The key capital resource for companies is no longer cash but knowledge, delegates attending the business leaders' forum Leading Through Change were told yesterday.

Author and broadcaster Prof Charles Handy said people with ideas would strive to retain ownership and control of them. This would have implications for traditional employment relationships, he said.

Work practices were changing dramatically and the death of the corporate career was being witnessed, he argued.

"Work will be organised much like a theatre production," said Prof Handy. "A person with an idea will turn it into a project, get someone to finance it, put it together for the duration and disband it when it is over."

This, he added, had implications for major companies in their current forms.

The world of organisations was dividing into elephants and fleas - the huge and the tiny. Unless they adapted, many elephants faced an uncertain future. In 10 years' time, Fortune 500 companies would make up less than 15 per cent of organisations.

Technology, primarily the Internet, would have a huge impact, he said. The demise of the Encyclopaedia Britannica in its traditional book form, along with its huge sales force, was cited as an example.

"Today, it doesn't exist as a book. It's a free information service on the Internet, funded by advertising," said Prof Handy.

The advent of Napster and, more recently, Gnutella, might have similar implications for record companies, he said.

Organisations would have to adopt endless second-curve thinking - starting a new product or company life cycle curve before the existing one began its downturn.

"When everything is going well, that's the time you should be thinking about doing something else," he said.

But that would be difficult to do with existing employees, he said.

"That's when you need your `new alchemists', people who can think outside the box," he said.

"They are the people the organisations are going to need every two or three years if they are going to survive."