Theory E²: Working with Entrepreneurs in Closely-Held Enterprises XI. The Acts of Appreciation
Previous in this series of essays I pointed to the metaphor offered by Hernando DeSoto regarding the nature of human capital. He suggested that human capital is often not fully actualized in many societies. Like the water that is accumulated behind a dam and that only generates energy after being sent through a generator, so human capital sits dormant unless there are structures, policies and cultural factors within an organization that helps to actualize this capital. Water in a dam must be channeled and transformed to useable (rather than potential) energy via turbines. Similarly, human capital must be channeled and transformed. In this essay I identify several ways in which this transformation can take place in a closely=held enterprise through specific acts of appreciation.
There are three domains through which acts of appreciation can channel and transform potential human capital into organizational energy. These three domains are information, intentions and ideas. The domain of information is entered whenever we attempt to find out more about the current condition in which we find ourselves. In soliciting information, leaders act as researchers, asking questions that can be answered by a systematic collection of information. For example, if a college wants to know which of four academic programs are potentially most attractive to a particular group of prospective students, then a sample of these students might be asked to indicate under what conditions they would be likely to enroll in each of these four programs. The information obtained is valid if the students have been honest, if the right questions were asked and if the sample used was representative of the entire pool of potential students. If the information is valid, then the college should be able to state with some confidence which of the academic programs is most attractive to this population of potential students.