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Archive for August 2011

The intangible side of an organization.

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Traditionally, each company or organization used to publish financial statements in order to present their results and the performances of the activity. Most of the time, the level of profit is the main concern of companies. Of course, making profit is a essential condition to ensure the durability of a company and to finance in future projects. But is profit the only condition and the only parameter proving the good wealth of a company, of an organization?

A financial statement is a picture at a T time of the property of a company, an organization. A picture provide a range of information, but the evolution between two period of time will tell more about the trend of the business or the activity. In other words, the movie will tell us more than a couple of pictures. Nevertheless, these financial information does not include a range of intangible values that will have a positive or negative impact on the activity or the business.

What are these intangible values contributing to the sustainability of a company, of an organization? Let us review a few of them:

  • Innovation: in a fast moving environment where a lot of competitors are acting, innovation is a key factor of success. Innovation requires to perceive the trends of evolution, to look at the expectation of people, of to potential market needs. Innovation means to anticipate and to look further than the horizon. Innovation and creation of new innovative products or services will distinguish your company from your competitors. Success is never definitively acquired. But sometime, companies are meeting success and forget that success has a time. The major point is not how to survive to failure, but how to survive to success.
  • Talent and competences: An organization or a company works only thanks to the collaboration of people having competences and skills. The development of competences level will contribute to the performance level. The organization needs to have a long term view in term of competence development. Some people are leaving the organization, and it means that a part of know-how is leaving the company too. To ensure the sustainability of resources and talents has to be a major concern of the companies.
  • Vision and team spirit: The organization needs to have a clear vision and all the member have to subscribe to that vision, to the common goal. It is only by sharing the same vision that they can contribute to common goals and show team spirit. A company like Appel Computer succeeded in her major realizations, because Appel members are sharing Steve Jobs vision.
  • Motivation: Each collaborator, each member of a team has competences. But competences is not the only condition making him contributing to the organization by giving the best he can do. The key factor is motivation. He can only be motivated if he has clearly assigned goals and if these goals and the role he has to play within the organization fits with his expectations. People who are not motivated will show poor performances and the level of performances will decrease with the time. People need to be able to express their talents, and to find sense on what they are doing.
  • Wellness: Wellness is linked to motivation. People needs to love their job and to do it with a feeling of to wellness. They need to enjoy their work environment in order to be motivated and to provide the best work they can give. Stress and lack of wellness have a negative impact on the health, and on the productivity. People are only waiting to go back home, their do not want to be considered or identified as a team member of the organization. In these circumstances, it is difficult to reach a common goal.
  • Corporate social responsibility: People are paying more and more attention to the reputation of companies and their engagement to social responsibility. The economy is a major actor of the society and has to integrate values that are respecting the society and the people.

These are a lot of intangible aspects you will never find in a financial statement of an organization or a company. Nevertheless, these aspects can have a positive or negative impact on the performance, but also on the reputation of the organization. And with the development of information technologies and the social medias, your bad reputation can be known quickly and cause important damages to your organization. To take care about these things will contribute to empower the efficiency and to ensure the sustainability of your organization.

Written by Eric Saint-Guillain

August 16, 2011 at 21:08