The formula of economic growth is defined as the sum of adjustment efforts to technological changes by governments, business, and their people to close the dividing gap between developed and underdeveloped countries. This formula has been used successfully by countries that know how to turn knowledge into a major element in their economy instead of the traditional elements such as low cost labor, physical capital and natural resources. To succeed, there are some pre-conditions that must be met: Good education systems, high percentage of young people with college education, a culture that emphasizes education importance, good incentives for efficient performance and good coordination between the academic system and industry. If underdeveloped countries want to have a chance to succeed in today’s highly competitive world, they can follow roadmaps from China, India and S. Korea. In these countries, knowledge economy is conceived by the education and training in technology that generates the knowledge economy (Science and technology – mostly focus on computing, information technology and the Internet). Do not confuse the knowledge economy that generates technologies with the consuming and buying of these technologies. These emerging countries have prospered and created jobs in building and selling technology products. If you only consume these products then you are only in the consuming economy that means you are losing money not making money for the economy. By having a strong education and apply these knowledge (New methods of management use of information technology, qualification of personnel) into areas such as agriculture, business, and industry these countries have experienced significant economic growth and with time all areas of their economy will be saturated with the knowledge and they will emerge from developing to fully developed countries with recognizable benefits.
What the knowledge economy need is workers whose actions reflects performance and if they do not have a specific knowledge, they can find it and as soon as it is acquired, they will know how to use it properly, appropriately, ethically and correctly. Workers do not need to be told what to do as in the traditional way where unskilled labors obey the management. Today knowledge workers need to be educated and directed so they can produce and contribute to the overall goal of the company. It is for this reason that an increasing number of companies in developed countries begin to develop knowledge management rather than people management.
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Prof. John Vu, Carnegie Mellon University
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Source: SEGVN