Reporters:

Mae Hazel E. RagoMarimel Jane Indiola

Madelaine Marie Dela FuenteSiamy Marie Genon

Ryann Cañete

This chapter focuses on:

CENTRAL ROLE OF KNOWLEDGE as the primary means of wealth in today’s economy.

The key resource, HUMAN CAPITAL, the foundation of intellectual capital.

SOCIAL CAPITAL – Networks of relationship among a firm’s members.

The role of TECHNOLOGY in leveraging human capital

CENTRAL ROLE OF KNOWLEDGE

Employee loyalty and commitment

Experience and skills of employees

Customer relationships

Company Values

Reputation

Brand names

Wealth is increasingly created through:

Effective Management of Knowledge workers

Intellectual Capital

Assets such as:

How does the company create value in the knowledge-intensive economy?

• HUMAN CAPITAL (individual capabilities, knowledge, skills, and experience of the company’s employees and managers)

• SOCIAL CAPITAL (the network of relationships that individuals have throughout the organization)

• KNOWLEDGE • Explicit Knowledge (codified, documents like

engg. Drawings, software codes, and patents)• Tacit Knowledge (knowledge in the mind of

employees and is based on their experiences and backgrounds)

Con

sid

er t

he

ff:

Human Capital: The Foundation of Intellectual Capital

Attracting Human Capital

Retaining Human Capital

Developing Human Capital

General knowledge and experience Social skills Values Beliefs Attitudes

Hire for attitude, train for skillEmphasis on:

Attracting

Human

Capital

NetworkingCurrent employees may be best source of new ones

Incentives for referrals

Developing

Human

Capital

-It is not enough to hire top-level talent and expect that the skills and capabilities remain throughout the duration of their employment.

Training and development must take place at all levels

• Active involvement of all leaders at all levels

Monitor process and track development

• Whatever training a firm uses, they must tract individuals for progress and transfer/share the knowledge to their co-employees

Retaining Human Capital

- Finding ways to keep employees away from transferring to another company

Identify with organization’s mission and values

• People who are committed to the core mission and values are less likely to stray or transfer

Strong alliance to organization

Challenging work and stimulating environment

Financial and Nonfinancial Rewards and Incentives

Social Capital: Networks of

relationship among a firm’s members.

Vital Role of Social Capital

• Attraction, Development and retention of talent is a necessary but not sufficient condition for creating competitive advantage

• Knowledge workers are more often loyal to their colleagues and profession than to their employer• Social capital (i.e., friendships, working relationships) may help tie knowledge worker to a firm.

Terms: Pied Piper EffectTeams or networks of people are leaving one company for another. This process is referred to as “Hiring via Personal (Social Networks)”•Some job candidates may bring other talents with them•Can provide mechanism for obtaining resources and information from outside the organization

Potential Downside of Social Capital

Groupthink•Companies have been damaged when people identify strongly with a group, they sometimes support ideas that are wrong

Cost of financial resources

Using TECHNOLOGY in leveraging Human Capital and Knowledge

Sharing knowledge and information can:

• Conserve resources• Develop products and services• Creates new opputunities

Technology can leverage human capital and knowledge within the organization, with customers, and with suppliers through:

•Using networks to share information and develop products and services (email, Electronic or Virtual Teams•Codifying knowledge for competitive advantage

• Tacit Knowledge - (personal experience)• Explicit (codified) knowledge - (documented files, patents)

THANK YOU!!!