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Knowledge, which is based on information, and coupled with cultural and spiritual values, has become a force in itself and a key driver of social, economic, technological and cultural change. Experience in fast-growing economies highlights education as one of the key factors in adopting and successful exploitation of knowledge-based economy. The growth of intellectual capital will create a competitive environment of the new economy in which knowledge is the main product. The importance of knowledge is recognized in business management, thus it is possible to speak of knowledge management as a significant business function. Investing in knowledge, its accessibility, dissemination and use have become a key factor in promoting economic growth, job creation, competitiveness and social dimension of society. In today’s globalized economy, dominated by information and communication technologies (ICT), society as a whole has no chance of becoming successful and competitive unless it adopts and implements all the principles of knowledge-based economy. Economic activities related to production and the use of ICT and knowledge have become main drivers of economic growth in developed market economies. Systematic gathering and use of knowledge aimed at generating new ideas can be achieved by setting up an adequate environment in which the latest ICT facilitate such tasks. Employee knowledge, their work experience, ideas, innovations, motivation, and team spirit enrich organisational culture and enhance the processes within the organisation. Contemporary business operations are so dynamic that some managers remain mere bystanders, as they cannot keep up with the latest trends. The principles of new economy are based on knowledge acquisition and on learning how to exploit and manage knowledge. The present research aims to establish student perceptions on the Croatian higher education system, how they assess knowledge and competencies gained during their studies at polytechnics, and the level of ICT application. The results will point to the advantages and disadvantages of knowledge and skills acquired at polytechnics, thus helping to shape future strategies for the development of a competitive economy.