The knowledge economy is dead — or at least in terminal decline — and a new and different world is emerging. Although commentators use different terms to describe the caring, sharing, experience or emotional economy there appears to be significant agreement on two things:
· The thinking (knowledge) economy has passed its use by date
· A feeling, or touch, economy that involves people and their relationships is emerging
But what does an ‘emotional economy’ mean for you and your leadership?
Emotionally aware individuals will play a leading role in the near future, as increasing complexity and technology contributes to the emergence of an ‘emotional economy’ to replace the knowledge economy.
Four key forces are underway that are contributing to this shift:
With increasing technological capability fewer people will be required to produce what we require to run our lives, and we will be able to spend more time doing human interaction type tasks and less time doing intellectual tasks which can be automated. Much functional work will be done by AI, and the remaining core staff in a business will be focused on caring for customers, tailoring services to each specific individual and their needs. These employees will be highly skilled and trained in emotional intelligence.
The outcome of this will be an emotional economy, which will place far greater premium on care — the ability to meet the needs of others in a way that is emotionally engaging and fulfilling. Leadership will be a core competency for every employee, and will be vital in every successful role. People who cannot lead themselves before leading others will find it hard to obtain meaningful work.
The emotional economy will encourage a distinction between the transaction and the transpersonal. Real value-add will occur person to person as basic transactions are automated. This will enable a range of choices about the level of interaction a customer wants and how much they will pay, with some choosing to pay a premium for human interaction. This is a market opportunity that few appear to have recognised, given the tendency to downsize organisations, automate interactions, and use logical rather than emotional measures.
In a knowledge economy we say people are our greatest asset, endeavour to manage by objectives, and use words like ‘mind share’, and value. In an emotionaleconomy we recognise that relationships are our greatest asset, manage by meaning, and use words like ‘heart share’ and purpose. Leadership is more about character than vision, and successful organisations focus more on social contribution than profit.
In a knowledge economy personal value is directly related to how much you know, how much you can create or generate, and the quality of your judgment — in short the ability to acquire and apply knowledge. But the digital revolution is completely disrupting work. Computers will do most of the work currently done by knowledge workers. And this could be you. Is your job at risk? You will spend less time doing intellectual work and more time engaging with people.
Therefore, the ability to deeply empathise, to apply emotional know-how, and to reach out and touch people will be the new source of wealth. Your personal value will be the size of your heart, not the size of your ideas.