KNAPP: I will focus on the second point first. I believe that this is the first major world economic transformation that we have to address globally. Before we think about taxing information industries—which are predominantly in societies that did well in the industrial age—and potentially hampering the ability of that portion of the economy to uplift the other portions of the economy, I think we should look at the intricacies of the whole balancing act and think long and hard about it.

EDWARD FEIGENBAUM: What is the situation now with chief knowledge officers? How many companies have them? How have companies wrestled with the question of valuing knowledge assets for their assets and liability statement?

KNAPP: I have only been a chief knowledge officer since Monday. It was announced in the Wall Street Journal. I happened to be in Europe, so I did not get to read it, but I do not know a lot yet about who my colleagues are. I know that both McKinsey and Hewlett-Packard have chief knowledge officers. Coca-Cola has a chief learning officer, with roughly the same set of responsibilities. There are perhaps a half a dozen companies that have this title, not all in the services sector.

To address your second question, Skandia Corporation has, for the past three years, produced an intellectual asset balance sheet as a supplement to the annual report of the corporation. By far, Skandia and the Canadian Imperial Bank of Commerce are in the forefront of this field in terms of quantifying and measuring intellectual capital on an annual basis, and representing to the shareholder the fact that its valuation is as critical as financial capital valuation. Balance sheets that have to do with intellectual assets are as critical as balance sheets that have to do with financial capital assets. To my knowledge, Skandia is the only corporation today that produces these mirror-image balance sheets. I think you will see many, many more in the coming years.

MISCHA SCHWARTZ: You mentioned the need for a science of complexity. A previous speaker also alluded to some basic knowledge in systems complexity. It seems to me this may be something we cannot really do. Those of us who have been around a long time remember something called systems science that people worked on many years ago. The National Science Foundation had programs. I worked on something called "urban system analysis." It all fell apart. Even a system like the AT&T network fails occasionally. AT&T executives have been saying for years, "It is a shame we do not understand that complex system, simple as it is." Now you start putting people into it, is there really a possibility here?

KNAPP: There is a baby step that I think could be taken and has desperately been needed for many years. This is to get out of professional-academic, stovepipe-discipline problem solving. Even if we do not understand complexity theory and the science of complexity, we do understand team-based work. I do not know that universities do, but I do know that corporations do. If we could get some interdisciplinary, team-based work under way and energized within the university environment, I think that these teams could do some spectacular things that real-world people really need.

DAVID CLARK: I look at the Web, and one of the things the Web did was sort of "dis-intermediate" access to a wide variety of information. It may be information you think is valuable. Maybe it is not knowledge specifically. Maybe it is Joe Twiddle's home page, but at least one of the conclusions is that we have had a hard time selling this stuff for money. A lot of people are giving Web pages away free and hoping they can hide the advertising in there.

I am wondering if there is a possibility, in the long run, that we will succeed in making it possible for humans to have direct access not just to information, but to knowledge. At that point, you will not be able to sell it; the marginal cost of selling it is zero because there are not any humans in the loop. So there is not any value there. One possibility is that the whole market is doomed. Another one is that you think the product is the generation of knowledge and not the resale of it. Do you make most of your money creating knowledge or selling it multiple times? If you are going to sell it multiple times, do you think you can make any money at it, or do you have to sell it at zero marginal cost?

KNAPP: That is a very interesting question. We had an earlier speaker who passed on the question. I have some thoughts that I would be happy to share with you after the session.

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