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Source: Philippe Baumard
From InfoWar to Knowledge Warfare: Preparing for the Paradigm Shift
By Philippe Baumard, Ph.D.
Professor of Strategic Management,
University of Paris-XII.
Successful firms, such as Intel, maintain an innovative environment, seek
continuous performance improvement, favor customer orientation (e.g. through
partnerships with customers and suppliers), enhance results orientation, and
place speed of creation, defense and development of value-chains at the core of
their strategic focus. To maintain its leadership, Intel developed "war rooms",
and encouraged informal relationships that crisscrossed organizational
boundaries. Nevertheless, when Intel had to face InfoWar practices, it had to
acknowledge that the company failed to prevent and to anticipate large-scale
New businesses live on the brink of disasters. Yet, "organizations have many
stabilizers but quite often lack proper destabilizers" (1). We will argue in
this paper that InfoWar (informational arena-based warfare) has been thought
within the boundaries of old schemata that will no longer be accurate in the
XXIst century. These schemata includes misconceptions of management,
organizations, economics, welfare and of purpose of development.
We will investigate, in the footsteps of Hedberg, Jonsson, Starbuck, Steele,
Wilensky, and many others, design principles that worked, and no longer worked.
Founding our comments on observations of real-world experiences, we end with
recommendations as to prepare nations, organizations and people for the
forthcoming paradigm shift: from InfoWar to Knowledge Warfare (K-Warfare).
Why Policy Makers Got Trapped in the Information Paradigm
World leaders, who mostly belong to a generation that is not born with a
computer at home, has been strongly influenced by cybernetics. In a cybernetic
world, economic and social life is seen as a system ; values are categorized ;
economic systems are modeled ; social structures are typologized, and ideologies
are invented to put all these systems together. In such a world, policy makers
are not long to assume that information is power, and systematized information,
the structure of power itself.
History has been, so far, consistent with such implicit assumptions. Power was
centralized, and, therefore, needed centralized intelligence. The world was
organized into blocks, and therefore, needed compartmented information. Economic
and social systems were hierarchical, and therefore, hierarchical information
From the starting point, this cybernetic view of the world was quite erroneous.
As Varela and Maturana pointed out (2), neurons that participate in the building
of "vision" only account for 20% from the eyes' retinas, whereas 80% of them
come from other parts of the brain. In other words, 80% of our "vision" is
internally constructed. Vision is mostly knowledge, not information.
Furthermore, this knowledge is mostly tacit ; it escapes our individual or
collective awareness (3).
Eventually, people - including policy-makers - learn without being aware of what
is being learned (4) ; code without being aware of coding (5) ; and most
dramatically, learn without having intended or planned to learn (6). Most
learning is incidental.
Emerging "Information Warfare" doctrines fail to acknowledge this fragility of
learning. Mapping without knowing is a non-sense. Mapping, as an act of
"vision", is mostly derived from these 80% of neurons, in our brains and not in
our retinas, that participate in the construction of images, and help us to
transform noticed and unnoticed stimuli into sense-making. Such weapons as
"private-sector communication satellite constellations that instantly link
individuals, on-demand high-resolution imaging spacecraft and rapidly evolving
gigabit/sec.-class networks" (7) are no less than phantasmagorias, if we neglect
to take care of these disturbing, - yet remaining -, autonomous neurons of our
A small firm of less than 12 employees, named "Indigo", is an exemplar. Indigo
produces and publishes five confidential newsletters, including the Intelligence
Newsletter (8), a well-repute source of intelligence among policy makers in
Europe. Myths and rumors circulate, seeing in Indigo's high accuracy a ploy of
obscure foreign intelligence. French readers suspect foreign intrusions. Foreign
readers suspect French manipulation. In fact, Indigo is nothing else than an
efficient "knowledge-refinery" (9), that is to say a firm purposefully designed
for the efficiency of its knowledge generation. In-site observation shows that
"far from being pliable, knowledge generates its own path of transformation,
while simultaneously transforming and being transformed by its organizational
settings. An implication is that those who would manage knowledge should respect
this propensity for autonomous development" (10). Cautious towards systematized
information gathering, Indigo's staff is operating within a "community of
practice" (11) - i.e. an intensive and highly-contextualized socialization
process -, and favors HUMINT. The whole organization is focused on sense-making
instead of information-collection. Intensity and depth of internal and external
socializations are considered as the core organizational competitive advantage.
The rate of defaults is close to zero. The overall performance, in terms of
growth and ROI, is twice higher that similar organizations such as the The
Economist Intelligence Unit.
To understand such a performance, let us remind that information is not
knowledge, and then let us investigate how to deal with knowledge, instead of
information. As general Francks pointed out, "Vietnam was the first battlefield
use of computers. The Univac 1005, which the 25th infantry division installed in
1966 at Cu Chi, filled an entire van (I) Images of the enemy and terrain were
captured with conventional cameras and television with light intensification
devices, radar, and infrared devices. Sensors and high altitude reconnaissance
scanned 100,000 square miles per hour providing commanders with a heretofore
unknown view of the battlefield" (12). Meanwhile, Vietnamese population was
digging underground tunnels. Similarly, French Foreign Legion was settling its
command outposts on hills, as to dominate battlefields, and meanwhile,
Vietnamese soldiers were digging the crops and burying themselves in the face
and "vision" of the enemyI Proving, if necessary, that neurons from the retinas
only account for 20% of vision. What was dramatically missing was not
information, but knowledge in general, and an adequate form of "knowing" in
particular. "We are on the threshold of an era where order can be achieved
largely through knowledgeI not necessarily through physical order" (13)
Knowledge vs. Information, Knowing vs. Knowledge
Understanding the differences between 'knowledge' and 'knowing' is essential to
a successful entry in this new paradigm. "One contemporary cliche is that more
and more turbulent settings are requiring organizations to use more and more
knowledge, and that this in turn forces organizations to process more and more
information" (14). A knowledge-base is all the learning of people and
institutions more or less explicitly encapsulated in minds, brains, models,
signals, culture, rules, guidelines. Greek philosophers used to categorize this
human knowledge in three ensembles : the techne, the embodied technical know-how
; the episteme, the abstract generalization derived from knowing-how, and the
phronesis, the wisdom of social practice, i.e. the ability to derive aggregates
from social learning. In modern management literature, the investigation of
knowledge within and in-between organizations is merely derived from the same
twenty-four centuries old conceptualization. The conventional view is that the
relevant knowledge comes from explicit situational analysis, i.e. it is
objective knowledge. As Detienne and Vernant pointed out (15), education in the
Judeo-Christian world has been strongly influenced by the pursuit of Truth as
the sole goal of knowledge generation. Starting in 400 BC., knowledge is
systematically understood as "objective knowledge", leaving 'meaner' forms of
knowledge and knowing, - such as conjectural knowledge -, disregarded and
low-grade. The governmental intelligence cycle itself is a pursuit of objective
knowledge. Intelligence generation is driven by an objectivation force, that
discards unreliable information and sources according to truth-setting rules.
As Wilensky put it, the intelligence bodies are overcrowded with
"facts-and-figures men", who "introduce a 'rational-responsible' bias" (I)
"Facts-and-figures men are preoccupied with rational argument and criteria;
their technical competence compels opposing parties to be more careful or honest
in their use of information, to match each other expert for expert, fact for
fact" (16). Thus, current doctrines of InfoWar are all implicitly based on a
biased assumption that large-scale truth seeking is superior to depth and
differentiation of knowing modes. Such doctrines are based on the belief that
the process of organizations and nation's 'getting into difficulties' is
essentially one of the degradation and increasing disutility of their
knowledge-base (17). Yet, when doctrine generators are asked to define such a
"knowledge-base", they have to face their incapacity to describe and to qualify
Knowledge-base, as a matter of fact, is a static concept. It assumes that
knowledge can be systematically put in the form of a representation, and
neglects all various forms of tacit knowledge in general, and collective tacit
knowledge, in particular. Thus, the same Judeo-Christian bias applies to the
representation of knowledge. Knowledge is assumed to be merely a long-term
representation ; is seen as a commodity ; is talked in terms of volume and
stocks ; is described with a vocabulary borrowed to hardware management. In such
a biased conception of knowledge, one usually distinguish short-term, or
procedural, representations that can be immediately acted on one side, and
long-term, or structural, representations, whose access and development need
several apprenticeships (18).
As a consequence, focus should be put on the advancement of "knowing", instead
of the accumulation of "knowledge". Development of national intelligence
capabilities should therefore target the improvement of interpretational and
sense-making skills, instead of pursuing the utopia of the ubiquity of a
knowledge seen as a commodity. Such a self-deception has its roots in the
reproducibility of information. Redundancy of information is a serious waste of
resources in most industrial democracies. For instance, in France, no less than
80 administrative bodies distribute to small and large businesses the same
information again and again. This redundant information eventually leads to
redundant intelligence administrations, leading to the hypertrophy of
bureaucratic, and inefficient, intelligence bodies. The 1996 reorganization of
the U.S. Intelligence Community is an exemplar of this lack of focus on
"knowing" capabilities, and of the exaggerated attention given to the
accumulation of "knowledge". In 1992, Ernest R. May "urges the Committee to
think of individuals in the Intelligence Community as well as of their
organizational boxes" (19). Frank Carlucci, a former Assistant to the President
for National Security Affairs, underlines that "Congress could render a valuable
service if it would lead the Intelligence Community through the process of
cultural change that many of our businesses have gone through" (20). As Orton
and Callahan noted, "unwarranted duplication remains a problem; and intelligence
remains too isolated from the governmental process it was created to serve"
The focus on "knowledge as a commodity" vs. the "improvement of knowing" can
also be observed in the conceptual frameworks that are judged to be a good basis
for knowledge-based warfare. Col. Steven J. Sloboda, formerly in charge of
long-range planning for U.S. Space Command asserts: "Space is literally the
fabric upon which we will weave our approach to knowledge-based warfare. Space
is the enabling ingredientI Fortunately, the convergence of our experience in
space operations, communications networking, and information processing seems to
make the move to knowledge-based warfare achievable" (22). Unfortunately, human
souls and minds are not fully readable from outer space. The "folk theory" that
trust moves not words might well be misleading in a knowledge-based paradigm.
The Vietnam, Gulf and former Yugoslavia experiences - three modern war theaters
with intensive use of satellite information - are exemplar cases of the limits
of satellite cartography in penetrating human intents. Moreover, such
experiences underline the limits of InfoWar. As Dragnich noted, the "so-called
information war" that has been proposed "to wage against the Serbs is
ridiculous. The Serbs do not need the outside world to tell them that communism
and Slobodan Milosevic are bad" (23)
Misconceptions of management
Thus, management should be designed and understood as primarily a
knowledge-generation process. Many companies tend to follow management practices
that take the physical world for granted. When the Berlin Wall fell, Finland
believed that the announced geostrategic shift would require the acquisition of
combat fighters. The market was estimated at around US$ 3 billions. Four
French companies, Snecma, Matra, Dassault and Thomson, and the Defense
Administration decide to enter the race for this competitive bid. When the newly
settled French Economic Intelligence and Corporate Strategies Commission, at the
French Office of Planning, decided to develop a few exemplar case studies, the
case of the Mirage 2000-5 was selected (24). The audit revealed that lack of
coordination and knowledge sharing was at the roots of the commercial failure.
Managers who negotiated the contract were chosen according to corporate
criteria. Internal competition prevented any attempt of crisscrossed knowledge
transfers. Another French firm, the Aerospatiale, which has an in-depth
knowledge of the Finland aeronautics market was not consulted by the competing
pool. In the absence of a long-term knowledge strategy, the State was unable to
display any capitalization of knowledge on Finland. The lack of longitudinal
capitalization of geostrategic knowledge led to the incapability of designing
required distinctive attributes in the competitive bid. In the middle of the
negotiation process, the political turmoil in Finland was perceived as an
obstacle, whereas the American companies reinforced their coordination and
lobbying to use these elections as a leverage for their offer. Indeed, the
French consortium was competing with a hypothetical F-16 offer, while the
American were proposing the F-18. As Wilensky warned, "in all complex social
systems, hierarchy, specialization, and centralization are major sources of
distortion and blockage of intelligence" (25).
However, it seems that this analysis can be put a step forward. In this
intelligence failure, the main cause was the inappropriateness of management
practices to a non-market environment. The French consortium failed to recognize
and acknowledge forces that acted outside the narrow borders of the targeted
market. In a transversal environment (i.e. that implies geopolitical,
geoeconomical, local politics, technology and society), with a transversal offer
(i.e. typically a consortium of different firms, proposing dual technologies),
traditional "market management" fails to grab critical issues. As R.D. Laing
noted, the range of what we think and do is limited by what we fail to noticeI
If nonmarket knowledge is not integrated in management duties and skills, it is
bound to be neglected. Thus, "nonmarket strategies result from a management
process that incorporates knowledge of the market and nonmarket environments,
information about specific issues, and conceptual frameworks that guide strategy
formulation and implementation" (26).
Misconceptions of organizations
Most organizations are unfit for the management and capitalization of intangible
assets in general, and counter-productive in terms of knowledge generation.
However true one "must analyze the flow of information along the value chain as
well as the movement of goods" (27), it might be quite insufficient to cope with
the new conditions of competitiveness.
The whole concept of value-chain, and the education given to managers on that
matter, should be revised. Managers and scholars are used to thinking of
organizations as stable contractual bodies, with physical locations
(headquarters, plants, departments, etc.), while the new economics call for a
focus on industries as systems, rather than buildings and walls. Bo Hedberg
introduces the concept of "imaginary organizations" to picture these new
economic conditions (28).
An "imaginary organization" is a knowledge-infrastructure concerning markets,
potential opportunities for production and creation of value-chains. Hedberg
uses the example of Gant, an American garment brand that was bought by Swedish
investors, and developed worldwide. Gant has no proprietary plants. The whole
organization consists of a team of managers that coordinate market needs and
channels with a constellation of independent suppliers. The core competitive
advantage of Gant lies in the corporation's ability to coordinate market needs
with independent systems' inputs. Gant uses its knowledge infrastructure to
define and find matches between independent production and design capabilities
and market needs.
This whole perspective of "knowledge infrastructures" is likely to be the
dominant paradigm in the coming century. Hewlett Packard in France got rid of
local middle management supervisory staff to replace it with a centralized
information platform at its headquarters. The "information infrastructure"
collects customers' needs and requests, and dispatches the information directly
to managers and maintenance engineers' notebook screens through Electronic Data
Interchange. Locally, Hewlett Packard suppressed many subsidiaries and branches.
Managers and maintenance engineers work at home, being constantly on the move to
meet customers' needs and specifications on sites. The whole organization is
transformed in a knowledge-generation node, with many peripheries where action
is taking place.
Could such a model be implemented on a national scale, and what would be social
and welfare consequences? It is quite probable that such a "knowledge
infrastructure" could be designed and implemented on a national scale. It would
require administrations, large and small corporations and individuals to share a
communal information infrastructure where demands and supplies of tangibles and
intangibles would find their matches. In such a perspective, competitive
advantage of nations would eventually lie in national ability and speed to
generate (and discontinue without social and economic costs) virtual value
chains to operate them. Attempts such as the Department of Commerce's Advocacy
Center in the United States, and the Committee for Economic Security and
Competitiveness (CCSE) attached to the Secretariat General de la Defense
National (SGDN) in France, are evidently pursuing such a model.
Both the Advocacy Center and the CCSE pursue an objective of coordination and
alertness between administrative bodies and private organizations. However,
while the Advocacy Center is located at an operational level with a direct link
with the intelligence community, the French CCSE is placed under the authority
of the Prime Minister, and its main focus is a supra-coordination of
administrative bodies (Ministries of Finances, Defense, Foreign Affairs, French
Office of PlanningI) that already fulfill, more or less properly, a coordination
role. Political ambitions, in France and in the United States, and intelligence
communities' internal conflicts, are however impeding the performance of both
the French and American experiences.
Misconceptions of economics & WELFARE
Economics theories mainly failed, for they either never succeeded to address the
benevolence issue in economic development, or rapidly lost its focus when
attempting to grab it. Myths that surround the development of InfoWar or
InfoEconomics, are mainly myths of malevolence: 'cyberwarriors', 'viruses',
'logic bombs', etc. Whereas we leave the paradigm of economics of forces,
physical order, heaviness and superiority of gender on genius, we tend to bring
with us the bad habits of past and history. InfoWar experts and analysts react
to the emergence of the 'knowledge paradigm' with a defense attitude towards the
unexpected. Whereas a global knowledge infrastructure could have been an
opportunity to substitute a threat-equilibrium with 'integrative power' (29),
policy-makers tend to project ideologies and doctrines that proved to be wrong,
instead of inventing the conceptual framework that will fit the new economics.
Two biases lie behind the design and mission of these governmental-level
information coordination bodies. The first bias could be pictured as an
"intelligentsialization" of the information infrastructure. Both governments
have chosen a top-down implementation of their information infrastructure, thus
applying obsolete governmental schemata to the management of knowledge. While
experts are calling for the development of the largest "knowledge sharing
culture" (30), national knowledge-infrastructure projects are being drawn with
an elitist buyest. It might occur, around 2010, that such decisions were
historical self-deceptions. Doing so, governments tend to confuse information
logistics (a structural perspective) with knowledge sharing (an interactionist
perspective). In other words, artificial efficiency is reached today because
decision makers and policy makers who share information already hold the
requisite knowledge to make this information actionable. Thus, it gives the
illusion that the development of an information structure is a necessary and
sufficient condition to attain a national knowledge infrastructure.
On the contrary, such a policy will prove to be counter-productive. It will
eventually create an isolated body of upper-level knowledge, disconnected with
the reality of social development and learning, and therefore, increasing the
gap between people who act, learn and talk, and people being acted, learned and
talked. Economic performance might be reached through an routinized logistics of
generic knowledge amongst business leaders, industrialists and politicians, but
social performance is already doubtful. Research findings suggest that permanent
improvement and continuous learning cannot be achieved in situations of
disarticulated socialization (31). Information infrastructures, as designed in
American and French projects, favor information exchange, including possible use
of information highways, and neglect to design proper socialization devices that
would enhance permanent and collective sense-making. Furthermore, such knowledge
infrastructures are already perceived by the population as jobs-destructive, in
opposition with almost all fourteen points of Deming'quest for economics of coordination costs, worldwide economics of scale, and the
birth of a knowledgeable elite, with privileged and discretionary access to
uprising knowledge infrastructures. Hewlett Packard was an examplar on that
point. Local managers disappeared, leaving their place to management technicians
"being acted" by electronic data interchange. Many firms, more or less
consciously, took this curve. Asea Brown Bovery (ABB) reduced its corporate
staff, after its fusion, from more than 4000 to less than 300 "global managers".
Given the fact that middle managers already live and work in suburban areas,
effect is an increasing gap between geographically-concentrated conceptual
knowledge, and geographically-dispersed procedural know-how. Instead of
encouraging a cooperative culture, knowledge infrastructures may implement a
perennial rupture between an exclusive and very small knowledgeable
suprastructure, and a very large, fragmented and desocialized,
In Deming's theory, effectiveness is derived from continuous efforts "toward the
simultaneous creation of cooperative and learning organization to facilitate the
implementation of process-management practices, which, when implemented, support
customer satisfaction and organizational survival through sustained employee
fulfillment and continuous improvement of processes, products, and services"
(33). Similar thinking can be found in intelligence history in general, and in
the XVIth century Elizabethan doctrine of governmental intelligence in
particular: "Elizabeth was intellectually the most enlightened monarch of her
time. Francis Bacon writes that she was "undued with learning," and "to the end
of her life she sets hours for readingI (more than) scarcely any student of her
time". One way to please her was to talk "In Praise of Knowledge", as Essex did
with his essay, most probably written by Bacon" (34). Queen Elizabeth I's
intelligence shadow adviser, Sir Francis Bacon, was the author of the
Advancement of Learning in 1605, and also authored an essay entitled "Followers
and Friends" in 1597. The other intelligence doctrine advisor, Sir William
Cecil, authored on his part, of a forward-looking memorandum entitled Matters
Necessary to be Done, TroublesI that all May Presently Ensue, Things Necessary
to be Considered, With Speed, with Foreboding, With Foresight, Plots and Designs
(35). Speed, consistency and sharing of knowledge-generation processes on a
large-scale base were already put at the center of national development
The difference between 16th century Great Britain and current industrial
democracies, however, is a fundamental shift from obedience to commitment of the
governed. To continue to design information infrastructures in the Elizabethan
style, is overlooking that knowledge is nowadays widely distributed.
"Cooperation, in this context, is synonymous with collaboration among different
individuals, groups, or organizations, where all entities are engaging in
noncompetitive, mutually beneficial, win-win activities" (36).
Why Shifting from I-War to K-War: A case-study
As Wilensky once put it, "information has always been a source of power, but it
is now increasingly a source of confusion. In every sphere of modern life, the
chronic condition is surfeit of information, poorly integrated or lost somewhere
in the system" (37). Roots of such failures can been found (a) in the persistent
confusion between knowledge and information, (b) on the large-scale focus that
has been given in education to cumulating of knowledge-bases vs. permanent
improvement of the diversity and flexibility of modes of knowing, and (c) in the
failure of scientists in integrating in new organizational forms and purposes,
the advancements of social cognition and collective learning. Yet, "managers are
becoming increasingly aware that informed adaptability is at a premium and to
attain it they may need different modes of organization to find and solve
different types of problems" (38). Nevertheless, and consistent with a
perception of knowledge as a commodity, "organization" on one side, and
"knowledge' on the other side, are systematically approached distinctively.
Organization theorists propose many alternatives and original organizational
forms, but leave managers with the duty of generating adequate knowledge to
operate them. Knowledge sociologists put much emphasis on the many forms of
socializations that participate in the building of cognitive skills, but are
reluctant to study how organizational design and knowledge generation interact.
German definition of the world "Intelligenz" could shed some light on such an
intricated issue. The Wirtschafts-Lexikon, a principal German dictionary, in
defining intelligence, puts "an emphasis on mental processes geared to
adaptation, integration, and recognizing significant relationships. These
processes are interesting: were we to consider them as characteristics of some
organizational form, we would come very near to the 'intelligence system'
definition (I) German thought also recognizes the importance of the perception
of causal connection and of capacity for combination" (39). To achieve the
integration of "knowing" and "organizing", German authorities have historically
put a strong focus on the continuity of education to intelligence in the
society. After World War II, the Economic Police was reintegrated in national
industrial infrastructures. Today, German students receive education from German
Generals and Senior Military Officers in most business schools as to maintain a
longitudinal awareness of the role played by intelligence and military art in
the understanding and design of business organizations.
The Perrier case illustrates the importance of "the perception of causal
connection and of capacity for combination", so much favored by German
intelligence (40). On July 3, 1989, Perrier and Pepsi Co are negotiating the
creation of a joint-venture, in which Perrier would hold 65% of the shares. The
negotiations are disrupted on July 16. In August 1989, Perrier sells its
subsidiary, the Societe Parisienne de Boissons Gazeuses, which distributes
PepsiCo in France to its main competitor, Coca Cola. This competitive move is
perceived as a retaliation. In November 1989, PepsiCo denounces the poor
performance of Perrier in the management of its license, announcing the
disruption of all contractual arrangements for December 1990. PepsiCo took
Perrier to court on November 8, 1990 ; and announced, a day after, that it would
be eventually interested in taking over the soft-drinks activities of Perrier,
if stock price would be more attractive. Meanwhile, the Coca Cola stock reached
the historical price of 72$ on November 18, 1989.
On January 19, 1990, a laboratory of North Carolina in Charlottesville
discovers traces of Benzene in samples of Perrier mineral water. Experts suspect
the information to have been transmitted through a mole in Perrier production
plant in Vergeze. "Causal connection" can be made between the test results, and
the nearby location of a Coca Cola plant. The laboratory Manager does not
remember having replaced its test equipment, but "combined" information show
strong evidence of all tests equipment being graciously replaced by a Coca Cola
sponsoring of the laboratory. On February 2, 1990, the Food and Drug
Administration warns Perrier that mineral water being distributed in the United
States contains Benzene.
At that time, Perrier is a potential target for a take-over. Nestle would
eventually be interested, and has made aggressive competitive moves on the
European market. In particular, Nestle has managed to sing an exclusivity with
Walt Disney Europe ; walking on Coca Cola traditional proprietary territory. On
February 5, 1990, the Food and Drug Administration confirms the presence of
Benzene in Perrier mineral water. On February 10, Perrier is forced to
acknowledge, but reacts very quickly by announcing that all bottles will be
withdrawn from the market. On February 12, Perrier's stock is loosing 14%.
Suntory, the Japanese distributor of the brand announces the withdrawal of
10.000 bottle cases from the Japanese market. On February 14, German authorities
forbids Perrier mineral water on their markets. The French Commission of Stock
Operations (COB) announces an investigation on suspicious stock movements that
occurred on February 9. Sales are stopped in the United States, Canada, Japan,
Germany, Switzerland, Denmark and Hong Kong.
The InfoWar could have found its end in this last event, but Perrier held 25% of
the American sparkling waters' market, with an annual sales of US$ 500 millions.
Perrier reacted with great dexterity facing such an Info-Destabilization.
Financial markets' observers were promptly reassured on the integrity of the
natural water source. The human error was fully explained with a worldwide
dissemination of accurate counter-information. Sanitary authorities announces
the results of scientific investigations: "The daily consumption of half-liter
of Perrier during 30 years do not increase the risk of cancer". The Perrier
stock gains 6.3% on Paris stock exchange.
The second phase of this large-scale InfoWar arises on February 20, 1990. A 36
years old Athenian woman asks Perrier 7,5 millions Francs for the damage caused
by the explosion of a bottle that supposedly led to the loss of her eye.
Evidence shows that the incident occurred on August 25, 1986, that is to say
four years before. Several similar court cases appear in different places of the
globe : a lawyer in Bridgeport defends Mrs Vahlsing ; eight similar cases of
Class Action appear in Connecticut and Pennsylvania. Perrier discovers that
Kroll, the investigative consultancy that took care of its information in the
United States, has withdrawn key-information from its reports (41). In 1991,
Nestle finally took over Perrier.
Very similar cases of InfoWar, such as the Shell-Greenpeace Brentspar's case, or
the case of "benzene threat" for Octel Co. Ltd in the United Kingdom (42), lead
to the same conclusions : (a) an isolated organization cannot cope alone with
large-scale Info-Destabilization without considerable loss ; (b) successful
large-scale InfoWars involve interorganizational agreements, and collective
manipulations of worldwide information infrastructure (mass media, scientific
institutions, customer groups, etc.), and most importantly, (c) ability to
rapidly make sense (i.e. generating knowledge) is superior in counter-fighting
InfoWars than systematic collection and compilation of open information, already
coming from a corrupted or contaminated information infrastructure.
Preparing for the K-Paradigm
Sweden might be an examplar of a country that already engaged in the preparation
for the paradigm shift towards Knowledge Warfare. In 1977, Dr. Stevan Dedijer
started its business intelligence course at Lund University, educating and
training many graduate students that would later become the men and women in
charge of economic intelligence in such groups as Skandia, Volvo, or Ericsson.
The latter company has organized a strategic group with the university of
Karlstadt that investigates strategic issues of long-distance education and
information highways. Participants of this group also participated in the 1992'
Swedish Ministry of Defense seminars on the application of the C4I2 to strategic
development. In a well-defined and well-applied strategy, another strategic
group that put together economic, social, political and military leaders, such
as Lars Hallen, the head of scientific attaches, Bjorn Wolrath, AB Skandia CEO,
Goran Pagels-Fick, from Ericsson, Peter Nygards, State Secretary for Industry
and Jan Foghelin, head of the Defense Research Center (Fosvarets
Forskningstantalt) (43) started to build an "economic intelligence community"
among business leaders in 1991. Originally named "BISNES" (after Business
Intelligence and Security NEtwork of SwedeN), on a proposed idea from Dr.
Dedijer, the network adopted a more discreet strategy by inviting for large
debriefing sessions economic intelligence thinkers and leaders of the open
world. General Pichot-Duclos, the head of Intelco, the French InfoWar and
Economic Intelligence think-tank, was among the early guests of these sessions
with businessmen, the academia, and the military.
Sweden also holds the first rank in systematized intelligence activities in
large companies in Europe (44). Observations of Astra-Draco, Electrolux,
Ericsson Radio, Gambro, Celsius Tech, Skandia, SCA Graphic, SAS, Telia and
Volvo, as compiled by Hedin, show a good balance between strategic and
operational objectives, a systematic supply-and-on demand intelligence for
corporate management, a focus on information-sharing culture (e.g. systematic
community meeting around the BISNES network), and a particular focus on
knowledge acquisition processes (45). What can be learned from the Swedish
First of all, Sweden knowledge infrastructure do not seek publicity. Proceedings
of the first open conference on Swedish nation-scale economic intelligence were
not translated, and not available on any Web servers, although Sweden displays
one of the highest rates of electronic information and telecommunications in the
world. While Sweden is claiming to be behind with the knowlege warfare agenda,
young Swedes can do their military service in economic intelligence activities.
Second, the Swedish experiment is culture-driven. Information-sharing is for
long a cultural practice among expatriate Swedes. Emphasis is put on a culture
of knowledge sharing, rather than on the constitution of specialized
administrative bodies. Third, the core of the Swedish knowledge infrastructure
is not hardware-based, but it is a "community of practice and sense-making". The
BISNES informal network meets regularly, and sense-making is a communal and
face-to-face process. Sweden, however, has favorable conditions that could be
hardly met by other countries. It is higly culturally-homogenous, and its
population is less than 10 millions. The level of reading is, with all
Scandinavia countries, one of the highest in the world.
"Making the simple complicated is commonplace; making the complicated simple,
awesomely simple, that's creativity" (46). Preparing for the knowledge warfare
paradigm requires a strong focus on reengineering of the whole education process
of industrialized democracies. This is that simple, but policy makers will face
strong resistance, especially from academics. Integration of strategic issues
assessment should be put as early as possible in education. The current process
is cumulative. The required process is interactionist. Instead of thinking of
education in terms of sequentiality, policy makers should design education in
terms of interconnectivity and interoperability. Many organizations would like
today to increase the awareness of strategic issues among their engineers'
population, and vice-versa, to increase the awareness of technological issue
among their commercial task-forces. To do so, they design new systems,
centralized economic intelligence units that dispatches technical of market
information to both communities. Some firms, like Intel, encourage hybrid teams
of engineers and managers as to fertilize crisscrossed issues. This is a result
of a Taylorized learning and knowing. Emphasis should put on judgment, cogntivie
skills, cognitive flexibility, incongruity and ambiguity tolerance at the
youngest age. In the knowledge warfare paradigm, strategic advantage does not
lie in the concentration of facts-and-figures, but in the complementarity and
singularity of the brains who interpret them. National widespread sense-making
capability matters more electronic information highways.
1. Bo Hedberg, Sten Jonsson, 1978, "Designing semi-confusing information systems
for organizations in changing environments", Accounting, Organizations and
Society, Vol. 3, No. 1, pp. 47-64.
2. F.J. Varela, H.R. Maturana, 1994, L'arbre de la connaissance, Paris:
3. H. Helmholtz, 1867, Treatise on Physiological Optics, Vol. III, translated
from German by J.P.C. Southall (Ed.), 1962, New York: Dover.
4. E.L. Thorndike, R.T. Rock, 1934, "Learning without awareness of what is being
learned or intent to learn it", Journal of experimental psychology, Vol. 19, pp.
5. L. Hasher, R.T. Zacks, 1984, "Automatic processing of fundamental
information", American Psychologist, 48, pp. 1372-1388.
6. J.G. Jenkins, 1993, "Instruction as a factor of incidental learning",
American Journal of Psychology, Vol. 45, pp. 471-477.
7. W.B. Scott, "Information Warfare demands a new approach", Aviation Week &
Space Technology, March 13, 1995, p. 85.
8. http://www.indigo-net.com/intel.html. Archives since 1992 are available in English and French on the Net.
9. J.S. Brown , P. Duguid, 1991, "Organizational Learning and Communities of
Practice" Toward a Unified View of Working, Learning and Innovation",
Organization Science, Vol. 2, No. 1, pp. 40-57.
10. W.H. Starbuck, in the preface of P. Baumard, 1996, Organisations
deconcertees. La gestion strategique de la connaissance, Paris, Masson.
Forthcoming: London, Sage, 1997.
11. J.E. Lave, E. Wenger, 1991, Situated learning. Legitimate peripheral
participation, Cambridge: Cambirdge University Press.
12. General F. M. Franks, Jr., "Winning the InformationWar: Evolution and
Revolution", speech delivered at the Association of the U.S. Army Symposium,
Orlando, Fl., February 8, 1994, in Vital Speeches of the Day, Vol. 60, Issue 15,
13. General F.M. Franks, op. cit., p. 456. It is noticeable that Harry Howe
Ransom's "Strategic Intelligence" article (1973, General Learning Press), when
using the Viet Cong guerilla as an exemplar, and using an intelligence estimate
NIE 143/53-61, "Prospects for North and South Vietnam", dated 15 August 1961,
does not mention the existence of the Vietnamese underground logistics, and
suspects the "Bloc to build up the eastern part of south Laos, improving the
roads, mountain trails, and airfields, as a major supply channel" (p. 7). This
is an exemplar of applying a cultural mode of knowing that projects ethnocentric
schemata on a singular reality.
14. W.H. Starbuck, op. cit,
15. Detienne M., Vernant J.P. (1978), Cunning Intelligence in Greek Culture and
Society, translated by J. Lloyd, Atlantic Highlands, NJ: Humanities Press.
16. H. Wilensky, 1967, "Organizational Intelligence", in The International
Encyclopedia of the Social Sciences, David L. Sills (Ed.), Vol. 11, New York:
Macmillan & the Free Press, p. 321.
17. J.C. Spender, Ph. Baumard, 1995, "An empirical investigation of change in
the knowledge leading to competitive advantage", Research Paper, presented at
the Academy of Management Annual Meeting, in Vancouver, August 5, under the
title "Turning troubled firms around: Case-evidence for a Penrosian view of
18. J.F. Richard, 1990, Les activites mentales, Paris: Armand Collin.
19. Ernest R. May, statement before the Senate Select Committe on Intelligence,
4 March 1992.
20. Frank Carlucci, testimony before the Senate Select Committe on
Intelligence, 4 March 1992.
21. J. Douglas Orton, and Jamie L. Callahan, 1996, "Important 'Folk Theories' on
Intelligence Reorganization", The International Journal of Intelligence and
Counterintelligence, Volume 8, No. 4.
22. W.B. Scott, 1995, "Information Warfare Demands New Approach", Aviation Week
& Space Technology, March 13, p. 86.
23. Alex N. Dragnich, "Containing Serbia", letters to the Editor, Foreign
Affairs, November/December 1994, Vol. 73, No. 6, p. 198.
24. The final report under the presidency of Henri Martre, and co-authored by
Ph. Baumard, Ph. Clerc and C. Harbulot, was published by La Documentation
aise in Februrary 1994, under the title Intelligence economique et
strategie des entreprises. The Mirage 200-5 case study was withdrawed from final
25. H. Wilensky, op. cit., p. 323.
26. David P. Baron, Fall 1995, "The Nonmarket Strategy System", Sloan Management
Review, p. 75.
27. T.A. Stewart, 1995, june 12, "The Information Wars: What you don't know will
hurt you", Fortune, p. 119.
28. Bo Hedberg, Imaginary Organizations, forthcoming, New York: Oxford
University Press, 1996.
29. For developments on integrative power, see Kenneth E. Boulding, Three Faces
of Power, London: Sage Publications, 1990.
30. See Ph. Baumard, " Guerre Economique et Communaute dUIntelligence ", La
Revue Politique et Parlementaire (Political and Parliementary Review), Paris,
January 1992 ; Ph. Baumard, Strategie et surveillance des environnements
concurrentiels, Paris: Masson, 1991 and Ch. Harbulot, La machine de guerre
economique, Paris: Economica, 1993.
31. J.C. Spender, Ph. Baumard, op. cit. ; I. Nonaka, H. Takeuchi, 1995, The
Knowledg Creating Company. How Japanese Companies Create the Dynamics of
Innovation, , New York: Oxford University Press.
32. W.E. Deming, 18986, Out of Crisis, Cambridge: Massachussets Institute of
Technology, Center for Advance Engineering Study, pp. 23-24.
33. J.C. Anderson, M. Rungtusanatham, R.G. Schroeder, "A theory of quality
management underlying the Deming management method", Academy of Management
Review, 1994, vol. 19, No. 3, pp. 480.
34. S. Dedijer, 1989, "British Intelligence: The Rainbow Enigma", The
International Journal of Intelligence and Counterintelligence, Vol. 1, No. 2, p.
35. Quoted by S. Dedijer, op. cit, p. 83.
36. J.C. Anderson, M. Rungtusanatham, R.G. Schroeder, op. cit., p. 483.
37. H. Wilensky, op. cit., p. 331.
38. Dale E. Zand, 1981, Information, Organization and Power. Effective
Management in the Knowledge Society, New York: McGraw-Hill, p. 58.
39. F.T. Pearce, and S. Dedijer, February 1976, "The Semantics of Intelligence",
Research Paper, Lund University, p. 11.
40. Ch. Harbulot, P-J. Gustave, November 1995, "La contre-information ou comment
repondre une attaque", Cahiers de la Fonction Publique et de l'Administration,
No 140, pp. 11-13.
41. Source: M. Najman, 1995, "Intelligence economique", a special television
broacast, Strasbourg: Arte (Franco-German Television).
42. D. Knott, "Views conflict on benzene threat", Oil and Gas Journal, May 23,
1994, p. 41.
43. Source: The Intelligence Newsletter, march 7, 1996, "First large public
conference on economic intelligence in Sweden", No. 283.
44. H. Hedin, 1993, "Business Intelligence Systems: systematised intelligence
acitivities in ten multinational companies", The Journal of the Association of
Global Strategic Information, pp. 126-136.
45. Lars Bengtsson, Jessica Ohlin, 1993, "Strategy Formation and Knowledge
Acquisition Process", in Larsson et al., Research in Strategic Change, Lund
Studies in Economics and Management, 21, Lund University Press.
46. Charlie Mingus, 1977, "Creativity", Mainliner, 21(7), p. 25, quoted by W.H.
Starbuck and P.C. Nystrom, 1981, "Designing and understanding organizations", inthe Handbook of Organizational Design, Vol.1, Oxford University Press, p. 9.
Asst-Professor Philippe Baumard is the former Secretary of the Comission of
Economic Intelligence and Corporate Strategies, 1993-1994, placed under the
Authority of the French Prime Minister. He co-authored the Committee Report that
led to the creation of the Committee of Economic Security and Competitiveness
(CCSE), placed under the authority of the Prime Minister of France, and located
at the Secretariat General de la Defense Nationale (SGDN). Dr. Baumard authored
4 books on organizational and the strategic management of knowledge, including
Puzzled Organizations, forthcoming by SAGE Publications (London, New York) in
1997. He is intensively traveled, and participated in the first open economic
intelligene conference held in the People Republic of China in october 1991. He
also gave speeches on the issue of national knowledge strategies in Saudi
Arabia, Hungary, Japan, Hong Kong, and at the Open Sources Solutions symposium
in Washington in 1993. He is a consultant and corporate staff trainer for
numerous large corporations, including Fortune 500s. He is former Visiting
Scholar of New York University, the University of Technology, Sydney and Oxford
Philippe Baumard, Ph.D.
Professor of Strategic Management,
University of Paris-XII.
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