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People with Knowledge Are a Company’s Assets
26.03.2008 ob 08:06By consulting the historical overview of the business systems development, we find an increasing importance of knowledge, new ideas, and enterprise. In production, new ideas and creative work are becoming a critical factor, along with the awareness of the necessity of abandoning all that is obsolete – not only products and technologies, but also old ideas, outlived concepts, obsolete methods, ideologies, and paradigms. Otherwise, it would be impossible to reduce the tendency toward entropy within a business system. This can be avoided only by controlling the relevant data - the knowledge, therefore, that pertains to an actual problematic situation.
Thus, knowledge is the most valuable component of every business system. The co-workers employed in this system are the carriers of knowledge that is the essential part of its entire assets. Therefore, failing to renew the basis of its company’s skills by not investing in the people and their knowledge is the biggest of all the possible mistakes a management can make.
The more turbulent the environment, the bigger the need for independence of the business systems in which individual entrepreneurs with sufficient knowledge for controlling environmental challenges operate. Naturally, this increases the importance of entrepreneurship as a production factor and of a person as an asset.
The transition from the notion of people as a cost towards awareness that people represent assets more than anything else also exposes the issue of a worker as the carrier of knowledge and enterprise instead of regarding him/her as a mere carrier of a driving physical labour force. But as soon as we perceive labour force as creative potential that embodies innovative power, it quickly becomes clear that it is no longer suitable to speak of surplus labour force, but merely of a deficit in the entrepreneurial energy that could apply this potential constructively.
However, the existing company economics controlling the opinion of influential people within companies still considers a person as one of the production generators, whereby his work as a production generator is generally accounted for only in its physical aspect. Creativity, independence, cooperation, enterprise, innovation are the notions that a company’s applied economics is not acquainted with even though they are necessary for innovation and innovative business, and consequently, success and long-term development. In the economics of a company as a science and as a practical activity, people are still seen merely in terms of cost. Even such valuable and significant company investments as investments in education represent a cost and are not evaluated in terms of turnover. They are an item in the expenditure section of the income and expenditure account and never constitute a part of the income statement.
This is the case – in spite of the entrepreneurial and economic experts’ assertions in which they point out that human knowledge is the most powerful driving force in the production (Marshall, 1987), that a company cannot be regarded as complete without the people, and that the essence of all economic activities is the human ability to think, feel and want (Loebl, 1980). And finally, that economy will persist only as long as these specific and unique human qualities do.
Urška Č.
Summarised from “Podjetništvo in management malih podjetij” (Entrepreneurship and Small Business Management), Prof. Dr. M. Rebernik et al.
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