Abstract
In the intellectual capital and knowledge management (KM) literatures, emotional capital has been a neglected dimension. From the late 1980s into the 1990s, there was burgeoning interest in intellectual capital, which had a substantial impact on the early development of KM. Over the past decade, social capital theory has sparked a new wave of thinking in KM. The concept of emotional capital has the potential to further enrich the knowledge base of the KM discipline. This article explicates the concept of emotional capital and provides a framework for understanding its role in organisational KM.
Key Terms in this Chapter
Frames and Framing: The process of applying to the analysis of a complex situation or problem a series of alternate frames in order to understand the situation more thoroughly (eg considering human capital from three different perspectives of intellectual capital, social capital and emotional capital), and synthesising insights from that analysis for more informed decision making.
Emotion: Feelings; an affective state involving the experience of joy, sorrow, love, hate, fear, and so on; distinguished from cognition.
Emotional Climate: An organisation’s emotional climate is a set of organisational characteristics that are determined by the way the organisation deals with those in both its internal and external environments, through the subtle interplay of human factors and organisational factors. It is a constant feature of the social and relational environment and has a dramatic impact on organisational life, learning processes and performance outcomes. Emotional climate is closely related to the behaviour of organisational members, and particularly to policies and behaviour of top management (i.e. behaviours which are rewarded by management). It strongly effects individual motivation, job satisfaction, attitudes, expectations and behaviour in organisations. A positive emotional climate acts as an incentive, stimulating creativity, growth and professional development, while a negative emotional climate stunts growth and stifles initiative. Emotional climate appears to be a significant contributor to overall staff morale, performance and productivity, and to the organisation’s ability to apply creative problem solving in response to environmental demands. It is a crucial factor when considering supportive contexts for organisational learning and knowledge management.
Organisational Social Capital: The value that an organisation derives from networks of social relationships internal and external to the organisation; these networks provide a source of individual, group and organisational advantage, and facilitate cooperation and purposeful action for collective benefit. Such social networks are derived from both the formal authority structure and from informal associations based on affinity/friendship or around expertise and advice dependencies.
Organisational Emotional Capital: The value embedded in the ‘stock of emotions, feelings, beliefs, and values that are held in and around an organization’, which motivates people to positive action ( Thomson, 1998 , p. 316). A focus on organisational emotional capital involves: recognising the importance and role of emotion in work contexts—in supporting and facilitating learning and innovation, and achieving organisational goals; seeking to foster a positive emotional climate; and a commitment to ensuring the emotional wellbeing of employees. Emotional capital is centred on the perspective of the individual in interaction with the immediate group, i.e. on intra personal and inter personal factors at work.
Social Capital: ‘Features of social organization such as networks, norms, and social trust that facilitate coordination and cooperation for mutual benefit’ ( Putnam, 1993 ).
Emotional Intelligence: Broadly, the ability to effectively recognise and manage emotions. Building on Gardner’s (1983) Theory of Multiple Intelligences, Salovey and Mayer (1990 ; Mayer & Salovey, 1993 ) attempted to redefine intelligence in terms of what it takes to live life successfully. They identified five domains of personal intelligence that they labelled emotional intelligence . These domains included: self-awareness, managing emotions appropriately, self-motivation and enthusiasm, recognising emotions in others, and social competence. The concept of emotional intelligence (EI) focuses on an intra personal level of analysis, and has been used to explain individual differences in motivation, commitment, achievement and relationship/interpersonal/communication skills in organisations. EI ideas derive from cognitive psychology, social psychology and communication theory (verbal, non-verbal communication).
Organisational Intellectual Capital: The value embedded in the expertise, knowledge and skills of an organisation’s ‘people’ and various explicit and implicit representations of this knowledge, eg as embodied in organisational products and services, processes, structures, systems and technologies. Some of these knowledge representations may be legally protected under intellectual property laws.
Human Capital: In broad terms, the people-based resources of an organisation. Most KM writers emphasise the intellectual capital dimension of human capital.