An organization's strategy—amongst other things—has to balance these key tenets of people (its employees), processes, products and or services. These have to be continuously improved to gain and maintain a competitive advantage.
Figure 1: The three (3) Tenets - People, Processes and Products / Services
Several factors contribute to an organization's gaining its competitive advantage, however, the biggest bank for your buck is in empowering “the people”(employees). Employees create the processes, drive the technology, improve on the products or services offered to customers.
According to David Bookbinder, “People are an organization's most valuable asset and the key to its success.” Employees are a major source of an organization's Return on Investment (ROI) therefore, creating an environment of trust and continuous learning for employees to thrive is crucial to an organization’s success. In an employee-focused environment, employees can fail fast and learn fast as this environment encourages innovation, collaboration, and continuous improvement.
An article by the Harvard Business Review titled Creating the Best Workplace on Earth by Rob Goffee and Gareth Jones describes the organization of your dreams as “a company where individual differences are nurtured; information is not suppressed or spun; the company adds value to employees, rather than merely extracting it from them; the organization stands for something meaningful; the work itself is intrinsically rewarding, and there are no stupid rules.”
In organizations where employees are not valued nor empowered, tacit knowledge is lost—the holy grail in knowledge management. Several kinds of research have been conducted that show how engaged employees add tremendous value to organizations. The research by Hay Group found that “highly engaged employees are, on average, 50% more likely to exceed expectations than the least-engaged workers. Organizations with highly engaged employees outperform other organizations with the most disengaged employees—by 54% in employee retention, by 89% in customer satisfaction, and by fourfold in revenue growth.”
Dan Cable from the London Business School also stated that “employees who feel welcome to express their authentic selves at work exhibit higher levels of organizational commitment, individual performance, and propensity to help others.”
In the book Knowledge Management in Theory and Practice, Kimiz Dalkir notes that employees are commonly rewarded for what they know, not what they share. It is important that if an organization's culture is people-focused, it will foster an environment where employees share experiences, lessons learned and best practices willingly. Here innovation and collaboration are organic.
Figure 2: Illustration showing people (employees) as the key driver to increase organization’s ROI and competitive advantage
Organizations that focus on their employees by seeing and treating them as assets not just numbers, gain competitiveness amongst their competition. Also, keeping the employees front and center of any organization’s guiding principles need to be ingrained in its culture to maintain the competitive edge.
Is your organization focusing too much on its processes, products and services while neglecting its people—its most valuable asset? I encourage a re-think.
About the Author
Fola Alabi is a business leader, people builder, change advocate and relentless collaborator. She is always focused on creating and executing strategies that add value to organizations.