Human and Emotional Capital within business

I read an article a few days ago about how you can build Emotional Capital on your balance sheet by inspiring everyone connected to an organisation. Even though emotional commitment is very important, I see something wide of the mark with this approach.

Let’s take a step back and look at the origin of this particular problem - emotional commitment of employees. In my opinion, if you are not truly an employee first organisation, in the likes of Virgin or Google, I can almost guarantee that you will have problems with emotional commitment, productivity, motivation and employee engagement. Many organisations badge themselves as people first to look good, but be honest, in reality it’s most likely employees third, after shareholders and customers.

What difference can a genuine “employee first” policy make to your business? It is quite simple, if employees come first, and is looked after, their enthusiasm and emotional commitment will transfer to their work, the products they produce and the customers they serve. With such a policy you will most likely decrease staff turnover as well as the number of product defects or service failures, increase customer loyalty, profits and thereby share value.

Those who have been employees in their lifetimes will know exactly what I’m talking about. Here is the deal; if you look after your people, they will look after you. Also, if you don’t recruit the right people with the right attitude, you’ll frustrate everyone else who has to work with less committed colleagues and you’ll never be at the top of your league.

So here is a very simple solution to get maximum productivity and emotional commitment out of your workers. Firstly treat people like people, not like a number or a resource or an asset. If you start thinking of people as things that you could own and try to put them alongside objects that depreciate in value on a balance sheet, you’ve made your first mistake.

Secondly recruit the right people from the start, spend the money if you can because it will make your life a whole lot easier and your business more profitable if you get it right.

If you’ve got these two things right you most likely won’t have an issue with motivation, because your staff will give you all they’ve got. Remember people have emotions, dreams, aspirations, make mistakes and can have off days just like everyone else. Look after your people financially and emotionally, respect their dreams and help them achieve it and you you’d be much closer to obtaining optimum productivity, and with that profitability.

Making a profit is what most businesses are about, so if you do well make sure that you share some of your success with the people who have helped make it possible even the ones at the bottom because every employee has a role to play in making your business successful. You wouldn’t have been able to do it without them anyway, so reward them for their hard work.

On the other hand, there are exceptions to every rule and sometimes a slump in business can’t be helped. Times can be tough, but people tend to understand if you’ve shown them enough respect to bare the bourdon with them. My advice to business owners, don’t pay director’s bonuses or buy expensive gadgets and personal excursions if your staff is going through a pay freeze, it’s immoral and unethical and they will not return your action with more commitment and enthusiasm. There has to be a genuine sense of we’re in it together if you’d like to get out if it in one piece.

If you’re wondering about how you are treating your staff, use this rule of thumb. Treat them in the same way as you would like to be treated. Be respectful and have a genuine interest in their financial and emotional wellbeing. More often than not they will treat you with the same respect.

Managing and inspiring people starts with good leader who makes decisions based on sound moral principles and compassion for their workers. It saddens me that we have wait for academics to write a theory about this concept before we take notice as this should be a normal, humane and natural thing to do.