The New Organizational Wealth: Managing and Measuring Knowledge Based Assets

Published by Berrett-Koehler San Fransisco, March 1997. ISBN 1-57675-014-0
Price in USA: US$29.95.

Read reviews by Bill Godfrey Web Trax and by Rebecca O. Barclay,  Knowledge Management Associates, Inc.
Auf Deutsch
En Portuguese
Nu in het Nederlands!
The New Organizational Wealth is nu ook beschikbaar in het Nederlands,
uitgegeven door Uitgeverij Contact Amsterdam, onder de titel: "Kennis als Bedrijfskapitaal", ISBN 90-254-1651-9.

Now also in Korea! The New Organizational Wealth was in August 1999 launched in Korean language by Mirae Management Development Institute and Maekyung Business Newspaper in Seoul. Contact Dr. Yong-Koo Kim, for ordering.
During 2000 to be available in Chinese and French Languages.


The book is available in management book stores. You can also order it from the Publisher Berrett-Koehler or via Amazon.com. For fast service in Australia I recommend Woodslane in Sydney.  Email karl-erik@sveiby.com with your comments!

Content Summary

The New Organizational Wealth: Managing and Measuring Intangible Assets gives practical advice and examples of how companies succeed by employing strategies that focus on the intangible rather than the tangible assets. The book also features the Intangible Assets Monitor, a set of indicators, with definitions and examples how to calculate and interpret them. It is the first practical management book on how to achieve increasing returns with a knowledge focus. The book tells how to measure intangible assets. It gives definitions of indicators and examples how to calculate them. It gives examples how they are used today by Scandinavian companies.
The book is written by the "originator of the Scandinavian Community of Practice" in the field.

"It is rare to find someone who can write about an exciting new topic with both first-hand business experience and real depth of understanding. Sveiby gives us an extremely practical and yet deeply reflective start in this exciting new topic." Dr Charles M. Savage, President Knowledge Era Enterprises, Inc., and author of Fifth Generation Management.

If you manage teams of smart, productive and creative people you need this book. Sveiby´s concepts and tools for measuring and managing knowledge and knowledge creation are excellent. He opens the door to a new set of concepts central to understanding, valuing, and investing in their capabilities for your company." Glenn Osaka, Group General Manager, Commercial Systems Business Unit, Hewlett-Packard.

A review and very good summary by Bill Godfrey can be found by clicking here!

The book:

Content Detail

Despite a lot of "hype" in the last few years, few managers understand the fundamentals in how to make a business of knowledge. Common errors are: focus on explicit knowledge, information, instead of the tacit human knowledge, invest in IT instead of in people and measure performance in financial terms. Errors like these are made because managers are still caught in the mindset of the industrial age.

By contrast, managers in some of the fastest growing and most profitable businesses, focus on knowledge, see their businesses from a knowledge perspective and act as if their intangible assets are real.
By freeing themselves from the mental strait-jackets of the industrial age, some of these pioneer managers have found, by accident or by intuition, a wellspring of limitless resources arising from the infinite human ability to create knowledge, and the convenient fact that unlike conventional assets, knowledge grows when it is shared. In the knowledge era, the intangible revenues people can generate are far more important than the tangible money they cost.

The book outlines the differences between information focused and knowledge focused strategies.
Information focused strategies are just Taylorism dressed up in silicon. They are risky, winner-takes-all markets, and the strategy leaves the company open to copy-cats. They are not impossible, but few companies will succeed by adopting them in the future. I show why some companies (like Microsoft) have achieved short-term success with information focused strategies, and how some (like McKinsey) employ knowledge focused strategies for long-term success. Only if you focus your strategy on knowledge will you be able to exploit the well spring of unlimited resources, which emanate from the intangible assets of the company.

Knowledge focused strategies are relatively "intricate", in that they require both an intimate knowledge of knowledge and a willingness to empower people. Properly applied, they offer a multitude of options to differentiate oneself. They are less risky and difficult to copy, because they build on people´s unlimited ability to create unique (tacit) knowledge.

I show in detail how some firms are succeeding by understanding how to create revenues from their intangible assets and how some have failed, by disregarding them. Examples and cases are from my own experience in the Swedish media industry, as well as US and UK professional services firms and software companies.
The book outlines a conceptual framework, which divides the intangible assets into three: External Structure, Internal Structure and Competence of the personnel. I go through how to manage each one of them in the section Managing Intangible Assets. The section features a number of rules-of-thumb for the manager.

The second section Measure Intangible Assets features a tool-box for measuring intangible assets based on the conceptual framework. It describes how Scandinavian companies have used the concepts and indicators outlined in this book to monitor their operations for many years.
A number of indicators are defined with examples how to calculate them. A generic presentation format, the Intangible Assets Monitor, is described.

New Contributions

The realization that intangible assets are the primary assets of a corporation is a relatively new phenomenon. The change in attitude stems from the rapid growth of knowledge organizations. 50% of USA´s 500 fastest growing companies are knowledge organizations.
So far, very little has been written about how to manage knowledge workers, knowledge organizations and how to measure performance when the knowledge flow is more important than the money flow. Most of it is visionary, rather than practical. This is the first book that is practical for managers.
It is also the first book which addresses the issue of managing tacit knowledge instead of information, and tries to be practical about it. It is also the first book to combine both managing and measuring intangible assets.