CHPT 4 Strategic Management: Intellectual Assets

Knowledge Economy

An economy where wealth is created through effective management of knowledge workers instead of physical and financial assets.

Intellectual Capital

The difference between a firm's market value and book value, measuring the value of its intangible assets.

Human Capital

The individual capabilities, knowledge, skills, and experience of a company's employees and managers.

Social Capital

The network of friendships and working relationships between talented people both inside and outside the organization.

Explicit Knowledge

Knowledge that is codified, documented, easily reproduced, and widely distributed, such as patents and software code.

Tacit Knowledge

Knowledge in the minds of employees based on their experiences and backgrounds, shared only with their consent.

Three-Legged Stool Analogy

Represents the interdependence of attracting, developing, and retaining human capital; if one leg fails, the stool collapses.

Hire for Attitude, Train for Skill

A hiring approach focusing on employee mind-sets, values, and social skills, assuming task-specific skills can be learned.

Bozo Filter

An online test used by employers to evaluate a job candidate's problem-solving ability and attitude before an interview.

Boomerang Employees

Former employees who leave an organization and later return, serving as a valuable, cost-effective recruitment pool.

Alumni Employees

Former employees who maintain relationships with the firm, potentially acting as suppliers, mentors, or brand ambassadors.

360-Degree Evaluation and Feedback

A performance appraisal system where superiors, peers, direct reports, and customers rate an individual's performance.

Stack Ranking

A performance evaluation model that forces a set percentage of team members into predefined categories, potentially harming teamwork.

Intrinsic Motivation

The motivation to work on something because it is exciting, satisfying, or personally challenging.

Redefining Jobs

Breaking high-end knowledge work into specialized pieces and transferring routine tasks to lower-skilled workers or service centers.

Cost Argument for Diversity

The premise that firms effectively managing diversity will gain a cost advantage over those that do not.

Resource Acquisition Argument for Diversity

Firms with strong reputations as employers for women and minorities gain an advantage in the competition for top talent.

Marketing Argument for Diversity

The insight and cultural sensitivity that diverse employees bring improve a firm's marketing efforts in multinational settings.

Creativity Argument for Diversity

A reduction in historical conformity norms and an increase in diverse perspectives improve a firm's overall level of creativity.

Problem-Solving Argument for Diversity

Heterogeneous decision-making groups produce better solutions due to a wider range of perspectives and thorough analysis.

Organizational Flexibility Argument for Diversity

Effective diversity programs make systems less standardized and more fluid, allowing faster adaptation to environmental changes.

Pied Piper Effect

A trend where teams or networks of people leave one company en masse to join another.

Connector

An individual in a social network who links people, ideas, and resources that would not normally interact.

Social Network Analysis

The analysis of the pattern of social interactions among individuals to diagnose communication effectiveness and clusters.

Closure (Social Networks)

The degree to which all members of a social network have relationships with other group members, fostering trust and norms.

Bridging Relationships

Relationships in a social network that connect otherwise disconnected people or groups across structural boundaries.

Structural Holes

Social gaps between groups in a network where few relationships bridge the groups, often referred to as silos or stovepipes.

Groupthink

A psychological tendency in organizations with high closure and low external input for individuals not to question shared beliefs.

Reverse Mentoring

A relationship where senior executives are mentored by junior professionals who possess more updated technical skills.

Virtual Teams

Electronic teams enabled by technology that allow professionals to collaborate and develop products with increased speed.