Posted by Jefferey Bridges on August 07, 2002 at 00:18:10:

In Reply to: Re: Role of Roles in Determination of Success and Values of KM posted by TMalik on August 06, 2002 at 22:27:13:

From our prior discussion (including Akhil's comment about Van Gogh's painting), it is apparent that success and value are both dynamic constructs that vary over time and contexts. The link between intrinsic and extrinsic may not seem apparent in the realm of hard numbers, however the psychology of the market that may create success and possibly value of apparently 'trivial' products (and vice-versa) cannot be denied. The same rationale may be applicable not only to pet rocks and beanie babes as well as to the now-bust overhyped dot-coms whose primary objective was to 'collect investors money' (more on this in the Fast Company debate on 'Built to Last', 'Built to Flip', and 'Built to Work' - there was some discussion on these themes earlier on these forums quite a while ago). Couple of interesting reads that relate these issue to the context of stock markets include Riding the Millennial Storm about the renowned 'Super-Bear' Marc Faber aka 'Dr. Doom' or the "Winner's Curse".

The issue about more consumption resulting in greater increase in knowledge holds water only when taking both extrinsic and intrinsic into account (this is a whole area of focus by itself and you will find related discussions on the archives of this forum and possibly in some articles accessible from this site). Another, perspective is that of 'increasing returns' and 'network externalities' that work sometimes but did not pan out for many of the dot-com companies worth billions now selling their stocks for less than a dollar.

Let me respond to your question with another question: Does any kind of management foster business success? Or does any kind of management promote value in business? (You may like to think various kinds of management(s) such as HRM, financial management, technology management, patent management, waste management, and... use your imagination). Reflect upon the success stories of companies that have either ceased to exist or are on the brink of extinction... the simple answer is that 'value' and 'success' are in the eyes of the beholders (stockholders, stakeholders, analysts, reporters, regulators). As long as you connect and relate to the 'powers that matter', you would be able to achieve both success and value... although humans are fickle by nature and often 'herd instincts' defy the models of rational behavior... until the tide turns.

Of course, for the 'game' to be sustainable, everyone needs to have some share of 'success' and 'value' that are generated. Think, if the dot-com bust had not happened, how many 'gurus' or 'analysts' would be talking about the death of the 'new economy' or the 'tech bubble'. Incidentally, "after the fact", it is just too easy even for the kind of Jack Welch's to argue that there is nothing called 'old economy'. Sages are those who can see the future, a future that most others blinded by the current 'fad' or 'fashion' of (real or superficial) success or value cannot see. If the Enron or WorldCom stocks would have continued to enjoy the (real or superficial) valuations that they once had, who would have thought that they were not the "most successful" and "most valuable" companies. The travesty is that most quant models of "measuring" success and value are based upon "what we know"; however when impacted by "what we do not know" all such models are "blown to bits" and the 'blame game' starts if any players come out as big winners or big losers. As long as most concerned players share the ride on the 'gravy train', everyone wants to overlook even major goof-ups... if we study the history of stocks... we will see the same stories of tech-bubble bursts, same stories of analysts that mislead everyone, and same stories of top Chiefs being put into prison... it all happened about or decade or so ago... and is happening again.

Bottom Line: The "extrinsic" often constitutes the rationalization of what is often "intrinsic", and that seems to apply to all the various roles that are listed in the above explanation. One may even tend to suggest that in times of huge "extrinsic" influences, those who are guided by "intrinsic" may often come out 'truly' successful and valuable - see more on this in the Amazon.com top business best-seller (which has there been for a while): Good to Great - continued discussion beyond 'Built to Last'.

Best,

Jefferey Bridges

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Follow Ups:

• Re: Measures of Success and Value in Extrinsic and Intrinsic Terms TMalik 06:53:01 08/07/02 (0)

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