What types of
capital are you developing?
7 questions for you
Question # 1 What types of digital capital are you developing?
Question # 2 What types of physical / manufactured capital are you developing? Question # 3 What types of financial capital are you developing? Question # 4 What types of human capital are you developing?
Question # 5 What types of social / cultural capital are you developing? Question # 6 What types of natural capital are you helping to improve? Question # 7 What questions can we ask to improve our strengths?
Question # 1 What types of digital capital are you developing?
4 examples of tangible digital capital / assets
1. 2. 3. 4.
Servers. Routers. Online-purchasing platforms. Basic Internet software.
http://www.mckinsey.com/Insights/High_Tech_Telecoms_Internet/Measuring_the_full_impact_of_digital_capital
3 examples of intangible digital capital / assets
1. Designs that engage users. 2. Analytic competencies. 3. Revenue models that monetize digital activity.
http://www.mckinsey.com/Insights/High_Tech_Telecoms_Internet/Measuring_the_full_impact_of_digital_capital
Further inspiration https://www.teacherspayteachers.com/Product/Internet-of-Things-2056421
Question # 2 What types of physical / manufactured capital are you developing?
Manufactured capital - examples Buildings. Machines. Tools. Other equipment. Infrastructure, for example roads, ports, and bridges.
Further inspiration http://www.theiirc.org/wp-content/uploads/2013/03/Business_Model.pdf http://www.projectsigma.co.uk/Guidelines/Principles/Capitals/ManufacturedCapital.asp http://www.ey.com/Publication/vwLUAssets/The_concept_of_capital_in_Integrated_Reporting/$FILE /EY_'Capital'%20in%20Integrated%20Reporting%20April%202013.pdf
Question # 3 What types of financial capital are you developing?
Types / forms of financial capital 1. Equity, i.e. money from owners. 2. Debt, i.e. money from lenders.
Financial capital refers to an individual’s total saved assets, while human capital refers to the individual’s future potential savings from income earned. https://www.cnbank.com/uploadedFiles/Site_Framework/Home_Page/December_2013_-_CIUN_-_Canandaigua[1].pdf
Actively reallocating corporate resources is important in the best of times, and even more so during economic downturns.
There’s something like a 4 percentage-point difference in the average return to shareholders year on year for those who are in the top third of re-allocators versus those in the bottom third. http://www.mckinsey.com/insights/strategy/breaking_down_the_barriers_to_corporate_resource_allocation
Further inspiration
https://www.princeton.edu/~achaney/tmve/wiki100k/docs/Financial_capital.html http://ageconsearch.umn.edu/bitstream/122846/2/FM_WP19%20Determinants%20of%20financial%20capital%20use.pdf
Question # 4 What types of human capital are you developing?
A Knowledge of your values
https://www.teacherspayteachers.com/Product/Questions-to-discover-your-values-1329394
B Knowledge of how you learn well?
https://www.teacherspayteachers.com/Product/Learning-strategies-1487708
C Professional skills
What are you really good at and will you do yourself? What will you outsource? An example.
http://www.mckinseyquarterly.com/Strategy/Strategic_Thinking/Enduring_Ideas_The_business_system_2379
Intangible assets are estimated to account for up to 80% of the value of large companies.
Thus, people contribute to businesses more than any other factor of production. http://www.linkedin.com/groups/Intangible-Assets-nonmonetary-assets-that-3901119.S.71807779
Human capital is the only company resource that supplies the organization with the ability to create ideas, relationships, knowledge and models. Every other financial, physical and cultural resource depends on the active mental, social and psychological talent necessary to fulfill it. Source Poppler, Paul & Stark, Ernest: Rare and Inimitable: Creating Human Capital Advantage. Chief Learning Officer, May 1, 2010.
Intellectual capital is recognized as the most important asset of many of the world’s largest and most powerful companies. http://www.wipo.int/sme/en/documents/value_ip_intangible_assets.htm
Intellectual capital = Competence X commitment http://sloanreview.mit.edu/the-magazine/articles/1998/winter/3922/intellectual-capital-competence-x-commitment/
http://thisisindexed.com/2014/09/commodity/
Human capital can be increased by investing in education and health care.
http://www.economist.com/economics-a-to-z/h#node-21529828
Although companies' percentage of intangible assets, for example research & development, has increased, accounting rules have not kept pace.
http://www.investopedia.com/articles/03/010603.asp#ixzz2Iij3mEe8
Question # 5 What types of social / cultural capital will you develop?
Aspects of social / cultural capital  Strength of relationships with other people, for example with customers.  Degree of involvement in communities. http://www.ey.com/Publication/vwLUAssets/The_concept_of_capital_in_Integrated_Reporting/$FILE/ EY_'Capital'%20in%20Integrated%20Reporting%20April%202013.pdf
3 questions to identify strength of relationship with a person Question # 1: Impact How large is the impact that the potential partner / stakeholder has on your performance? Question # 2: Clear expression of need How clearly can you identify what you need from the stakeholder? Question # 3: Interest in developing the relationship How interested are you in further developing the relationship with the stakeholder? Adapted from https://hbr.org/2014/03/five-questions-to-identify-key-stakeholders/
Social capital is generated by the connections in a social network, and the trust, reciprocity, and resource-sharing qualities of those connections. It can be activated by individuals to gain social support or social leverage, or by collectivities to facilitate organization and collective action. Social capital is commonly viewed as a positive resource, but can become negative when used to exclude outsiders. http://cvp.evans.washington.edu/library/definitions
For production workers, productivity is readily measured in terms of units of output; for transaction workers, in operations per hour. But for knowledge workers, what might be thought of as collaboration productivity depends on the quality and quantity of interactions occurring. http://whatmatters.mckinseydigital.com/internet/using-technology-to-improve-workforce-collaboration
Further inspiration https://www.teacherspayteachers.com/Product/Social-competence-1600674
Question # 6 What types of natural capital are you helping to improve?
Types of natural capital 1. 2. 3. 4. 5. 6.
Air. Water. Land. Forests. Raw materials / minerals. Biodiversity and ecosystem health.
http://www.ey.com/Publication/vwLUAssets/The_concept_of_capital_in_Integrated_Reporting/$FILE/ EY_'Capital'%20in%20Integrated%20Reporting%20April%202013.pdf
Environmental changes
http://www.slideshare.net/frankcalberg/environmental-changes-28839188
Question # 7 What questions can we ask to improve our strengths?
3 questions to find out why people love what you do Question # 1 What do users / customers find that you do really well? Question # 2 What can only you do? What is unique about what you do and how you do things? Question # 3 Why would someone invest their money with you?
Ikea’s stylish, utilitarian, and inexpensive furniture combines expertise in design, sourcing, manufacturing, pricing, packaging, logistics, the customer experience in retail stores, and cost management.
All of these competencies reinforce the others. http://www.strategy-business.com/article/00161?pg=all
With which product / service do you create most value for people? Your answer: _____________________ Description of competencies to create and deliver that product / service
Competence # 1
Competence # 2
How valuable is a competence, that you have, for people you serve?
On a scale from 1 to 100, to what extent is the product / service / technology you deliver scarce / rare / in short supply?
On a scale from 1 to 100, to what extent can a competence you have be transferred to other people?
How difficult would it be for others to copy a competence you have?
How difficult would it be for others to substitute a competence you have with another competence that satisfies needs customers have?
http://flowingdata.com/2010/06/18/profitable-sweet-spot-for-startups/
The strategic sweet spot
Internal strengths External opportunities
External threats
Make the most of these
Internal weaknesses
What will you start doing right now to
make the most of your strengths?
What do you need to do to
use your strengths more?
How can you improve your biggest strengths?
Some sources of inspiration http://www.bqf.org.uk/innovation/2013/07/15/quickly-assess-your-strengths-and-weaknesses/ http://hbr.org/2000/03/meeting-the-challenge-of-disruptive-change/ar/1 http://hbr.org/tip?date=012313 http://www.thoughtyoushouldseethis.com/post/15189657543/samuel-palmisanos-guiding-framework-for-ibm
Thank you for your interest. For further inspiration, feel welcome to visit http://frankcalberg.com/ Have a great day.