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 Wisdom, Knowledge Management & Leadership: Linking the Past, Present and Future
By Dr. Bruce Lloyd
Professor of Strategic Management
London South Bank University


Wisdom is considered to be the highest form of knowledge.
But what do we mean by Wisdom? Why is it important? How is it learned?
And how does it relate to the pyramid of Data: Information: Knowledge: Wisdom? And its link with Leadership?

Over the past decade, in my view, the core development in strategy has been the recognition of the importance of Learning and Learning Organisation concepts. In fact, it is increasingly recognised by organisations, individuals - and even nation states -that:

"Effective learning is the only sustainable competitive advantage".

I certainly do not find it surprising that, in the past few years, this focus on Learning has been extended into a whole new industry called 'Knowledge Management'. Obviously, if you are concerned with learning, it is natural to ask the question: What are we learning? And perhaps even more importantly: What do we need to learn? This development has coincided with the widespread use of computers which created substantial new challenges from what is known as the 'information explosion'.

In parallel with these developments, there was the influence of the Millennium itself. That event was probably the greatest learning point in human history. Never before had so much intellectual effort been focused on reflecting on - and, in theory at least, learning from - our history. That reflective learning should have started by trying to define what has been distilled into Wisdom by exploring three basic key questions:

  •  Where have we come from?
  •  What are we doing here? and
  •  Where are we going?

But does the exploration of these questions get given the priority it deserves?

Surely H.G. Wells was right when he said that:

"Human history becomes more and more a race between Education and Catastrophe."
(H.G. Wells (1866-1946), The Outline of History (1920).)

How often do we seem to be either obsessed with technology, or so focused on the experience of the here-and-now, that the issue of Wisdom appears to be virtually ignored?

Are we really focused on what is important, rather than on just what is easy to measure?

In addition, we also need to recognise that the more change that is going on in society, the more important it is that we make sure that our learning is as effective as possible. That is the only way we have any chance of being able to equate change with progress. If we want to have a better future the first, and most important, thing that we have to do is improve the quality and effectiveness of our learning.

An underlying assumption of the word 'learning' is that we are trying to do things 'better'. We are trying to improve things. We are trying to make progress. Of course, the concepts behind the words: 'improve', 'better' and 'progress' are powerfully values-driven. Organisations and individuals don’t have a problem with change, only with how we define and perceive progress.

I recognise there is a risk in expounding the concept of Wisdom that I might be seen to be supporting the view that somehow I, or we, know all the answers. That is certainly not the intention. The prime objective is to raise questions that do not appear to be asked often enough. The first step is always to start by being reasonably sure that we are asking the right questions.

If learning is critical, we then have to ask ourselves:

  •  What is the Wisdom?
  •  How do we learn it?  and
  •  How can we pass it on (more) effectively?

But what do we really mean by Wisdom? According to the Wikipedia (5/8/05) entry for Wisdom:

Wisdom is often meant as the ability and desire to make choices that can gain approval in a long-term examination by many people. In this sense, to label a choice ‘wise’ implies that the action or inaction was strategically correct when judged by widely-held values.

To acknowledge the existence of wisdom assumes order and absolute. Wisdom is recognizing the difference between good and evil and choosing what is good. To acknowledge wisdom is also to acknowledge consequences for unwise or foolish choices.

As with all decisions, a wise decision must be made with incomplete information. But to act wisely, a sage must plan a reasonable future situation, desire the outcome to be broadly beneficial, and then act.
A standard philosophical definition says that wisdom consists of ‘making the best use of available knowledge.’

Many modern authorities on government, religion and philosophical ethics say that wisdom connotes an ‘enlightened perspective’. This perspective is often defined in a utilitarian way, as effective support for the long-term common good. Insights and acts that many people agree are wise tend to:

• arise from a viewpoint compatible with many ethical systems,
• serve life, public goods or other impersonal values, not narrow self-interest
• be grounded in but not limited by past experience or history and yet anticipate future likely consequences
• be informed by multiple forms of intelligence – reason, intuition, heart, spirit, etc.”

Wisdom statements are those that appear to be useful in helping us all make the world a better place in the future. But they are only useful, if they also check out with our own experience. Of course, that relatively simple objective is not quite as easy as it sounds for at least two reasons:

Firstly, the word 'better', explicitly and implicitly, means that we are involved in considering the whole complicated subject of values that are embedded in the question: "What do we mean by 'better'? It should surprise no one that a critical part of the content of any Wisdom statement is the extent to which it incorporates judgments about values. In fact, in many ways, that is a critical part of the definition of what we mean by Wisdom. But that does not mean that all statements that reflect values can be defined as Wisdom; the extra dimension required is that they are widely accepted, and that they have 'stood the test of time’ - although that does not imply any absolute validity, only that the insights appear to work and be useful.

Secondly, it is important to recognise that in trying to 'make the world a better place for us all', we can run into potential areas of conflict. For example, making things 'better' for some people can sometimes be at the expense of making it worse for others. Much of the conflict that arises in this area is due to different people meaning different things, because they are using different time horizons when they talk about the future. Some are obsessed with tomorrow, whilst others are primarily concerned with what they perceive to be the needs of generations to come.

The traditional approach to the data/information/knowledge/Wisdom link is to see a close relationship within a pyramid that starts with data at the bottom, moves through information and knowledge to end with Wisdom at the top. In essence, there is somehow greater 'added value' as we move up that pyramid. However, this progression has a fundamental flaw, which is arises from the relationship between these four items not being linearly related, and, therefore, there is no step-by-step movement up the pyramid from data to Wisdom. The basically mechanistic progression is part of the Newtonian tradition, repackaged by the Management Science of Taylorism. In practice, the integration of all four concepts requires at least one, if not two, quantum/qualitative jumps. Information can certainly be considered a ‘higher’ form of data because it provides greater context and so greater meaning. But the transformation of information into knowledge requires the first quantum jump. A book that describes how a jet engine works is an example of information. It is only when information is actually used that it is turned into knowledge. Knowledge is information in use and, of course, it is through its use, and the feedback learning loop, that you gain further information, which then gets turned into even more legitimate knowledge.

But where does Wisdom come in? In essence, Wisdom is the vehicle we use for integrating our values into our decision-making processes. It is one thing to turn information into knowledge that makes things happen, but it is quite another thing to make the ‘right’ (/’good’/’better’) things happen. How we actually use knowledge depends on our values. Instead of moving up from knowledge to Wisdom, we actually move down from Wisdom to knowledge -- and that is how we incorporate our values into our knowledge based decision-making, as well as see the application and relevance of what we generally call Wisdom. It is only justified to consider that decisions can be reduced to a cost/benefit analysis, if it is possible to quantify all the ‘values’ elements within the equation in monetary terms. In the past values have been included implicitly, whereas today that dimension need to be made much more – if not fully - explicit. All decisions involve the integration of the economics dimensions of value, with the ethical (ie ‘right’) dimension of ‘values’.

Of course, this is a dynamic process and there is continual feedback from the experience of our actions into whether we need more information - what and how much information we need are also values influenced decisions. How values are assessed both as the ends, and means, of the outcome, is a critical part of all decision making.

In order to complete this picture it is useful to reverse the data/information/knowledge/Wisdom progression into Wisdom/knowledge/information/data and consider that it is our values/Wisdom that defines the limits of what we consider acceptable in the first place, and that decision then determines our knowledge/action priorities, which then determines what information is required, and that influences what further questions need to be asked about the data required. We need to understand these two pyramids/progressions, and how they relate to each other, if we want to understand both how we incorporate values into our decision making processes, and why Wisdom plays such an important role. Although, it does need to be recognised that the way these words and concepts have been used in the past has not always helped this process. Perhaps that is one reason why wise decision making has not been as widely practiced as we would have liked. Being decisive is easy; being decisive about the ‘right’ things is the real challenge that confronts us all. I would argue that we do (and should) start with Wisdom as our base, which then provides the framework within which to manage knowledge, and so on through the pyramid to information and data. Consequently, without an effective base at one level, it is impossible to manage effectively the next layer up. In addition, it is also useful both to see knowledge as information in use, and Wisdom as the integration of knowledge and values. This view is confirmed by the comments below:

“Data is not information. Information is not knowledge. Knowledge is not understanding. Understanding is not Wisdom.”

“ The Function of Wisdom is to discriminate between good and evil”
(Marcus Tullius Cicero)

"Wisdom is the right use of knowledge. To know is not to be wise. Many people know a great deal, and are all the greater fools for it. There is no fool so great a fool as a knowing fool. But to know how to use knowledge is to have wisdom."
(Charles H. Spurgeon)

“Wisdom is the power that enables us to use our knowledge for the benefit of ourselves and others.”
(Thomas J. Watson)

“The more knowledge we have the more wisdom we need to ensure that it is used well.”

“Knowledge is of no value unless you put it into practice.”
(Anton Chekhov (1860-1904))

Hence I hope I have established the link between Wisdom and values, and its relevance to strategy and knowledge management.

Of course, Wisdom is one thing, being wise is quite another. Being wise is certainly more than the ability to recycle Wisdom. In essence being wise involves the ability to apply wisdom effectively in practice. This issue is aptly reflected in the comment:

"Those who are arrogant with their wisdom are not wise." (Anon)

In theory at least, once we can agree on the important messages, it should not be too difficult to ensure that there are appropriate channels for the effective learning of these messages. Also, it is not unreasonable to assume that, if we have learned the right things, we ought to then be in a position to do the ‘right’ thing with that knowledge. Of course, that is an assumption and, perhaps, there are more issues in that jump from information to ‘knowledge to action’, than are normally recognised. But, if that is the case, then we probably need to revisit messages that ensure we give a higher priority to issues related to the importance of meaning and motivation in human behaviour.

For example:

"Our values are revealed by what we do, not by what we say."
"It is not enough to know what is good; you must be able to do it."
(George Bernard Shaw, Back to Methuselah, Act IV, scene 1,

This is not just an academic exercise, our future is critically dependent on what we learn and, unless this subject is given much greater attention, it is extremely unlikely that we will be involved in anything remotely like progress, however that is defined.

There is enormous scope for debate, both practical and philosophical, about the specific Wisdom items identified in this paper. It only really becomes important when we try to establish priorities which, of course, in the end, we always need to do. However, at this stage, I am just concerned with trying to encourage the debate.

In this process, I would also like to acknowledge the parallel (and overlapping) contributions of other publications, I have come across recently1.

Yet in a quick survey of eighteen books on Knowledge Management, I found only three considered the subject of Wisdom was sufficiently important to mention in the index. Apart from those mentioned above, which were not essentially knowledge management books, none gave the subject of Wisdom the importance I believe it justifies.

However, as we move further into the new Millennium, the 'Knowledge Economy' is being given more and more attention. The net result is that we are, and need to be, increasingly concerned with what is the core of knowledge, distilled through the experience of history into Wisdom, that is critically important for us to preserve and pass onto future generations?

These issues are not only important for us as individuals, but they also have a profound influence on the effectiveness of our organisations, irrespective of whether they are corporate, governmental or religious.

History does appear to shows that it is incredibly easy to ignore the learning of the experiences of earlier millennia:

"If we still have not learned the lessons of 2000 years of history, why should we suddenly start being able to learn it now?" (Anon).

Or to put that another way:

"The only lesson we appear to be able to learn from history is that we don't learn the lessons of history." (Anon.).

Many of the important messages about the state and future of the Human Race were made over a thousand years ago, in China, the Middle East and other early sophisticated societies. This should, perhaps, not surprise us, as Wisdom consists of insights that have stood the test of time, precisely because they are concerned with making statements about relationships between people, either individually or in societal context, or about our relationship with the universe as a whole.

Several years ago I started collecting what I considered to be the important quotations that contained long shelf life knowledge (i.e. 'Wisdom') that, in my view, ought to be given a high priority in what we consider passing onto the next generation through learning. In many cases there is considerable scope for disagreement over who said what. But those focused on the future, rather than the past should give priority to the message, rather than the messenger2.

Some examples of statements about Wisdom that reflect the points made above include:

"Knowledge is a process of piling up facts; Wisdom lies in their simplification."
(Martin H. Fisher)

"To know how to grow old is the masterwork of wisdom, and one of the most difficult chapters in the great art of living."
(Henri Frederic Amiel)

“Wisdom is like electricity. There is no permanently wise person, but people capable of wisdom, who, being put into certain company, or other favourable conditions, become wise for a short time, as glasses rubbed acquire electric power for a while.”
(Ralph Waldo Emerson)

"Knowledge can be communicated but not wisdom. One can find it, live it, be fortified by it, do wonders through it, but one cannot communicate and teach it."
(Hermann Hesse, (1877-1962, Siddartha ))

“Wisdom Outweighs any wealth”

“Wisdom is the intelligence if the system as a whole.”

“ Wise people through all laws were abolished would lead the same life.”

And some of the general Wisdom messages that we might like to pass onto future generations might include:

"Growth for the sake of growth is the ideology of the cancer cell."
(Edward Abbey)

"By doubting, we come to examine, and by examining, so we perceive the truth."
(Peter Abelard)

"It is easier to fight for one's principles than to live up to them."
(Alfred Adler)

"Greatness lies not in being strong, but in the right use of strength"
(Henry Ward Beecher)

And a few Wisdom quotations that are specifically related to the future:

"The farther back you look, the farther forward you see."
(Winston Churchill)

"If you won't be better tomorrow than you were today then what do you need tomorrow for?"
(Rabbi Nahman of Bratslav (1772-1811))

"Depression is the inability to construct a future."
(Rollo May (1909 - 1994))

"You must be the change you want to see in the world."
(Mahatma Gandhi, (1869-1948))

"The purpose of studying history is not to deride human action, not to weep over it or to hate it, but to understand it -- and then to learn from it as we contemplate our future."
(Nelson Mandela)

“Concern for others is the best form of self interest”
(Desmond Tutu)

"Education is your passport to the future. For tomorrow belongs to the people who prepare for it today."
(Malcolm X (1925-1965))

"I touch the future: I teach."
(Christa MacAuliffe, astronaut (1948-1986))

In recent years we have seen efforts to move people from the idea of 'Working Harder' to 'Working Smarter'. Increasingly we need to move beyond 'Working Smarter' to 'Working Wiser'. We need to move from ‘The Knowledge Society’ to ‘The Wise Society’. And, the more we move along that progression, we need to recognise that we are moving to a situation where the important issues primarily reflect the quality of our values, rather than the quantity of our physical effort. If we want to improve the quality of our decision making, the focus needs not only to be on the quality of our information but even more importantly, on the ‘right’ use of that information.

Perhaps you cannot teach Wisdom but, so far, there is no suggestion of a Wisdom gene. Hence, somehow, it must be learned. The question is how can we make that learning process more effective - on the assumption, of course, that we consider it an important thing to do?

If we want to manage complexity successfully, and make progress in the world today, we have to start by getting the simple things right. This needs to be based on more effective understanding, and use, of accumulated Wisdom. Unfortunately, all too often the problems arise precisely because we haven't got the simple things right in the first place. This includes the need for a greater emphasis on sharing knowledge, rather than the more traditional concept of 'Knowledge is Power'. And, as always, we need to start by asking the right questions.

Probably the most important of those simple things to get right is for leaders to 'walk the talk'. It is relatively easy to know what is the ‘right’ thing to do - the hard thing is to ensure that it gets done.
Indeed, why does it appear to be relatively easy to recognise Wisdom, at the same time as appear to be so incredibly difficult to be wise in practice?

The wise decision inevitably includes value judgements, beliefs and feelings, as well as thoughts. It invariably involves moral choices. Hence it is not surprising that we find that the comments we might define as Wisdom are essentially comments about the relationship between people, and/or their relationship with society, and the universe as a whole. It should not surprise us that these are relatively timeless statements. They are statements that help us provide meaning to the world about us. But what certainly surprised me when I started looking at this subject, was the paradoxical gap between how critically important this area was in all our lives, and how often it seemed to be almost totally ignored in Futurist, Strategy, or Knowledge Management literature. Another paradox is that we appear to be spending more and more time focusing on learning knowledge (or more strictly speaking information, or facts) that have a relatively short shelf life, with less and less time spent on knowledge that overlaps with wisdom that has a long shelf life. Why is that? What can we do about it?

It could be argued that one reason for the recent obsession with an information based approach is because that provides a relatively easy framework within which to get agreement of decisions. In addition, any focus on the values dimension could make decision making much more problematic. There are two answers to such views. First, values are implicitly involved in all decision making, and all we are doing is making the discussions about the values dimension more explicit which, after all, is the process that is at the core of Knowledge Management. It is through making information/knowledge more explicit that we can improve the effectiveness of our learning processes. Secondly the evidence suggests that there is much more agreement across all cultures and religions about fundamental human values (and Wisdom) then is generally recognised. This view is confirmed by both the work of the Institute for Global Ethics, as well as an unpublished dissertation by Richard Hawley Trowbridge on The Scientific Pursuit of Wisdom, which found ‘no indications of a conflict between religious and practical wisdom … and ‘little difference in levels of wisdom between women and men’. (email communication from author 01/09/2005)

Finally I come back to the point I made at the beginning. Why are we interested in the Future? The answer is, I believe, that we are concerned about trying to make the world a better place. But for who? And how? To answer both we need to re-ask the fundamental questions: Why do we not spend more time ensuring that the important messages that we have learned in the past ('Wisdom') are passed on to future generations? How do we ensure that these messages are learned more effectively? These are critical strategy questions and are at the very foundation of anything we might want to call 'The Knowledge Economy', although what we really need to focus on is ‘The Wise Economy’. This focus naturally overlaps with the greater attention being given to values related issues, and ‘the search for meaning’, in recent management literature.

I hope I have not given the impression that I know what this illusive concept of 'Wisdom' actually is? Or how we can pass it on more effectively. All I am arguing is that we urgently need to give the whole subject of Wisdom a much higher priority in management literature than has been the case is the past. It is fundamental to our understanding of ‘The Knowledge Economy’ and ‘The Knowledge Society’, as well as Strategy in general. It is at the very core of what we mean by Leadership, as Wisdom is the main way to put values into our decision-making processes. If we cannot take Wisdom seriously now, we never will. And we will pay a very high price for this neglect.

1   • The Wisdom Literature, Appendix C in First Things First by Stephen R. Covey & A. Roger Merrill, Simon & Schuster (1994), which explores the patterns, consistencies and themes that they consider represented the most validated database in all human experience.
    • Working Wisdom: The Ultimate Value in the New Economy, by John Della Costa, Stoddart Publishing Co. (1995). It strongly argues that our perceived Wisdom is the driving force behind our behaviour and that the subject is a vital part of any effective Knowledge Management programme.
    • The Wisdom of the Ages: Eternal Truths for Everyday Life, by Wayne W. Dyer, Thorsons (1998), which is a remarkable analysis of how we can live more meaningful lives by close study of the words of poets and philosophers throughout the ages.

There is no shortage of books that consider the subject of Wisdom within other contexts, including:

Wisdom, Information and Wonder: What is knowledge for? Mary Midgley, Routledge (1989, paper 1991).
Worldly Wisdom: Confucian Teaching of the Ming Dynasty, Edited by J.C. Cleary, Shambhala (1991).
Toward Wisdom: Finding Our Way to Inner Peace, Love & Happiness, Copthorne Macdonald, Hounslow Press (1993).
Working Wisdom: Timeless Skills and Vanguard Strategies for Learning Organizations, Robert Aubrey and Paul M. Cohen, Jossey-Bass (1995).
Wisdom in the Workplace: On the Job Training for the Soul, Ellen Krupack Raineri, Braino Inc (1996).
Practical Wisdom & Timely Advice, Compiled and Arranged by Richard Reed, Catawba Press (1998).
The Rediscovery of Wisdom: From Here to Antiquity in Quest of Sophia, David Conway, Macmillan Press (2000).
Wisdom: Daily Reflections for a New Era, Reynold Feldman, Saint Mary’s Press (2000).
Living Ancient Wisdom: Understanding and Using its Principles Today, Paul Devereux, Rider (2002).

2   However, sometimes, even when the quotation itself is well recognised, research shows that it was based on an earlier version, with a very minor modification. For example:

"If I have seen farther, it is by standing on the shoulders of giants".
(Sir Isaac Newton (1642-1727)).

Is very similar to a comment made many centuries earlier:

"Pygmies placed on the shoulders of giants see more than the giants themselves."
(Marcus Lucan (AD 39-65)).

And: "We are like dwarfs on the shoulders of giants, so that we can see more than they, and things at a greater distance, not by virtue of any sharpness of sight on our part, or any physical distinction, but because we are carried high and raised up by their giant size."
(Bernard of Chartres c1120 AD)

There are also situations where the generally accepted quotation can be different to the original version. For example, the Bible is supposedly the source of:

"Money is the root of all evil." when the original version is, in fact: "For the love of money is the root of all evil." (1Timothy.6:10.).

Even here, there is a precedent:

"Love of money is the beginning of evil, because the operation of evil is connected to love of money." (Pythagoras).

About Dr. Bruce Lloyd:

     Bruce spent over 20 years in industry and finance before joining the academic world a decade ago to help establish the Management Centre at what is now London South Bank University. He has a degree in Chemical Engineering and a MSc (Economics) / MBA from the London Business School. He obtained his PhD (by published work) in 1996 for his work on 'The Future of Offices and office Work: Implications for Organisational Strategy'.
     Over the past twenty years he has been involved on the Executive of the Strategic Planning Society and as a Council Member of the (now) Chartered Management Institute. He was a member of the latter's Advisory Board for a research project on 'Leadership: A Challenge for All' and was involved in a development of that project which was specifically concerned with leadership issues in the public sector.
     Since the late 1960's he has written extensively on a wide range of strategy related issues, including an article 'Leadership and Power: Where Responsibility Makes the Difference', in 'Coaching for Leadership: How the World's Greatest Coaches Help Leaders Learn', Edited by Marshall Goldsmith, Laurence Lyons and Alyssa Freas, Jossey-Bass (2000)) and more recently he has been exploring the relationship between Leadership, Wisdom and Knowledge Management.
     He has undertaken over 30 interviews with leading thinkers on leadership published in 'Leadership and Organizational Development Journal', as well other interviews for the 'Tomorrow Project Bulletin'. He was also the UK co-ordinator for ACUNU 'The Millennium Project' 1999-2005.

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