharing of organizational information is necessary. o gets access How do you share information widely? what information? How do you prevent disclosure of propri-

onclusion
One thing is certain: "Our profession, the HRM profession, is at the epicenter of a profound transformation, We have never been so visible-or so vulnerable" {Sartain, 2001). Much like the proverial dog that es cars, we may ask, what do we do once we've caught the ca man resource anagement can eirher fai advantage of the opportunity and become less important, while other groups assimilate these new roles, or it can carve out a new territory by assuming these new roles, ones that can lead to both greater prominence an greater impact. The next four chapters deof organizations in the knowledge economy.