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Complexity and Knowledge Management Navigators…

Building a society’s knowledge capacity

Earlier this year I delivered a presentation at the OECD (Organisation for Economic Cooperation and Development) conference on innovation in Manama, looking at  Societal Human Resource Development in Bahrain.  I’m sorry for the academic tone of the piece; it always seems as if work like this is only written for academics by academics and this is not the case…but I digress.  The Bahrain government have recognised the issues highlighted in this ‘report’, written with Dr. Farzana Maraghi (Ministry of Education, Bahrain), and we are currently working with them to operationalise a three-year plan for improvement. [I haven’t published the reference list, but please let me know if you want any of them]

Anyway, this is the shortened version of the full report, which is to be published later this year in the ADHR Journal…Hope you find it interesting!


This article explores the link between knowledge as a societal resource for competitive advantage and societal human resource development, with higher education institutions as the active protagonists in the process.  The article argues the need for a triumvirate of education institutions, industry and policy makers to develop societal advantage through human resources in order to meet the needs of the knowledge economy.  This leads to the exploration of Mode 2, or applied, Research in universities as an interface between universities as societal knowledge creators for application against societal needs.  The article then utilises a document analysis method to explore practice in Bahrain as a lens for reflection.  Concluding, the article surfaces observations and recommendations for policy makers and practitioners that include the need for universities to take an active role in the development of societal knowledge resources through applied research.


Knowledge, innovation and adaptive capacity are seen as important drivers for societal competitive advantage as nations transact within the knowledge economy.  This paper explores the link between these drivers and the development of human capital and societal competitive advantage through Higher Education Institutions (HEIs) and particularly Mode 2 research.

Our report uses the Kingdom of Bahrain (Bahrain) as the context for its enquiry.  However, we contend that the literature discussed has the potential for wider relevance and transferability.

Our enquiry has been stimulated by a statement in the Gulf Daily News (Baby, 2008), “Bahrain is the most ideal place in the Gulf to develop a Knowledge City…As a pioneer in education in the region, Bahrain has all the ingredients to make the knowledge concept a reality” (Gulf Daily News, 2011, Knowledge City).  We contend that there is a link between societal human resource development, education, and societal competitive advantage.

This article will first introduce an understanding of how knowledge can be applied for public good.  Examining the concept of the knowledge economy we progress to surface the links to societal competitive advantage through knowledge cities and regions.  We then explore the role of HEIs in the development of people, innovation and knowledge for societal good; illuminating the need for a triumvirate approach, linking education, business and government.  This leads to Mode 2 research as an interface between HEIs and the wider business community.

We then apply the literature against current practice in Bahrain using a document analysis method.  Our findings are presented along with recommendations for practitioners and policy-makers.

Literature Review

Theorists, including Spender (1996), have argued that knowledge exists for the public good:

While land, labour and capital are private goods, knowledge is often said to be a ‘public good’, meaning that it is infinitely extensible and its use by one person does not deprive others of its use. (p. 48)

The definition of public good is based on it being non-rivalrous and non-excludable (Olson, 1971). But knowledge could be seen as an excludable resource through the Knowledge Based View of the organisation, where knowledge is developed for rivalrous advantage, thereby depriving others of its use (Spender, 1996). However, in a societal view, it is necessary to speak of knowledge-based processes in non-rivalrous and non-excludable terms. Using this view Hess & Ostrom (2006) suggested that knowledge exists as a public good, as, once a discovery emerges, it exists as part of the public domain for use by all. Complicating this issue is Reichert (2006), who claimed that the tacit dimension of knowledge is excludable as it can be bound to geographic location; whereas the explicit dimension exists as an accessible, portable resource unbound by geographic location.

Knowledge, such as scientific knowledge, has also been recognised as a “common-pool”, ‘open-access’ resource; a concept informed by economic, behavioural, sociology and social science studies (Dietz, Dolssak, Ostrom, & Stern, 2002, p. 3). Hess & Ostrom (2006) stated that the concept of common-pool resources has traditionally been applied to natural resources, such as fish or water. However, it has evolved to encompass knowledge through the term “knowledge commons’” (p. 3), reflecting the complexity and variability of modern knowledge-based resources and the Knowledge Economy (KE).

The roots of common pool resources are entwined around the needs of what the Organisation for Economic Cooperation and Development (OECD) terms “The Four Pillars of the KE”: innovation; technology; human capital; and adaptive capacity, where knowledge is the driver of growth (Asgeirsdottir, 2005, p. 2). This must also mean that human resources, being the active protagonists in the creation of knowledge, are also drivers of growth.  The management of knowledge resources as a common commodity has been of interest to economists and behavioural and social scientists (Hess & Ostrom, 2006).  Therefore, the question is, what about developing human resources as contributors to knowledge societal good? This leads to the concept of Human Resource Development (HRD)

Briefly, HRD, although devoid of an agreed definition, emerged from the Human Resource Management; where a shift occurred from what could be described as ‘legacy’ human resource activity, such as contract management, towards the skills development of human resources against the strategic and operational needs of the organisation (McGoldrick, Stewart, & Watson, 2002; McLean & McLean, 2001).  This gave rise to the concept of Strategic HRD, where the HR function sits as a business partner within organisation, both reacting to and informing organisation strategy and operational development (Garavan, 2007).  This would seem to place HRD professionals as a key partner in the development of knowledge as a commodity.

Progressing our argument, Wiig (2007) wrote extensively on requirements for successful participation in the KE, stating that it requires an organic stock of intellectual capital, the motivation of the individual to participate in the needs of society, and the societal culture that feeds the individual’s motivation. The argument being that these elements need to be in place for a society to innovate. Richerson, Boyd & Paciotti (2002) observed that this is embedded in the culture of the situated context, which impacts the affective and cognitive styles of the individual and the collective. This in itself would suggest the need for professionals to assist in the understanding and development of HRD constructs within the situated context. With this being the case, we contend that this development of human resources for the public good could be considered to be Societal HRD.

This brings us to a discussion on context.  A knowledge region or city is seen as a network of places, people, processes and purpose that are enabled by knowledge moments; being essential conversations between actors. They are also seen as a form of competitive advantage (Dvir, 2005). Reichert (2006) spoke of a sense of place that brings advantage through the exploitation or exploration of geographically embedded tacit knowledge. Wiig (2007) also warned that cities often have a surplus of human capital in relation to employment opportunities and infrastructure capabilities, causing slums to develop. Extending this strand of thinking, it could also be suggested, that slums can occur through a disconnection between the indigenous population and economic demands. For example, if the population is under-skilled they could be incapable of attracting knowledge intensive employment opportunities that would allow the city or region to prosper.  This appears to point towards the need for societal HRD institutions and frameworks, such as HEIs and government policy, to lift the skill set and quality of life of the general population (McLean 2004).

The idea of knowledge cities or regions has been propagated for several years by theorists (Wiig, 2006; 2007) and is supported by practical examples, such as Manchester, which is seen as a knowledge capital; transforming the region through an innovation network that includes stakeholders such as, regional universities, councils, government agencies, and the airport.  Its success has been acknowledged, winning a global award for “Most Admired Knowledge City Region 2009” (Manchester: Knowledge Capital, 2011, Awards)

Knowledge regions place a city at its hub with outlying towns acting as tributaries that feed the heart of the region. It is through this clustering that innovation is stimulated in the region (Reichert, 2006). For example, Reichert (2006) positioned the power of clusters as the driver for innovation in the KE:

A knowledge intensive firm benefits from the proximity to a cluster of related firms because it can exploit…the competitive advantages provided by critical mass. Knowledge industries are thus more likely to locate to cities in order to achieve these advantages. Hence, city-regions have become the main drivers of the knowledge economy. (p.8)

It would seem that the KE and Knowledge Regions act in a reciprocal relationship through which they drive and are driven by knowledge. According to the National Endowment for Science Technology and the Arts (NESTA, 2007), a network of people, education, and commerce is key to an adaptive society where a reciprocal relationship of attraction builds between skilled people and businesses. However, NESTA warned, “in isolation and without intervention, cities that are not part of this [relationship] may fall victim to a downward spiral of economic stagnation and declining skills base” (p. 2). This reinforces the earlier argument that without the involvement of government, industry and education institutions there is the high potential for reduced societal competitive advantage.  The positive benefits for such a structured HR intervention is supported by NESTA, who link Knowledge Cities to improved cultural variables; through cultural actors, such as higher skilled workers and the creative classes who attract enhanced cultural and consumer standards, as well as an improved quality of life (Florida 2003). The necessity for education in societal KM networks is described by NESTA, which we believe to be a call for societal HRD:

Those cities hosting higher education institutions (HEI) have an inherent advantage as a source of knowledge production. However, an HEI’s primary contribution to its local innovation system is not knowledge, but a workforce capable of exploiting knowledge. (p. 3)

In a global economy where technology brings disparate societies closer together, it is the situated culture of the society that brings competitive advantage to the region or city (Dicken, 2007). Enhancing advantage through inward investment in education, taxation policy, skills base, historic culture, tradition, and links between business and education becomes the currency for innovation and national competitive advantage (Reichert, 2006). National and regional strategies, such as The Europe 2020 Strategy (Barroso, 2010), The Lisbon Strategy (European Commission, Publications) and The Economic Vision 2030 For Bahrain (2009) have emphasised the importance of knowledge growth. But it is the management of common-pool resources at a local level that economics theorists have targeted as being pivotal to the adaptive capacity and productivity of nations (Agrawal, 2002).

National governments in nearly all developing countries have turned to local-level common property institutions….Resource management can never be independent of collective human institutions that frame governance, and local users are often the ones with the greatest stakes in sustainability of resources and institutions. (p. 41)

In our view this demonstrates the need for HEIs to be an active protagonist within initiatives looking to build societal knowledge infrastructure and it is the view of Argawal (2002) that is used as currency for this research in examining the contribution of these institutions.

Education resonates as a key component for innovation and societal knowledge advantage (Barroso, 2010; Wiig, 2007).

People are society’s basic knowledge agents and their knowledge growth through formal and informal education are required for competence to tackle challenges in the private and public sectors and are central to function and progress. (Wiig, 2007, p. 147)

The emphasis on education for developing knowledge for public good is signalled in the Europe 2020 strategy’s call for smart, sustainable, and inclusive growth (Barroso, 2010):

Smart growth means strengthening knowledge and innovation as drivers of our future growth. This requires improving the quality of our education, strengthening our research performance, promoting innovation and knowledge transfer. (p. 9)

The Europe 2020 strategy (Barroso, 2010) also calls for national and regional governments to improve innovation capability by maximising education opportunities for society as a whole. Spender (1996) saw education as a process whereby previously discovered knowledge can be communicated to mass society. The OECD (2008) acknowledged this, observing tertiary education as a pivotal element in the development of human capital, the development of knowledge stores, the sharing and use of knowledge, and the maintenance of knowledge. The OECD also stressed the need for tertiary education institutions to become partners in the strategic development of economic competitiveness in order to ensure the responsiveness of the skill base to community needs.  This appears to reinforce our earlier stated view on the nature of societal HRD.

The link between innovation and education is supported through the Premier League of Innovative European Regions (European Commission, 2011, Premier League of Innovative Regions). The list suggests that the vast majority of the top 22 innovative regions in Europe and are linked to universities with strong research traditions. For example, the United Kingdom’s three representatives in the top 22, all have established old and ancient universities: Oxfordshire, Cambridge, and Edinburgh. This link is further signposted by Scott (2010) in his Times article in which he cited the Chief Executive of the Manchester Knowledge Capital project, ”Education is a key selling point for the city as it bids to attract more business to the area” (p. 11).

Progressing our argument, Harloe and Perry (2004) suggested that HEIs have a duty to transform knowledge production into economic competitive advantage; “…to fulfil this role, universities must produce exploitable knowledge and facilitate its diffusion” (p. 214).  This would not seem unreasonable, for if the university is treated as an entity for the development of societal resources then its output must surely lead to the development of societal competitive advantage. There would therefore appear to be a necessity for universities to engage with industry in order for knowledge to be disseminated, developed and exploited for the wider good of the society to which they serve.  This is championed by the OECD in their reports entitled, “Knowledge Management:  New Challenges for Educational Research” (2003) and “Education Today” (2009).  In both reports the OECD advocated the need for a research strategy that can acquire, store, generate and share knowledge with the wider business community as a way to develop capacity building within society. To facilitate this the OECD recommended a triumvirate of researchers, practitioners and policy-makers to develop knowledge that can better contribute to the needs of society. As such this progresses our narrative towards the emergence and importance of Mode 2 research.

Mode 2 research gained prominence through, “The new production of knowledge” (Gibbons et al. 1994). In summary, Mode 2 research surfaced through the perceived lack of knowledge being produced by HEIs that related to the problems being experienced by practitioners and society.  The concept of Mode 2 research was conceived to close the space between theory and practice, bringing an applied, co-generative approach to knowledge generation, where knowledge could be created in tandem with practitioners, thereby allowing for wider exploitation (MacLean, MacIntosh, & Grant, 2002).  This would seem critical if education institutions are to understand and deliver the sills required by society to compete in the KE; if this is not achieved, as has been suggested earlier in this article, the consequences for society can be dire. Mode 2 research is not without its critics.  It is said that Mode 2 merely brings a new name to a process that was already in existence; the argument being that basic theoretical knowledge (Mode 1 research) could not exist without the knowledge of reality.  It is also said that Mode 2 is one concept in a field of alternatives, such as, “Finalistic Science, Strategic Research, Positivistic Science, Innovation Systems, Academic Capitalism and Triple Helix” (Hessels & Lente, 2008, p. 741).  However, according to Hessels & Lente (2008) it is the most visible concept and as such is adopted in our research.

This points towards a pivotal role for universities, where research can inform national competitive advantage.  If this can be accepted as true then it would seem necessary to enquire into the relationship between universities and industry in order for policy makers to direct the development of a society’s competitive advantage.

The Problem Statement

If knowledge and human resources are of value to society, then the analysis of the processes supporting its development is a significant issue for policy makers. If current provision proves inadequate for the task, then an alternative solution needs to be offered in order to support policymakers in developing knowledge for the public good.

Therefore, the question for this paper is: How are universities in Bahrain being encouraged to engage with industry in order to develop national competitive advantage, which in turn will promote (or contribute to) the development of the society in Bahrain, and to what extent is that engagement being realised?


We set out to explore the literature on innovation, the knowledge economy, societal HRD and knowledge cities, and, guided by these findings, we described the link between national competitive advantage, the associated benefits in the development of the society in Bahrain, and Mode 2 research in Higher Education Institutions.  With the research team having experience of working in the region, we identified Bahrain as a suitable region, or lens, for enquiry.  It was also decided that limitations of geographic location and time would not allow for interviews at this stage of the research process.  Document analysis was therefore selected as the method for enquiry, which is supported by Dew (2006) for ease of access, repeatability of the process, and the wealth of information available to the interrogation of documents.  He stressed that such analysis could be subject to the cultural and historic bias of the researcher.  Dew (2006) also recognised that documents are created to achieve an end and are embedded within their own social, historical and cultural processes.

We attempted to overcome these biases through the shared understanding of the researchers, who have worked with(in) the higher education sector in Bahrain and are familiar with local custom and practice.  The researchers also utilised senior research staff within the University of Edinburgh to provide an external third-party view of the process.  Only documents generated by international bodies, such as the United Nations Educational Scientific and Cultural organisation (UNESCO), national and local government organisations and higher education institutions in Bahrain were used for the enquiry.


Bahrain sets out its strategy for the development of societal knowledge, competitive advantage, the associated benefits in the development of the society, through the Economic Vision 2030 for Bahrain (Bahrain Government, 2009).  The following extracts demonstrate the direction being given in the areas of concern to this paper:

  • “Bahrain’s economy will attain increasing levels of sophistication and innovation, enabling the country to claim an attractive position in the global value chain.  As a result, we will capture emerging opportunities, particularly by expanding to knowledge-based sectors…” (p. 16)
  • “Education empowers people to reach their full potential in business, government and society.  It will shape and develop the successive generations of leaders that our country needs…” (p. 21)
  • “The strategy will need to….Encourage research and development in universities to create a platform for a knowledge-based economy” (p. 22)

Bahrain was ranked 49th in the 2009 World Bank Knowledge Economy Index (KEI), which takes into account weighted scores for innovation and education; being the fourth highest ranked Middle east country, with only Israel (26th), Qatar (44th) and United Arab Emirates (45th) ranking higher.  However, Bahrain ranks 80th in the innovation table, 8th in the Middle East region, and 60th in the education table (World Bank, KEI).

According to the World Economic Forum (WEF) the quality of higher education is seen as a core element in determining a country’s ability to compete globally (  According to the WEF’ Global Competitiveness Report (GCR) (Schwab, 2010), Bahrain was ranked 44th in the world in the area of education, this takes into account not only enrolment in education institutions, but also the view of wider industry.  Of significance, the third most problematic factor for doing business in Bahrain was an inadequately educated workforce.  Unpacking the WEF findings further it becomes apparent that there is a shortage in research and training services, where Bahrain ranks 81st globally.  The quality of management schools in Bahrain reflects a ranking of 45th, compared with their neighbour, Qatar, who rank 1st.  This is supported by Tamkeen, a skills funding gatekeeper in Bahrain, (2009) who note that Bahrain ranked 96th in 2007 for availability of research/training facilities.

Overall the GCR (Schwab, 2010) observes Bahrain as being in a state of transition from “factor driven”, having unskilled labour and a reliance upon natural resources, to, “efficiency driven” developing efficiency and quality processes within their labour markets.  However, they are still seen as being a far way off the desired state of, “innovation-driven” with companies possessing mature adaptive capacity processes that allow them to compete in the global knowledge economy.  This appears to suggest that education should be a concern for the Bahraini government if they are to meet their goal of a transformation towards a knowledge-based economy.

In 2009 Moulton & Waast conducted a report for UNESCO into the performance of national research systems.  The findings placed Bahrain 10th in the Middle East region, with an output of 55 in 2006 and a growth factor of 1 for the period between 1987 and 2006.  The median score for Asia and the Middle East was an output of 350.  Moulton & Waast (2009) criticised higher education institutions in the Middle East for not developing a clear research strategy.

Countries relying on income from natural resources (for instance the oil economies)…do not really need science and research.  They may maintain universities, invite top-flight teachers, and support the research they pursue for their own career and prestige of sponsors (as in some Gulf countries until recently), but their commitment is unclear. (p. 153)

The authors note that while oil producing countries have under invested in research in the past, they are now beginning to prepare for a transformation brought about by the looming “post petroleum era”.  Bahrain has recognised the deficiencies in its research output: “On a global scale, Bahrain’s innovation output is currently negligible” (Bahrain Government, 2009, p. 9) and the government challenges the country to develop new economic advantage through the knowledge inherent within its people: “…innovation and productivity have become crucial sources of competitive advantage” (p. 9).

Of particular interest to this enquiry was the Bahrain Quality Assurance Authority for Education and Training (QAAET) (2009) review of twelve undergraduate programmes in the business subject area.  The QAAET (2009) findings revealed “no confidence” in four programmes and “limited confidence” in four other programmes. This is of concern as these business programmes could be seen as the foundation tools for the management and development of Bahrain’s future competitive advantage, which, according to the National Endowment for Science Technology and the Arts (NESTA) (2007), means that universities are failing in one of their primary functions, being the provision of a skilled workforce for deployment in the knowledge economy. The significance of this issue is revealed in the Tamkeen (2009) report into education in Bahrain, where, “48% of graduates who qualified in 2007 were not working 3 months after graduating, which is a serious concern…” (p. 75).  These findings support the WEF view of quality in higher education in Bahrain.  This said, the QAEET report also recognised the need to improve education provision in HEIs in order to improve innovation and the competitive position of the nation in the Gulf States Region, which should begin to address Bahrain’s position KEI and WEF rankings.

The Kingdom of Bahrain has chosen education as the path through which it will overcome various obstacles and be at the cutting edge of development in every aspect of Bahraini life. (QAAET, citing His Excellency, Shaikh Khalid bin Abdulla Al Khalifa, 2009, p. 8)

This recognition of Bahrain’s deficiencies and willingness to reflect and address issues in the education sector demonstrates Bahrain’s appetite to improve its adaptive capacity and should serve the country well as it looks to enhance national competitive advantage.  This is perhaps reflected in the increase in the absolute contribution of the education sector to Gross Domestic Product, which grew by 10.2% between 2004 and 2008.  Investment in the education sector also appears evident, with the sector experiencing employment growth of 19.4% between 2002 and 2007.

Recommendations For Practitioners

There are lessons to be learned in highlighting the need to develop education partnerships for any organisation transacting within the knowledge economy.  For example, the Bahrain Higher Education Council and Ministry of Education have responded to this problem through a strategic and operational review. In the first instance the Higher Education Council have developed new strategic statements for higher education institutions, with the following requirement:

Develop mechanisms to encourage collaboration between higher education and business and industry that have a demonstrable impact on teaching and learning and research to ensure in particular that: All students are prepared for the world of work through the
provision of generic (work ready) skills on every programme; the development
of generic skills to take account of employers’ views. (F. Maraghi, personal communication (original text translated), July 26, 2011)

In addition the Higher Education Council is in the process of developing a ‘Knowledge-Network’, in collaboration with the University of Edinburgh, as an interface between higher education institutions, policy makers and industry.  This network will include an audit of the challenges being faced by industry in Bahrain (environmental analysis) in contrast to the undergraduate and postgraduate courses being offered in Bahrain universities – leading to a review of current provision and a proposed development of course in the areas of innovation, sustainability, Human Resource Development and Training and Development; an audit of expertise within higher education institutions that will inform a research directory, accessible by industry – this will also include a knowledge mapping exercise in an attempt to capture key expertise, as part of a wider Knowledge Management programme that attempts to mitigate the risk of knowledge loss as senior university staff retire; a programme of professional development for university staff informed by the gaps identified through the environmental analysis; a research strategy for higher education institutions, focused on the needs of new skills for the knowledge economy; Action Learning groups that bring academic and industry experts together to plan strategy and action for the future; and a challenge/reward framework, where industry sets challenges for academic colleagues with a reward being offered if the challenge is met.

Recommendations For Policy-Makers

Policy makers within higher education institutions and government can learn from the reaction of the Bahrain Ministry of Education to the challenges facing their higher education institutions.  There is a need to raise awareness with regard to the importance of research to innovation, Human Resource Development, the development of knowledge for societal good and the competitive advantage of society as a whole.  The Bahrain example used in this paper provides a signpost for the need for intervention at ministerial level if the triumvirate of partners highlighted in this paper are to be effective.


In developing this paper it became evident that there was a need to progress research to an interview based method, as, for example, literature pertaining to the research activity of Bahraini universities was difficult to acquire.  The limitations of a restrictive word count for this article also limited the data that could be presented.  The researcher also found English language versions of government and higher education institution strategies difficult to obtain.  However, a member of our research team, being a Bahraini national employed within the Ministry of Education, assisted in overcoming some of these barriers.  These shortcomings accepted our belief is that this should not detract from the fact that there was sufficient evidence from numerous credible sources to support the recommendations put forward.


We began with the Baby’s (2008) call for Bahrain to become a knowledge city as the stimulus for our research.  Our literature review found successful societal knowledge, innovation and human resource processes to be closely linked to education. We also highlighted the role of higher education institutions in developing human resources in enabling innovation, knowledge and adaptive capacity for societal good. The signals resonated clearly in the literature; education is a key societal partner in the development of societal knowledge resources via the development of people and knowledge for the public good.  We contend that this is societal human resource development. This led to the exploration of Mode 2 research as a point of engagement between higher education institutions and the wider business community.  From this point we developed a problem statement that focused on the relationship between universities, research and the Bahraini business community.

Using document analysis as a method we applied the literature to current practice in Bahrain; though we contend that the findings are transferable and lessons are there to be learned by practitioners, education institutions and policy makers within the wider global community.  This is evidenced by the fact that much of the literature has emerged out of what could be termed, Western society and yet it has been successfully applied in a Middle East setting.

We found Bahrain to be a country in the embryonic stages of innovation and, as such, human resource development.  The relationship between government and higher education institutions appears to be a unidirectional one, driven by the government, which needs to be addressed by the universities, who need to become willing partners in the societal human resource development and innovation process.  Similarly, the relationship between universities and the wider business communities can only be described as fragmented at best.

While these negatives cannot be ignored, and there has to be acceptance that they hinder Bahrain’s current ability to become a knowledge region, the government is motivated to address these issues and there is evidence of change that could not only impact Bahrain, but the region as a whole.  Closing at the point from which we started, the statement by Baby (2008) of Bahrain being an education pioneer in the region appears to be overstated.  However, if the issues highlighted in this report can be addressed there would seem to be no reason why Manama cannot achieve the aspiration of becoming a knowledge city, driving knowledge for the public good through societal human resource development.

So, what do you think?

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