Abstract
The ability to envision future business opportunities, make adequate preparations, take decisive decisions, and influence other stakeholders towards attainment of set objectives is essential for those in leadership positions. This chapter examines the relationship between global psychological capital and business sustainability. A literature review was conducted on the link between global psychological capital and business sustainability. This study revealed that global psychological capital and firm's innovation are important factors determining the position of a corporation in any industry. An update of global mindsets and positive psychological states of those in management positions will determine the ability to lead workforce creativity and drive firm innovation, thereby culminating into sustainable competitive advantage.
TopBackground
The background of global psychological capital can be traced to the literature in the field of positive psychology (Vogelgesang, Clapp-Smith, & Osland, 2014) and positive organisational behaviour (Larijani & Saravi-Moghadam, 2018; Luthans, Youssef, & Avolio, 2007). The motive of positive psychologists is targeted at enhancing individuals’ psychological strengths or positive psychological state. Development of an individual’s positive psychological state include the following: “(1) having confidence (efficacy) to take on or put in the necessary effort to succeed at challenging tasks, (2) making positive attribution (optimism) about succeeding now and in the future, (3) persevering towards goals and, when necessary, redirecting paths to goals (hope) in order to succeed; and (4) when beset by problems and adversity, sustaining and bouncing back and even beyond (resilience) to attain success” (Luthans et al., 2007, p. 3). Accordingly, the authors classified psychological capital into four sub-constructs using the acronym HERO (Hope, Efficacy, Resilience and Optimism) for proper understanding. The four components of psychological capital (Audiopedia, 2017) are discussed as follows.
- •
Hope is a positive motivational state comprising two basic sub-constructs such as a successful feeling of agency (or goal-oriented determination) and pathways (or proactively planning to achieve those goals) interact (Snyder, Irving, & Anderson, 1991, p. 287 in Luthans et al., 2007).
- •
Self-efficacy in the world of work could be referred to as employees’ confidence in their ability to achieve a specific goal in a specific situation. Empirically, there is a strong positive significant relationship between self-efficacy and work-related outcomes (Luthans et al., 2007).
- •
Optimism in the context of positive organisational behaviour or psychological capital is construed as a realistic construct that regards what an employee can or cannot do, as such, optimism reinforces efficacy and hope.
- •
Resilience is defined in positive psychology as a positive way of coping with adversity and stress (Audiopedia, 2017). In positive organisational behaviour, resilience is referred to as an ability to recuperate from stress, conflict, failure, change or increase in responsibility.
Key Terms in this Chapter
Global Competence: A set of skills acquired by leaders in solving complex business problems, understanding perspectives, building networks for social interactions in a multicultural environment and taking informed decisions.
Positive Psychological Capital: A developmental state of global leaders, which is characterized by high level of resiliency, realistic optimism, hope, and self-efficacy.
Cultural Tolerance: Ability of global leaders to endure and/or manage subordinates from different cultures towards accomplishment of organizational goals and objectives.
Tech-Savvy: Proficient knowledge and adoption of vast technological innovations in meeting business or customers’ demands.
Digital Age: An era for prolific development and use of sophisticated technological innovation in almost all aspect of global business activities.
Leadership Development: A process of expanding the capacity of current and future global leaders with the aim of improving leadership behavior within an organization.
Competitiveness: Ability of a corporation to develop and offer unique products and services that surpassed the quality standards in domestic and global marketplace at reasonable prices.