Relationship Capital, Starting With Your Customers

As with human capital, relationship capital has always been a part of business.

Organizations have always had customers, vendors and financing partners, to name a few. But the nature of these relationships has been changing more dramatically in recent years. First of all, networking technology has made it easier to outsource pieces of a business that were formerly inside the corporation. The relationships with critical outsourcing partners are closer than that of arms-length client-vendor relationships.

You may find yourself on both sides of this dynamic, performing outsourced services for your customers but also outsourcing some of your internal processes to a vendor. Read more

Intangible Capital Reading List on Twitter for 2010-06-22

• Just added a new discussion on the ic knowledge center: SG&A as a proxy for IC? http://ning.it/bOL7aP #
• New Study: High Speed Rail Will Create Mucho Jobs – Innovation America: http://bit.ly/aw998A via @addthis #
• Gulf oil leak as metaphor for our era. It’s time to take a step back and apply our intangible capital in new ways http://bit.ly/bHOJVi #
• Just participating in scheduling a group meeting on Doodle. I liked the simplicity! http://bit.ly/9pBMnc #
• Heading into Boston for “Intelligent Economy” from #SMCBoston Have ticket to Stephen Baker keynote too. http://bit.ly/d4xKj8 #
• Stephen Baker at #enzee and #smboston Wrote Numerati. New book on way coming avalanche of data. #
• #enzee #smboston cited Borges story Precision of Science. Synthesis is the challenge. The two biggest challenges: sensors and words. #
• Sensors will give us a lot of new behavioral data. Business models still elusive. #enzee #smboston #
• 1st 60 yrs computer age we have had to speak computer but computers could process our languages. Bakers new book on this #enzee #smboston #
• Baker wrote the article yesterday in NYTimes on Watson-computer to compete in Jeopardy. In this world, what should we store in our heads? #
• Speaker from Microstrategy talking about App phones (not smart phones). It’s about building biz apps to facilitate specific tasks. #
• BI apps should be multisense, aesthetic appeal, guided (not a data study device, its a decision device), interconnected, contextual. #

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Intangible Capital Reading List on Twitter for 2010-06-22

• Just added a new discussion on the ic knowledge center: SG&A as a proxy for IC? http://ning.it/bOL7aP #
• New Study: High Speed Rail Will Create Mucho Jobs – Innovation America: http://bit.ly/aw998A via @addthis #
• Gulf oil leak as metaphor for our era. It’s time to take a step back and apply our intangible capital in new ways http://bit.ly/bHOJVi #
• Just participating in scheduling a group meeting on Doodle. I liked the simplicity! http://bit.ly/9pBMnc #
• Heading into Boston for “Intelligent Economy” from #SMCBoston Have ticket to Stephen Baker keynote too. http://bit.ly/d4xKj8 #
• Stephen Baker at #enzee and #smboston Wrote Numerati. New book on way coming avalanche of data. #
• #enzee #smboston cited Borges story Precision of Science. Synthesis is the challenge. The two biggest challenges: sensors and words. #
• Sensors will give us a lot of new behavioral data. Business models still elusive. #enzee #smboston #
• 1st 60 yrs computer age we have had to speak computer but computers could process our languages. Bakers new book on this #enzee #smboston #
• Baker wrote the article yesterday in NYTimes on Watson-computer to compete in Jeopardy. In this world, what should we store in our heads? #
• Speaker from Microstrategy talking about App phones (not smart phones). It’s about building biz apps to facilitate specific tasks. #
• BI apps should be multisense, aesthetic appeal, guided (not a data study device, its a decision device), interconnected, contextual. #

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Four Ways of Understanding Employees As Human Capital

Every human being is different. As employees, human beings bring unique talents and abilities to their employers. This diverse skills set brings a richness to an organization that can be difficult to capture. Do not let this richness keep you from trying to understand your human capital as a productive asset. There are actually some very clear ways of describing employee groups:

• Competencies
• Experience
• Longevity
• Attitude

Read more

Intangible Capital Reading List on Twitter for 2010-06-20

• Just added a new discussion on ic knowledge center – ways to follow our community http://ning.it/9dipWb #
• Lesson for Massachusetts? We lost Local Motors to AZ (this co. featured in Intangible Capital) http://bit.ly/cm3Loi #
• Daniel Pink: with cognitive tasks, a larger reward leads to poorer performance–animated story from Drive http://youtu.be/u6XAPnuFjJc #

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Intangible Capital Reading List on Twitter for 2010-06-19

• Must read from Dan Robles–where will the knowledge era take us? “Crowdsourcing The New Exploitation” http://bit.ly/dzsMGB /cc @feedly #

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Intangible Capital Reading List on Twitter for 2010-06-18

• Just commented on power of structural capital at “Reach multipliers” on ic knowledge center: http://ning.it/bDLLQU #
• New event on ICKC: Mary Adams hosts discussion “Building Corporate Reputation in Post-BP Marketplace” http://ning.it/atP05X #
• Is there a better way? Today, the United States spends more on its military than during the height of the Cold War. http://bit.ly/dzcoHe #
• The future of your company depends on what you know, not what you own. #
• More proof of the obvious: Firms with high input in intangibles also have an above average observed rate of return http://bit.ly/ahsmwi #
• Simplistic but interesting: Intangible values at record high in the US, but falling elsewhere http://bit.ly/cZqWDx #

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The Central Importance of Human Capital

Knowledge in an organization begins and ends with people. The knowledge and experience that employees bring to their work is probably the greatest driver of an organization’s success. What employees know helps to build an organization as well as to preserve, maintain and improve it.

This importance is generally accepted. It is rare to meet a CEO who won’t tell you that his or her organization has the “best people” in the market. But this kind of statement is rarely challenged. Most businesspeople still don’t know how to see beyond the people and understand the employees and managers of an organization as knowledge assets—as human capital.

There are some that are critical of the label “human capital.” To them, it seems to smack of an attitude that people are just nameless cogs in an organization, exploited for their knowledge and experience. We don’t share that view. In fact, we like the term human capital because it is a graphic statement of the fact that people are indeed an asset of the organization. Assets require investment and maintenance. And they are a critical part of the productive capacity of the organization.

To us, this is the realization that matters—that your people are part of your productive capacity, now more so than ever. Because the future of your company depends on what you know rather than what you own. And what you know as an organization is intimately tied to the knowledge and experience of the people in your organization. In looking at human capital, it is helpful to distinguish between employees and managers. Both groups are employees but managers need a set of competencies that is distinct from those required for your value creation processes–I’ll look at each in the next couple posts.

Adapted from Intangible Capital: Putting Knowledge to Work in the 21st Century Organization

Intangible Capital Reading List on Twitter for 2010-06-17

• Compare to the Swedish article yesterday: The Horrible Work-Life Truth I Learned at the Harvard Business School Reunion http://bit.ly/aBjuBI #
• It’s inevitable: CICA – Practical Guidance for Using the Internet in Corporate Reporting http://bit.ly/9OUF4M /cc @feedly #
• Ending short-termism…Changing the Rules of the Game: A Solution to the BP Problem http://bit.ly/anmafw /cc @feedly #
• Important thoughts on innovation ecosystems: Niches within tech clusters http://bit.ly/9zcZnV /cc @feedly #

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The Two Families of Organizational Assets in a Knowledge-Era Organization

As we begin to broaden our discussion of intangibles, there is a distinction we want to make about the organization of businesses. It is inspired by the Value Chain graphic created by Michael Porter back in 1985. Read more

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