10 knowledge MUSTS for entrepreneurs

The word ‘knowledge’ means many things.

In 1959, in his seminal book ‘Landmarks of Tomorrow’ the management guru Peter Drucker first used the term ‘knowledge worker’. He was convinced that knowledge was a more crucial economic resource than labour, land or financial assets. If you check out the term ‘knowledge worker’ in Wikipedia it states that they are workers whose main capital is knowledge. Examples include software engineers, physicians, pharmacists, architects, engineers, scientists, design thinkers, public accountants, lawyers, and academics, and any other white-collar worker, whose line of work requires them to "think for a living".

I believe the term is broader than that and goes back to the work that Dr Edwards Deming and Joseph Juran did in the Japanese automotive industry after World War Two where they introduced the concept of Kaizen or continuous improvement. This approach recognized that assembly workers on the factory floor - the antithesis of a conventional view of “knowledge workers” - were in fact essential to performance improvement for the company.

But let’s relate this to you as an entrepreneur - what fundamental knowledge do you need to have for running your company, SME or start up?

1. Entrepreneurs must define their business vision, strategies, processes and culture (or ways of working). You must align all these with each team member to deliver objectives and bottom line results.
2. You must learn how to take action and close the gap between where you are today and where you want to be (to realise their vision).
3. You must create an environment where staff (and stakeholders) are better motivated, thus helping to bring about change and continuous improvement.
4. You must have knowledge of market conditions and how to exploit them to your advantage.
5. You should develop an understanding of your customer’s needs, wants and requirements. If you understand your customer needs and solve these your customers can become your marketing champions.
6. You should have knowledge of your competitors, their position in the market place and understand their ‘activities’ is also essential.
7. Knowledge of the local culture is also key if you are setting up a new part of your business in a country other than where you live.
8. As an entrepreneur, you should be able to manage P&L tightly, and be able to evaluate opportunities versus risk.
9. You should have knowledge of your own strengths and weaknesses, so when you start to recruit you can compensate for these.
10. And above all else, entrepreneurs need to be able to instil in others the thirst for knowledge and learning. I think that this is the lesson we learnt from the Japanese automotive industry - all employees have the capability to be ‘knowledge workers’ and problem solve, be creative and push the boundaries if they are given a supportive environment to work in where they feel needed, valued and appreciated as individuals.

In Deming’s words “give the workforce a chance to work with pride and the three per cent that apparently don’t care will erode itself by peer pressure”.