From Traditional Leadership to Knowledge Leadership: Features of the New Role in the Knowledge Economy

Prepared by the researche 

• djokhdem Moussa / Amar Telidji University – Laghouat
• BendJeddou Abdelkader Mohieddine Djilali / Ziane Achour University – Djelfa

DAC Democratic Arabic Center GmbH

Journal of Human Resources Development for Studies and Research : Thirty Issue – October 2025

A Periodical International Journal published by the “Democratic Arab Center” Germany – Berlin

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Abstract

The contemporary world is witnessing profound transformations due to the rise of the knowledge economy, which is now based on creativity, innovation, and human capital, rather than its traditional reliance on material and natural resources. In this context, the need to redefine leadership has emerged, as traditional leadership based on bureaucracy and hierarchical control is no longer sufficient to meet the demands of change and complexity. Leadership has shifted to a knowledge-based approach, whose core value is empowering individuals, promoting organizational learning, generating knowledge, and utilizing it in decision-making and achieving sustainable competitive advantage.

Knowledge leadership is characterized by its ability to direct intellectual capital, stimulate innovation, and build networks of interaction and knowledge sharing within and outside the organization, unlike traditional leadership, which focused on discipline and compliance. Leaders in the knowledge economy are also responsible for creating a dynamic environment that stimulates knowledge exchange, encourages informed risk-taking, and fosters mechanisms for continuous learning and critical thinking. Therefore, the shift from traditional leadership to knowledge leadership represents a shift from a focus on “control and management” to “empowerment and inspiration,” reflecting the new role of leadership in a rapidly changing economy characterized by increasing reliance on intangible assets. This paradigm shift is essential for ensuring organizational sustainability and enhancing their competitiveness in a global environment driven by innovation and the digital economy.

Preface:

The capital of theinstitution now consists of the sum of physical assets and human assets (intellectual capital).  However, the increasing role of intellectual capital in the age of knowledge has made it necessary for the leader to pay greater attention to the crucial element in the age of knowledge. In this case, it is logical that the role of the leader should change in response to the requirements of this modern era (Schlieckertand Lehner, 2020,p47). In general, the set of new roles that can directly contribute to organizational excellence can be identified as including the following roles through this research paper:

1. Defining the future vision:the primary role of a leader is to create the future vision of the organization. The vision is “a comprehensive and broad picture of what the leader of the organization wants his organization to be” (Madkour, 2018,p92). From this perspective, the leader is the one who develops the strategies necessary to create value for the consumer and achieve profit at the same time. However, setting the future path and determining the future vision is not sufficient in itself. Rather, creating a firm desire among subordinates to achieve this vision is an integral part of the new leadership roles required to achieve performance excellence.
2. Establishing the values of excellence:Instilling the values of excellence in the hearts of employees is an essential task to achieve excellence in performance (1995,George and Weimerskirch). A leader who cannot instil the values of excellence in the present will only achieve failure in the future. Jack Welch’s role in identifying excellence as one of GE’s core values may have led to unprecedented organizational results in the company’s history.
3. Supporting excellent behavior:leadershiphas an important role in ensuring excellence by reducing the number of regulations and laws that restrict outstanding performance. Instead, outstanding organizational behavior is supported by self-esteem, mutual trust between the leader, employees, and good role models.
4. Human Resources Development: The leadership is responsible for developing human resources through several methods such as profit sharing, delegation of authority, recognition of sincere efforts aimed at achieving excellence, and updating and developing the capabilities of employees.
5. Achieving stakeholder goals:A leader deals with many stakeholder groups such as shareholders, consumers, employees, competitors, suppliers, and governments (Daft,2014,p39). and each of the other parties. Shareholders, for example, want to make the highest possible profit, at the lowest possible cost, while employees want to get the highest possible pay, with the least effort possible. The main task of leadership in this case is to manage this conflict between the goals of different stakeholders in a way that does not affect outstanding organizational performance.
6. Asserting responsibility towards society: modern leadership has an important role not only in achieving the interests of the organization, but also in achieving the goals and interests of society as a whole. Many organizations are subject to many environmental changes such as (social pressure groups) to push them to carry out their social responsibilities and responsibilities. The role of organizational leadership has become increasingly important in affirming the role that business organizations should play as“good citizens”with rights and duties. It is usual to see many business companies currently conducting social campaigns to raise money to treat some diseases or eliminate some unwanted social phenomena. ) Certo,, 2020,P74).

2:Personality traits of leadership:

The personality traits of a successful leader can be identified by comparing the traits of a successful leader to those of a failed leader. The basic idea of this entry is that “a leader is born and not made.” This entry is based on the premise that there are a set of characteristics or traits that distinguish between a successful leader and a failed leader. These traits are often identified by measuring the psychological, social, and organic traits of outstanding leaders

The results of research in this field have led to the suggestion of a large number of essential features of a successful leader. However, those features were sometimes consistent with each other and sometimes conflicting. However, the results of these traits did not ultimately lead to the formation of a clear and specific pattern that could be relied upon in describing the characteristics of a successful leader. For example, interaction with others and the desire to make social friends may be one of the main characteristics of a successful leader. However, there are many successful leaders who are isolated and unable to form good social relationships(Bortal, 2017,P33).

The results of this entry study do not represent a complete failure. Indeed, there are many features – despite their inconsistency – that are important elements of successful leadership. For example, a successful leader is often characterized by a high degree of intelligence and ability to interact with others.

Table (01) summarizes the most important features that are associated with a successful leadership style in many cases. Despite the relative agreement on these variables, their ability to predict successful leadership style is relatively limited because leadership style is linked to multiple attitudinal conditions. From this point of view, the saying that “a leader is born and not made” cannot be accepted for its fault. It is natural that there are a set of surrounding circumstances that help shape the abilities and talents of a leader. ) Jones,, 2001,P41).

Table (01): The characteristics of a successful leader

Source: prepared by the researcher

:The role of the governing regulatory forces:3

         Foundations are just  a tool designed to allow several parties to invest    their money, expertise and efforts in order to achieve mutual benefits for all parties. Investors, for example, contribute capital without actually managing their operations. Managers manage the operations of the institution without bearing the burden of providing capital personally. From this point of view, the Board of Directors has the authority to approve all decisions that may affect the performance ofthe institution in the long term. This means, by extension, that the institution is governed by its board of directors, which supervises the management leaders in order to achieve the interests of shareholders.  The termcorporate governance refers to therelationship between the three parties that directly affects the performance of an organization in the long term (Figure01).

Over the past years, many shareholders have started to ask what role the board of directors can play. The question was more focused on external board members who in most cases lack experience and knowledge of theFoundation ‘s work and activities, in addition to their lack of enthusiasm and engaging in the work in a manner What is required.

Figure (1): Governing Organizational Forces

Source: prepared by the researcher

4: Thecontributions of boards of directors to administrative excellence

The expected contributions from the boards of directors of different companies vary greatly. In general, the contributions of boards of directors can be measured in light of the ability of the board to perform three main roles: (2014,Wheeler and Hunger).

• Monitoring: monitoring changes that occur inside and outside the organization, and informing the management of the organization of the most important current developments in the business environment to take the required procedures to address those changes. This role represents the minimum expected of boards of directors.
• Evaluation and impact: The Board examines the proposals submitted by managers to make decisions on them, and to give specialized advice if necessary. It is the active boards of directors that pay close attention to this role.
• Initiative and report: In this case, the Board formulates the strategic mission and goals of the organization. Executive management will then put the strategies into practice.

Based on the previous three roles, (2012), Wheeler and Hunger identified a measure to identify board contributions to strategic management processes..

Using this scale, it is possible to measure the extent to which the boards of directors of organizations contribute to achieving organizational excellence. This scale is divided into six types of contributions (Figure 03):

1. Ghost: When the board of directors is unaware of its basic functions, and there are no positive contributions to the strategic management process. In this case, it is clear that achieving administrative excellence is difficult to achieve.
2. Eagle Seal: The role of the Board of Directors in this case is limited to approving the decisions of the executive management. Executive management proposals are often approved without making comments or suggestions. Administrative excellence in this case is only concepts of executive management without the Board having clear fingerprints.
3. Minimum review: In this case, the Board will only discuss some of the issues presented to it by the executive management. Administrative excellence depends here on the topics discussed by the Board without the Council having a clear vision of future excellence.
4. Nominal participation: the board of directors has a limited contribution in reviewing performance and making some management decisions.
5. Effective participation: In this case, the board’s contributions evolve to include approval, questioning, and decision-making specific to the organization’s mission and strategic goals. Teams are often formed to review and control the strategic actions of the organization. It is clear that true excellence can be achieved if the organization’s ability to create a future vision of excellence is increased.
6. Activating factor: The Board of Directors has a leading role in formulating the mission, mission and strategic goals of the organization. Initiative is the key feature of excellence in this case.

 As we live in an era of rapid and terrible technology, global events and changes continue dramatically, making it difficult for many of us to understand these changes, understand them or even deal with them realistically, let alone try to control them. The intensity of these changes has been helped by a series of successive global events, the most important of which were the Russian-Ukrainian war, the beginning of the implementation of several economic policies based on the assumptions of market mechanisms, in addition to the growth of several global economic blocs. Perhaps one of the most important changes in the external environment at the moment is the shift from the era of industry to the age of knowledge.

Some may ask why we think we are on the verge of a transitional phase, the era of knowledge. The answer to this question can be found by identifying some signs that show that we are moving from a planned era (the era of industry) to a future era (the age of knowledge). These signs include the following:

• During the past few decades, human knowledge has advanced equivalent to the progress made by humanity during all its previous stages. It is easy to see that the discoveries and inventions made during the current century are equivalent to or exceed the amount of what humanity has achieved over a long time.
• Economically successful institutionsare those whose products contain as many aspects of human knowledge as possible. The electronics industry is the best witness to this.
• The progress made in the field of production and industry is closely linked to the human knowledge hall
• Therelative importance of human resources working in various fields of knowledge compared to the importance of human resources, whose work is linked to material and industrial capabilities. For example, the demand for system programmers and analysts has increased.
• Power within institutions is transformedinto employees who have the keys to organizational knowledge and control the sources of power and wealth within the institution at the same time.
• The success of manymodern institutions depends on the qualityof their human capital. Quality here means the amount of knowledge and information available to human workers.
• Knowledge has become one of the main areas of global struggle between great powers rather than the struggle over material resources and minerals.

All of the above confirms that we are steps away from a new humanitarian phase characterized by the rule of knowledge. For this reason, we expect that the reason for the failure of manyinstitutions during the transformation period is poor knowledge management rather than poor management of physical technologies as such. It is natural that the probability of such failure will increase in cases where technological changes do not keep pace with similar changes in the philosophy and methods of investing knowledge resources.

The transformation that the world is witnessing now from the era of industry to the age of knowledge means a lot and a lot to organizations that want to excel through human resources. There is no doubt that knowledge is the main variable that will affect scientific progress over the next century. Knowledge will be at the forefront compared to other economic resources. As Francis Bacon said, knowledge is power. “Knowledge is power.”

 During the past few years, we may have started to see some of the expected effects of the knowledge age, which have had a great impact on the management philosophy, structure and staff of organizations. The current trend among business organizations is to ‘shrink’ and retain knowledge workers only. For example, IBM employed 406,000 employees in 2004 but employed 100,000 employees in 2014. The clear meaning of this trend is a shift towards investing in knowledge resources (human assets) rather than investing in knowledge products (physical assets).

From this point of view, the acquisition of knowledge resources by businessinstitutions will be their first way to acquire power, the power of knowledge. Therefore, it can be said that business organizations will make significant scientific progress in the coming periods in the light of only the material resources they “own”, but also in the light of what they “know”. In other words, businessinstitutions must be prepared to meet the challenges of the knowledge age.

Conclusion:

The bottom line is thatbusiness institutions should strive to maximize the use of their human resources, which represent an effective weapon in the struggle of the knowledge age. Seeking to buy all the latest modern technologies will not alone ensure that these organizations are able to meet the requirements and challenges of terrible technology.

 Preparing to face the competition of this terrible development necessarily requires businessinstitutions to manage intellectual capital well. These institutions should also create a work environmentthat emphasizes the importance of change and development as one of the important business values, and create incentives that encourage innovation and innovation.

It is certain that relying on intellectual capital as one of the main channels fordeveloping institutions necessarily requires changing our thinking pattern towards human capital. This means the imperative of working with human capital rather than working with human capital. It also means making the most of their energies and creative abilities. It is also necessary to consider human resources as a strategic advantage and not only a source of cost reduction. Organizations that take in

to account the above considerations can make significant progress in an era where human resources will be the main source of all streams of progress.

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