Mother Nature has equipped all creatures with an Information – Knowledge – Wisdom pyramid as basic survival software.
Even though the boundaries between them are oftentimes hazy and the three occasionally get mixed up with each other, a simple example will clarify; Information about basic life sciences helps a person acquire Knowledge in Med school and become a surgeon. Wisdom is knowing when not to operate!
Wisdom is actually application of Information and Knowledge, tempering those with Experience and Judgement to visualize various possible outcomes, like images in a kaleidoscope. And then choosing the best …. or the least worst.
But Information and Knowledge are by definition historical whereas in most business situations Wisdom needs to be applied going forward. Extrapolations based on the past is like driving by looking at the rear view mirror. Wisdoms is about seeing ‘around the corner’ anticipating trends and developments before others do and taking action.
Everyone knows about India’s fascination with gold and jewellery. For hundreds of years jewellery business was all localized, family owned and highly fragmented. There were hundreds of thousands artisans working in the backroom sweatshops while hereditary sarafs managed designing, selling and running the day to day business. There was virtually no standardization or quality assurance and customers depended on the word of the trusted jeweller.
By the mid 90’s a young, affluent, educated, aspirational upper middle class was emerging. The internet was in its infancy but the dot com boom portended an information explosion. Xerxes Desai of Titan jumped in where most angels would have feared to tread. Tanishq was launched in 1994 (“Tan” means body + “Ishq” meaning love) and challenged the established traditional family jeweller system. They set up professionally managed design studios and a state-of-art production facility spread over 135,000 sq ft (12,500 m2) in Hosur, Tamilnadu.
They spread awareness about ‘purity of gold’, introducing innovations like Karatmeter rather than the traditional touchstone the lay customer never understood. And launched a marketing campaign that positioned the Tanishq brand as fashionable, modern, sophisticated and ‘cool’…..or as they claimed, “….to bring a fresh perspective to the intricate, time-honoured craftsmanship of each meticulously hand-woven creation”!
Today Tanishq has over 160 bespoke stores spread across 80+ cities and revenues of almost Rs 10,000 crores.
A farsighted CEO needs all related Information and Knowledge - and then bring Wisdom based on own instincts and experience to bear on what should be done. Or sometimes what should not be done!
In 1998, Kodak had 170,000 employees and sold 85% of all photo paper worldwide. Within a few years, their business model disappeared and they were bankrupt. Few know the market leader for high-end specialty colour photo paper in the 80s and 90s was a Swiss company that catered to a very profitable niche. I worked in that Company and was witness to a very professional and impressive Project Report made out by the Head of the Specialty Photo Papers Division in the early 90s for a large expansion to meet forecasted demand.
The Chairman not just turned it down but actually decided to divest the business! “You’ve seen the dot-matrix printer; that’s the future. Following Moore’s Law the scope and quality of home printing will improve dramatically and all professional colour printing will be done on small printers at home or in the office. Let’s sell the business while we are still at the top”. Was done at a great price …. and the Company that bought it closed down in 5 years!
There used to be a rough ‘balance’ between Information and Knowledge until a few years ago. Information was ‘power’ and managers sometimes withheld it to wield authority. Some confused the two and projected Information as Knowledge. The advent of internet changed all that and suddenly the pyramid became hugely broader at the base with almost an infinite amount of Information now available with a few key strokes. On the face of it this seems to have flattened the pyramid – but that’s not so.
While surgeons’ mistakes end up buried (or cremated!) or perhaps translate into learned papers to be presented at Conferences, the Wisdom of a CEO is constantly under unrelenting scrutiny of subordinates, peers, share- and stakeholders, regulators, media, but most importantly – own Conscience!
Wisdom – at the top of the pyramid – is perhaps the toughest to comprehend. While Knowledge can be tested – and we’ve all been through many exams – Wisdom cannot be. Its impact is prospective. It’s fitting behaviour and actions to align those with specific situations, overarching goals, often conflicting priorities, availability of resources, societal needs, ethics and a lot more.
A good CEO knows the success of the corporation depends on good people, has the judgment to find the right ones for the jobs at hand – but needs Wisdom to leave them alone!
Most look for people that are their own mirror images; Wisdom lies in picking those that are different and bring complementary capabilities.
An effective CEO has access to all Information – usually far more than necessary, is often well qualified with Knowledge – at least in some chosen field – but needs to exercise Wisdom to set the right metrics of success. A great CEO combines aggression with humility; aggression to challenge the status quo, identify, create and exploit new opportunities, and yet have the humility to accept some decisions will go wrong and have the grace to own up, correct and move on.
An insightful CEO has a clear Vison for the corporation - but needs Wisdom to know that without proper ‘execution’ it’ll probably remain nothing more than a hallucination.
Wisdom lies in knowing all battles are not worth fighting for – and making a tactical retreat when the hillock cannot be captured. Good Generals know that, not all CEOs do.
And finally, Wisdom lies in understanding no one comes out clean in a mud fight….and refrain from starting one.
Let’s hope the new CEO moving into Bombay House brings Wisdom along with his phenomenal Knowledge and an exceptional track record to restore India’s largest and most venerated conglomerate to its original glory.
Guest Author
The author is a New York-based independent marketing consultant
