This brief analysis clearly indicates that appreciation is a rich—and provocative—concept. The term has several closely related meanings that tend to build on one another. We shall make use of each of these meanings while describing six strategies of Theory E² in this series of essays.
Appreciation and the Release of Human Capital
Appreciation is not always easy to engage. We should appreciate those times when appreciation is found in our closely-held organizations. Considering all the changes occurring in contemporary societies throughout the world, it is often easy to overlook the indispensable role that people play in organizations. The people-factor in organizations is particularly challenging, for several profound changes are occurring that are not easily understood or addressed. It is not so much the content of the work people do in organizations that has changed; rather, it is the structures and processes of the work that have changed in a profound and irreversible manner. It is the way in which we relate to one another in an organizational setting that is being transformed. We can handle the new technology and the new products and services being asked of our customers. What we can’t handle very well are the new organizational forms that are being created in order to contain these new technologies, products and services.
At the heart of the matter resides a fundamental tenant regarding the appreciation of human capital in an organization and ways in which this appreciation leads to the powerful, energizing release of this human capital for the achievement of organizational success. To better understand the nature of this tenant we turn to the field of economics and, more specifically, to the work of an eminent and highly influential international economist, Hernando De Soto.
De Soto has offered an insightful analysis of the reasons why some countries in the world have capitalist economies that thrive, while other countries have been unsuccessful in their enactment of capitalism. As a Peruvian who has consulted with the leaders of many third world and former communist countries, De Soto is fully aware of the problems encountered by these leaders in seeking to embrace Western capitalism. He believes, however, that the problem resides not in the absence of capital in these countries, but rather in the formal and legal processes whereby the vast capital that already exists in these countries is recognized.
