The Demise of Knowledge
Rick Nason, PhD, CFA
Rick Nason, PhD, CFA, is a Partner at
RSD Solutions, a risk consultancy, and
an Associate Professor of Finance at the
Rowe School of Business at Dalhousie
University, Nova Scotia, Canada.
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Introduction
Once you know the notes to sing, you can sing most
anything. So, sang Julie Andrews as Maria in the classic
movie The Sound of Music. Taking the Von Trapp chil-
dren on an unauthorized outing into Salzburg, Governess
Maria teaches the children to sing by teaching them the
Do-Re-Me song which includes the above line. It is one
of the signature songs from the iconic movie, and it is
quite likely that you are now humming the catchy tune
in your head as you read this line. While it is undoubt-
edly true that once you know the notes that you can
sing most anything, the question becomes does know-
ing the notes allow you to create music like Rogers and
Hammerstein (who created the musical The Sound of
Music)? Does knowing the notes give you a better appre-
ciation of music? Does knowing the notes allow you to
create value and enrich your life and the life of others
and society? Is the value in knowing the notes or what to
do with them? Ultimately, is the knowledge of the notes
all that valuable or useful?
In a world of wristwatch computers, Google searches,
Wikipedia, YouTube videos, smartphones, smart homes
and offices, big data, robots, social media, MOOCS
(Massively Open Online Courses), machine learning,
and many other devices and systems that have largely
appeared since the mid-1990s, it is astonishing the
amount of data, information and knowledge that we
all have readily available within seconds of our need-
ing it or coming up with a question. For example, an
Internet search for if you know the notes to sing gave
me 6.7million references to the Do-Re-Me song and the
Sound of Music within 0.47 seconds on my computer
much longer than it took me to type in the question that
I was looking for the answer to. So it begs the question, if
knowledge is so readily available, then what is the value
of it?
We are currently living in a sea of knowledge that
would have been unimaginable even 10 years ago. Yet, as
business professionals we seem obsessed with obtaining
more knowledge and the credentials such as university
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 The Demise of Knowledge
degrees and professional certifications that
assures the world that we possess such
knowledge. However, are we maximizing
the value and the use of this knowledge?
Is there too much emphasis on the knowl-
edge and as a result too little emphasis on
putting the knowledge to use or the intan-
gible skills that cannot be digitized? Do we
as a societyas business managers, as edu-
cators, and as individualsneed to rethink
how we deal with being in an infinite sea
of knowledge? Perhaps it is time for a para-
digm shift in our beliefs around the value
of knowledge given the changes that have
occurred in our knowledge technology.
Drowning or Swimming in Knowledge?
Basic economics teaches us the law of sup-
ply and demand: the greater the supply of a
product, the lower the price or value of that
product. In todays information age, knowl-
edge is de-facto available in infinite supply.
Thus, according to the law of supply and
demand, the value of knowledge should be
virtually zero. This is obviously not true, but
only to the extent that the knowledge that
one possesses can be processed or refined
to a higher order or a valuable use. Yet, the
increase in school budgets, and continually
rising higher education enrollments, along
with the exponentially increasing costs of
higher education and the plethora of cor-
porate training courses and webinars have
seemingly created a disconnect with the
law of supply and demand when it comes
to knowledge.
As late as the 1980s, a high school
diploma was generally thought sufficient
if one wanted to have a business career.
Furthermore, a university degree almost
always assured success, but the prover-
bial PhD driving for Uber has laid waste
to that notion. It is now assumed that an
undergraduate degree is insufficient and
an advanced degree, or a professional certi-
fication, or increasingly common both, are
now the necessary ante to a professional
managerial career and success in life. The
bar for the amount of knowledge one needs
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to function successfully in the information
age has unquestionably been raised in the
mind of the general public. But it can be
argued that knowledge as a basis for com-
petitive advantage is a losing game.
Celebrated American author Kurt
Vonnegut aptly illustrated this point in his
1952 novel Player Piano1. In this very pre-
scient novel, Vonnegut outlines a future
time when digitization of knowledge has
led to computers and robots making deci-
sions and manufacturing all goods to such
an extent that there is a minimal need for
laborers or even managers. The only citi-
zens that have jobs are those with a PhD,
and even then their main functions seem
to make sure that critters do not lead to the
malfunctioning of the machines and com-
puters by eating through cables and such.
The highly futuristic novel in 1952 does not
seem so far-fetched in the context of today.
Geoff Colvin makes a similar point in his
book Humans Are Underrated: What High
Achievers Know That Brilliant Machines
Never Will.2 In our current age of digi-
tized knowledge, Colvin claims that the
response to the question of what can peo-
ple do better than a computer or a robot is
nothing. Colvin argues that if you are in a
knowledge-based profession that you can,
and likely will, be replaced by a computer
or a robot. It is no longer the science fiction
of Kurt Vonnegut, but the reality of today.
Knowledge can be digitized, and with digi-
tization comes computers, autonomous
machines, and robots.
Alan Turing, the brilliant mathemati-
cian who is considered by many to be the
grandfather of the modern computer and
whose role in cracking the German Enigma
code during World War II was dramatized
in the movie The Imitation Game, cre-
ated a thought experiment about people
versus computers. In the Turing Test, an
observer is placed in front of two curtains.
Concealed behind one curtain is a human
and the other curtain is a computer. The
Turing Test is to see if by asking a series
of questions if the observer can ascertain
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 The Demise of Knowledge
behind which curtain is the computer
and behind which curtain is the human.
Increasingly, computers are winning this
game in that they can produce results that
are comparable to a human. A currently
running television advertisement turns
this notion on its head by making fun of
the confusion of a customer who believes
a call from their banks call center is being
made by a computer when in fact it is a
human calling.
This principle of the Turing Test applies
not just to individuals, but also to compa-
nies and in fact to industries. The knowl-
edge economy is leading to a new wave
of paradigm busting companies disrupt-
ing whole industries by leveraging the
knowledge inherent in digitization, com-
puterization, and social networks in new
and novel ways. The competitive advan-
tage of companies and industries based
on knowledge is being severely limited.
Furthermore, this trend is likely to accel-
erate with the proliferation of low-cost 3D
digital printers. The ability to have the
wide spread dissemination of the digitized
knowledge needed for self-manufacturing
of products and parts has the potential to
dramatically change the economic dynam-
ics of design and manufacturing. The com-
parative advantage of the knowledge of
how to build something will be severally
diminished.
If knowledge is key, then there should
be a strong correlation between success in
schoolwhich is totally based on knowl-
edgeand success in life. The question of
whether or not grades are a good predictor
of success has been studied at length in the
academic literature.3 Although there are
significant philosophical issues in studying
this questionsuch as how do you define
successthe results are that there is essen-
tially little to no correlation between grades
and success. The only thing that grades
seem to be a reliable predictor of is further
success in school, and even then the corre-
lation is not as strong as one would expect
it to be.
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The plethora of sources of knowledge
that todays generation has grown up with
does not appear to be helping their acquir-
ing and mastering knowledge. A discussion
with faculty at almost any university will
involve a conversation about how the ability
of students to function at a university level
seems on an unending downward trend.
On paper, students appear to come into uni-
versity with better academic backgrounds
supposedly benefitting from better teach-
ing methods and technologysuch as the
Internet and computer-guided courses
yet, the anecdotal evidence is that they are
less prepared for university than were pre-
vious generations. Students ability to rea-
son, to think, to ask insightful questions,
to debate, to challenge ideas, and to com-
municate their own ideas seems to have
eroded. Furthermore, even the knowledge
of basic facts is significantly diminished in
the opinions of most professors. Students
come in with more knowledge, and more
access to knowledge, but less of an ability
to retain it and more importantly less abil-
ity to utilize that knowledge. Perhaps, the
most assiduous result is the students apa-
thy toward critically filtering their access
to information and knowledge. Not only
can Johnny not read, but it appears that
Johnny has less desire to read!
To follow on from this, it appears the situ-
ation does not get rectified in university as
the anecdotal evidence from employers of
university graduates says that students are
not prepared for the workforce. The claim
is that their complex problem-solving skills
are too low, their communication skills are
insufficient, and their creativity is lacking.
It can be argued that with all of our knowl-
edge and technology, we have become so
focused on acquiring the tools of knowl-
edge that we have eroded our ability to use
knowledge.
The Paypal cofounder and leading Silicon
Valley tech-investor Peter Theil has taken
this perceived shortcoming of the educa-
tion system to impart useful knowledge
into its graduates to an extreme by offering
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