The future lies in innovation, people power and the knowledge economy, argues Raman Roy
Seven years ago, there was no such thing as Facebook. Today, the social networking site, created by a college student, is worth about US$5 billion. Mark Zuckerberg, the brains behind Facebook, is the perfect example of a “knowledge worker”. Entrepreneurs such as Zuckerberg possess enormous skill, but at the same time, they have learned adaptability and appreciate the importance of the fast-paced change demanded by an increasingly global consumer audience.
People like Zuckerberg have flourished because of their creativity and innovation. But there is no denying that they are also big risk-takers. Narayanan Murthy is another example. He quit his job to set up Infosys and I’m sure many people tried to dissuade him from leaving a good job. If he had listened to them, Infosys would not have been created.
India has the potential to create vast armies of knowledge workers, but the country lacks the environment to foster such talent. If Zuckerberg was in India, and he returned home from college saying that he had this great idea for a website, his mother and aunt would have told him not to be silly. In India, entrepreneurial ideas are not being allowed to blossom.
I worry that the kids today have to study so hard to get 95% grades to get into college. That 95% is not creativity. I have met a lot of those kids. They are not going to be the next Bill Gates or Steve Jobs. Their knowledge is absolutely bookish. These kids are very intelligent, but they need experience and an understanding of the real world to become better leaders, managers and entrepreneurs.
We need a balanced approach. I’m not saying let the kids go amuck, or don’t have classes in college because the college dropouts are the ones who have succeeded. As a society, we need to change our fundamental way of thinking. How many middle class homes understand the success of Facebook – not in terms of operating the site – but that a school dropout could create it?
We need to nurture an environment that puts a premium on creativity and innovation. And if anyone understands innovativeness, it is us Indians. There may be no electricity, no water and bumpy roads. But somehow we are able to figure out a way to make things work. We have to evangelize that. Creating a knowledge economy is not only about setting up schools and colleges. It’s about a DNA, a culture and an environment.
The characteristics of a “knowledge economy”, a term coined by the economist Fritz Machlup, differ from those of a traditional economy. In terms of development, a traditional economy is steady, linear and predictable, while a knowledge economy is volatile, chaotic and fast-changing. A traditional economy is supplier driven, while a knowledge economy is customer-driven. The product and technology life cycle of a traditional economy is long; in a knowledge economy it is short. A knowledge economy is driven by innovative, entrepreneurial companies, not large industrial businesses, which a traditional economy relies on. Most importantly, a knowledge economy thrives on human capital.
In a traditional economy, employees are mono-skilled and are generally considered an expense. In the economy of the future, the workforce will be multi-skilled and will be seen as a core investment for any company.
The lawyer community will relate easily to this concept. They are knowledge workers. They do not simply practise law, they use their education and capability to contribute to corporate life and add value to companies. That is what is interesting and exciting.
I must stress, however, that all great thinkers need a second, third and fourth line to which they can transfer their knowledge and skills. That is what the knowledge worker is all about. Indian law firms and Indian companies cannot sustain their operations by relying on one or a small handful of leaders. They must create a supportive ecosystem to train their employees and equip them with the expertise they need to best serve their clients.
My argument is not that manufacturing will cease. You and I will still buy cars and mobile phones. But it is the knowledge and services component on top of that which will create a lot of value.
Lawyers have a big role to play as members of the knowledge economy and as gatekeepers of what is legally acceptable. They must take the reins in drafting legislation that will affect the way the world is able to leverage the knowledge economy. They are also big influencers in the corporate world.
But before the fraternity embarks on this role, there needs to be open dialogue and debate, and that is where the media play a big role. What systems should change? What new methods will succeed? It is not easy to determine the changes required because we are heading in a totally new direction. Lawyers must focus not only on interpreting current legislation, but must increasingly debate what the legislation of the future should be in this dynamic and rapidly evolving new economy.
When the constitution of India was written, we had nothing to begin with. A few people sat down and put their heads together to discuss what kind of country and what kind of nation they wanted India to be. They were visionaries. Not every lawyer needs to be a visionary, but some within the fraternity need to understand the implications of the knowledge economy and, on that basis, initiate a debate on what that futuristic legislation will be all about.
Raman Roy is the chairman and managing director of Quatrro. Quatrro is a global services company offering business and knowledge processing services to organizations seeking higher operational effectiveness, greater flexibility and lower operating costs.