Scott A. SnellCornell University

393 Ives HallIthaca, NY 14853(607) 255-4112

scott.snell@cornell.edu

Competing through Knowledge:The Human Capital Architecture

IBM“You can get capital and erect buildings, but it takes people to build a business.”

Thomas J. Watson, IBM

Did IBM forget?• $168 billion (Tobins Q = 2.1) • Hardware, software, and services• Nobel prize-winning scientists• 3,768 patents (1993-1995)

Focus on:

Core Competencies

Network Structures

Network Network StructuresStructures

IntellectualCapital

IntellectualIntellectualCapitalCapital

Partners &Contractors

Partners &Partners &ContractorsContractors

Relational BrokeringRelational Brokering

Information TechnologyInformation Technology

Transparent to CustomersTransparent to Customers

What’s Happening Today?What’s Happening Today?

Industry Changes• Globalization• Information technology

Industry Changes• Globalization• Information technology

Need for…• Organizational agility• Speed• Innovation• Cost

• Knowledge-based strategies• Core competencies• Innovation• External partnerships

Leading to…Leading to…

New Business Equation

Core Competence……is a bundle of skills and technologies that enables a company to provide a particular benefit to customers.

Hamel and Prahalad, 1994

SONY Miniaturization PocketabilityFEDERAL EXPRESS Logistics On-time deliveryHONDA Engine design/mfg. Reliable performanceMOTOROLA Wireless technology Untethered comm.

Core Benefit toCompetence Customer

KnowledgeKnowledge

TechnologiesTechnologies

ProcessesProcesses

RelationshipsRelationships

CRITERIA• valuable• unique• extendable• learning

Benefits VALUE = ---------

Costs

UNIQUE = (social complexity + causal ambiguity)

LEA

RN

ING

= (e

xper

ienc

e x

chal

leng

e)

Competing Through People• Identify & develop core skills• Integrate diverse activities• Respond with agility & speed• Empower action• Innovate

Core Competence…Core Competence…

…is a bundle of skills and technologies that enables a company to provide a particular benefit to customers.

--Hamel and Prahalad

KNOWLEDGE - customer - technology - operations - managing

PROCESSES - customer segmentation - just-in-time (hrs) - mass customization - build to order (AIM) - ROIC metrics - experimentation

TECHNOLOGY

- Premier pages - software installation - TPM triggers (parts, service) - customer purchasing systems

RELATIONSHIPS - customer intimacy (Boeing) - Platinum councils - supplier partnerships (Sony) - employee involvement - third party service maintainers (TPMs) - distribution agreements (UPS, Airbourne)

“Virt

ual I

nteg

ratio

n”

Leading to…Leading to… • ValueValue

• UniquenessUniqueness• LearningLearning

“A low-value product can be made by anyone anywhere. When you have knowledge no one else has access to --that’s dynamite. We guard our intellectual assets even more carefully than our financial assets.” --Roy Vagelos, former CEO Merck

KNOWLEDGE - customer - technology - operations - managing

PROCESSES - customer segmentation - just-in-time (hrs) - mass customization - build to order (AIM) - ROIC metrics - experimentation

TECHNOLOGY

- Premier pages - software installation - TPM triggers (parts, service) - customer purchasing systems

RELATIONSHIPS - customer intimacy (Boeing) - Platinum councils - supplier partnerships (Sony) - employee involvement - third party service maintainers (TPMs) - distribution agreements (UPS, Airbourne)

“Pos

itive

ly O

utra

geou

s S

ervi

ce”

Southwest Airlines

KNOWLEDGE - microbiology - biochemistry - microbiology - imunodiagnostics (antibodies/conjugates)

PROCESSES - R&D/Mfg. - bioconjugation - antibody purification - PCR amplification - DNA hybridization - TQM - commercialization

TECHNOLOGY - immunoassays - ELISA (serum/blood) - rapid diagnostics - DNA based

RELATIONSHIPS - CRC-DT, CDC - U.S. Army - World Health Org. - universities - distribution network - employee (science/mkt)

C2 =

“Rap

id L

earn

ing”

Leading to…Leading to…

An organization at the frontier of its intellectual field is more likely to stay at the frontier. It can attract and challenge more and better intellect than its competitors. By solving more advanced problems, it has more capacity to solve others. And so on.” --- JB Quinn

• ValueValue• UniquenessUniqueness• LearningLearning

BIOTECH INC.

Benefits = ---------

Costs

Combination of people and systemsleads to...

Human Capital

Social Capital

OrganizationalCapital

BioTech, Inc.: Intellectual capital

PeopleSystems

KNOWLEDGE - microbiology - biochemistry - bioconjugation - imunodiagnostics

PROCESSES - R&D/Mfg. - bioconjugation - antibody purification - PCR amplification - DNA hybridization - TQM - commercialization

TECHNOLOGIES - immunoassays - ELISA (serum/blood) - rapid diagnostics - DNA based detection

RELATIONSHIPS - CRC-DT, CDC - U.S. Army - World Health Org. - universities - distribution network - employee (science/mkt)

C2 = “Rapid Learning”

PE

OP

LE

SY

ST

EM

S

Core Competence

KnowledgeKnowledge

TechnologiesTechnologies

ProcessesProcesses

RelationshipsRelationships

BenefitsVALUE = ---------

Costs

UNIQUE = (social complexity + causal ambiguity)

LEA

RN

ING

= (e

xper

ienc

e x

chal

leng

e)

How does human capital contribute to the core competence?

• Value

• Unique

Resources need to be: Benefits

VALUE = --------- Costs

Drives innovationResponds to customer demandsProvides excellent customer serviceAchieves highest qualityInstrumental in process improvementsDevelops new business opportunitiesDirectly affects efficiency and productivityMinimizes costs of production, service, delivery

Not widely available in the marketCannot be bought or appropriatedDifficult to imitate or duplicateSpecialized KSAsDifficult to replaceCustomized to our firmDeveloped through on-the-job experiencesDistinguishes us from our competitors

R&D

Manufacturing/Operations

Distribution

Sales

Sales

TMT

CustServ

HR

R&D

Rapids

Fin

CustomerService

Mfg

R&D

R&DPartners

Core Knowledge

Low VALUE highLow VALUE high

Low

U

NIQ

UE

h

igh

Low

U

NIQ

UE

h

igh

BIOTECH, INC: Mapping Human Capital

KEY Finance

HR

TMT

MIS

Mfg/Operations

Market/Sales

R&D

Quality

Biologicals

Cust. Service

Rapid Diag.

Legal/Reg.

Distribution

KEY Finance

HR

TMT

MIS

Mfg/Operations

Market/Sales

R&D

Quality

Biologicals

Cust. Service

Rapid Diag.

Legal/Reg.

Distribution

Rapids

Scott A. Snell, Cornell University

C2

= R

apid

Lea

rnin

g

HR

Legal MIS

Biologicals

FinQuality

TMT

Compulsory Knowledge

Idiosyncratic Knowledge

Ancillary Knowledge

High ValueHigh ValueLow ValueLow Value

GenericGeneric

CoreCoreIdiosyncraticIdiosyncratic

AncillaryAncillary CompulsoryCompulsory

UniqueUnique

Human Capital ArchitectureHumanCapital• unique• value

HRMSystem

Employ Mode

Core Human Capital

• High Value: Direct link to core competence• High Uniqueness: Firm-specific knowledge and skills

Core Human Capital

• High Value: Direct link to core competence• High Uniqueness: Firm-specific knowledge and skills

Employment Mode: knowledge work

Employment Relationship: organization-focused

Examples: software developers (Microsoft)

drug researchers (Merck)

fund managers (Fidelity)

“gold-collar” workers

High ValueHigh ValueLow ValueLow Value

Unique

GenericGeneric

IdiosyncraticIdiosyncratic

AncillaryAncillary CompulsoryCompulsory

Human Capital Architecture

Core

R&D

Manufacturing/Operations

Distribution

Sales

Sales

TMT

CustServ

HR

R&D

Rapids

Fin

CustomerService

Mfg

R&D

R&DPartners

TRADITIONAL JOB-BASED

EMPLOYMENT

ALLIANCE/ PARTNER

CONTRACT WORK

KNOWLEDGE WORK

Low VALUE highLow VALUE high

Low

U

NIQ

UE

h

igh

Low

U

NIQ

UE

h

igh

BIOTECH, INC: Mapping Human Capital

KEY Finance

HR

TMT

MIS

Mfg/Operations

Market/Sales

R&D

Quality

Biologicals

Cust. Service

Rapid Diag.

Legal/Reg.

Distribution

KEY Finance

HR

TMT

MIS

Mfg/Operations

Market/Sales

R&D

Quality

Biologicals

Cust. Service

Rapid Diag.

Legal/Reg.

Distribution

Rapids

Scott A. Snell, Cornell University

C2

= R

apid

Lea

rnin

g

HR

LegalMIS

Biologicals

FinQuality

TMT

High ValueHigh ValueLow ValueLow Value

Unique

GenericGeneric

CoreCoreIdiosyncraticIdiosyncratic

AncillaryAncillary

Human Capital ArchitectureHuman Capital Architecture

Compulsory

Employment Mode: traditional job

Employment Relationship: job-focused

Examples: staff accountants (Andersen)

sales people (Sears)

truck drivers (UPS)

HighValue: Direct link to strategyHigh Uniqueness: Generic knowledge and skills

HighValue: Direct link to strategyHigh Uniqueness: Generic knowledge and skills

Compulsory Human Capital

• High Value: Direct link to core competence• Low Uniqueness: Generic knowledge and skills

Compulsory Human Capital

• High Value: Direct link to core competence• Low Uniqueness: Generic knowledge and skills

R&D

Manufacturing/Operations

Distribution

Sales

Sales

TMT

CustServ

HR

R&D

Rapids

Fin

CustomerService

Mfg

R&D

R&DPartners

TRADITIONAL JOB-BASED

EMPLOYMENT

ALLIANCE/ PARTNER

CONTRACT WORK

KNOWLEDGE WORK

Low VALUE highLow VALUE high

Low

U

NIQ

UE

h

igh

Low

U

NIQ

UE

h

igh

BIOTECH, INC: Mapping Human Capital

KEY Finance

HR

TMT

MIS

Mfg/Operations

Market/Sales

R&D

Quality

Biologicals

Cust. Service

Rapid Diag.

Legal/Reg.

Distribution

KEY Finance

HR

TMT

MIS

Mfg/Operations

Market/Sales

R&D

Quality

Biologicals

Cust. Service

Rapid Diag.

Legal/Reg.

Distribution

Rapids

Scott A. Snell, Cornell University

C2

= R

apid

Lea

rnin

g

HR

LegalMIS

Biologicals

FinQuality

TMT

Employment Mode: contract work

Employment Relationship: transactional

Examples: assemblers (Nike)

clerical workers (Halliburton)

payroll (Continental)

catering (ARAMARK)

High ValueHigh ValueLow ValueLow Value

Unique

GenericGeneric

CoreCoreIdiosyncraticIdiosyncratic

CompulsoryCompulsory

Human Capital ArchitectureHuman Capital Architecture

AncillaryAncillary

Ancillary Human Capital

• Low Strategic Value: Operational role• Low Uniqueness: Generic knowledge and skills

Ancillary Human Capital

• Low Strategic Value: Operational role• Low Uniqueness: Generic knowledge and skills

R&D

Manufacturing/Operations

Distribution

Sales

Sales

TMT

CustServ

HR

R&D

Rapids

Fin

CustomerService

Mfg

R&D

R&DPartners

TRADITIONAL JOB-BASED

EMPLOYMENT

ALLIANCE/ PARTNER

CONTRACT WORK

KNOWLEDGE WORK

Low VALUE highLow VALUE high

Low

U

NIQ

UE

h

igh

Low

U

NIQ

UE

h

igh

BIOTECH, INC: Mapping Human Capital

KEY Finance

HR

TMT

MIS

Mfg/Operations

Market/Sales

R&D

Quality

Biologicals

Cust. Service

Rapid Diag.

Legal/Reg.

Distribution

KEY Finance

HR

TMT

MIS

Mfg/Operations

Market/Sales

R&D

Quality

Biologicals

Cust. Service

Rapid Diag.

Legal/Reg.

Distribution

Rapids

Scott A. Snell, Cornell University

C2

= R

apid

Lea

rnin

g

HR

LegalMIS

Biologicals

FinQuality

TMT

R&D

Manufacturing/Operations

Distribution

Sales

Sales

TMT

CustServ

HR

R&D

Rapids

Fin

CustomerService

Mfg

R&D

R&DPartners

TRADITIONAL JOB-BASED

EMPLOYMENT

ALLIANCE/ PARTNER

CONTRACT WORK

KNOWLEDGE WORK

Low VALUE highLow VALUE high

Low

U

NIQ

UE

h

igh

Low

U

NIQ

UE

h

igh

BIOTECH, INC: Mapping Human Capital

KEY Finance

HR

TMT

MIS

Mfg/Operations

Market/Sales

R&D

Quality

Biologicals

Cust. Service

Rapid Diag.

Legal/Reg.

Distribution

KEY Finance

HR

TMT

MIS

Mfg/Operations

Market/Sales

R&D

Quality

Biologicals

Cust. Service

Rapid Diag.

Legal/Reg.

Distribution

Rapids

Scott A. Snell, Cornell University

C2

= R

apid

Lea

rnin

g

HR

LegalMIS

Biologicals

FinQuality

TMT

Employment Mode: partnership

Employment Relationship: collaborative

Examples: “wild ducks” (IBM)

design engineers (w/ Boeing)

trainers (Merck/Forum)

authors (McGraw-Hill)

High ValueHigh ValueLow ValueLow Value

Unique

GenericGeneric

CoreCoreIdiosyncraticIdiosyncratic

AncillaryAncillary CompulsoryCompulsory

Human Capital ArchitectureHuman Capital Architecture

Idiosyncratic Human Capital

• Low Strategic Value: Intermittent link to competence• High Uniqueness: Specialized knowledge and skills

Idiosyncratic Human Capital

• Low Strategic Value: Intermittent link to competence• High Uniqueness: Specialized knowledge and skills

TRADITIONAL JOB-BASED

EMPLOYMENT

ALLIANCE/ PARTNER

CONTRACT WORK

KNOWLEDGE WORK

S-specific job

T&D-short-term

T&D-current job

T&D-external$-internal equity

S-immediate perform$-group

Job-narrow/simple

$-short-term

PA-quality

Job-customized$-bonus

$-performance

$-industry experience

S-strategy contribute$-salary

Job-rotationS-solve problems

S-best

Job-security

$-high

Job-empowerPA-strategy contribute

T&D-investment

PA-work w/othersT&D-OJT

T&D-team

T&D-continuousS-potential

S-promote w/inPA-develop

Job-dynamic

Job-standardized

$-hourly

KEY Job design

Staffing

Training

Appraisal

Compensation

KEY Job design

Staffing

Training

Appraisal

Compensation

Low VALUE highLow VALUE high

Low

UN

IQU

E

hig

hL

ow

U

NIQ

UE

h

igh

Plotting HR Practices

STUDY:152 multi-product firms

>200 employeesCEO, VPHR, line execs

STUDY:152 multi-product firms

>200 employeesCEO, VPHR, line execs

Lepak & Snell, 2001Lepak & Snell, 2001

RewardsRewards

AppraisalAppraisal

DevelopmentDevelopment

StaffingStaffing

Job DesignJob Design • enriched & empowered• customized

• aptitude (able to learn)• promote from within

• continuous on-the-job• firm-specific

• focus on strategic contribution • developmental• external equity (high wages)• pay for knowledge, experience, seniority• ownership and perks

COMMITMENT-BASED HRM SYSTEM

High ValueHigh ValueLow ValueLow Value

Unique

GenericGeneric

IdiosyncraticIdiosyncratic

AncillaryAncillary CompulsoryCompulsory

Human Capital Architecture

Core

Core Human CapitalEmployment Mode: knowledge work

Employment Relationship: organization-focused

RewardsRewards

AppraisalAppraisal

DevelopmentDevelopment

StaffingStaffing

Job DesignJob Design • clearly defined• moderately empowered

• external recruitment• achievement

• limited to firm-specific • short-term focus

• developmental• focus on performance

• external equity (market rate)• pay for performance

High ValueHigh ValueLow ValueLow Value

Unique

GenericGeneric

CoreCoreIdiosyncraticIdiosyncratic

AncillaryAncillary

Human Capital ArchitectureHuman Capital Architecture

Compulsory

PRODUCTIVTY-BASED HRM SYSTEM

Employment Mode: traditional job

Employment Relationship: job focused

Compulsory Human Capital

RewardsRewards

AppraisalAppraisal

DevelopmentDevelopment

StaffingStaffing

Job DesignJob Design • well-defined• limited scope

• outsourced (perhaps)• contract for a specific task

• limited to rules & procedures

• administrative

• hourly or contract-contingent

High ValueHigh ValueLow ValueLow Value

Unique

GenericGeneric

CoreCoreIdiosyncraticIdiosyncratic

CompulsoryCompulsory

Human Capital ArchitectureHuman Capital Architecture

AncillaryAncillary

COMPLIANCE-BASED HRM SYSTEM

Employment Mode: contract work

Employment Relationship: transactional

Ancillary Human Capital

RewardsRewards

AppraisalAppraisal

DevelopmentDevelopment

StaffingStaffing

Job DesignJob Design• team-based• enriched & autonomous

• ability to collaborate• achievement

• continuous on-the-job• firm-specific

• team-oriented• goal accomplishment

• group-based incentives• contract, salary, pay-for-knowledge

High ValueHigh ValueLow ValueLow Value

Unique

GenericGeneric

CoreCoreIdiosyncraticIdiosyncratic

AncillaryAncillary CompulsoryCompulsory

Human Capital ArchitectureHuman Capital Architecture

COLLABORATIVE HRM SYSTEM

Employment Mode: partnership

Employment Relationship: collaborative

Idiosyncratic Human Capital

Human Capital ArchitectureHuman Capital Architecture

low

U

niq

uen

ess

h

igh

low Strategic Value high

HumanCapital• unique• value

HRMSystem

Employ Mode

Rel

atio

nal E

xcha

nge

Tra

nsac

tiona

l

InternalizationExternalization

Idiosyncratic HC• Mode: Partnership• HR: Collaborative - select on past experience - develop the relationship - evolving scope - rewards for ideas

Core HC• Mode: Knowledge work• HR: Commitment-based - staff based on potential - develop (firm-specific) - extensive pay & benefits - autonomy/self-direction - mistakes are important

Compulsory HC • Mode: Traditional job• HR: Productivity-based - staff based on current skill - less development - market wage - focus on ST performance - mistakes above the water line

Ancillary HC • Mode: Contract work• HR: Compliance-based - standardize/simple (outsource) - focus on rules & procedures - narrow scope - error avoiding - hourly pay

R&D

Manufacturing/Operations

Distribution

Sales

Sales

TMT

CustServ

HR

R&D

Rapids

Fin

CustomerService

Mfg

R&D

R&DPartners

Core Knowledge

Low VALUE highLow VALUE highLo

w

UN

IQU

E

hig

hLo

w

UN

IQU

E

hig

h

BIOTECH, INC: Mapping Human Capital

KEY Finance

HR

TMT

MIS

Mfg/Operations

Market/Sales

R&D

Quality

Biologicals

Cust. Service

Rapid Diag.

Legal/Reg.

Distribution

KEY Finance

HR

TMT

MIS

Mfg/Operations

Market/Sales

R&D

Quality

Biologicals

Cust. Service

Rapid Diag.

Legal/Reg.

Distribution

Rapids

Scott A. Snell, Cornell University

C2

= R

apid

Lea

rnin

g

HR

Legal MIS

Biologicals

FinQuality

TMT

Compulsory Knowledge

Idiosyncratic Knowledge

Ancillary Knowledge

Combination of people and systemsleads to...

Human Capital

Social Capital

OrganizationalCapital

BioTech, Inc.: Intellectual capital

PeopleSystems

KNOWLEDGE- microbiology- biochemistry- bioconjugation- imunodiagnostics

PROCESSES- R&D/Mfg.- bioconjugation- antibody purification- PCR amplification- DNA hybridization- TQM- commercialization

TECHNOLOGIES- immunoassays- ELISA (serum/blood)- rapid diagnostics- DNA based detection

RELATIONSHIPS- CRC-DT, CDC- U.S. Army- World Health Org.- universities- distribution network- employee (science/mkt)

C2 = “Rapid Learning”

PE

OP

LE

SY

ST

EM

S

Core Competence

One flaw in knowledge management is that it often neglects to ask what knowledge to manage and toward what end.

Knowledge should be managed within the context where value is created.

--Tom Stewart

…Link Back To Core Competence.

Low VALUE highLow VALUE high

Low

UN

IQU

E

hig

hL

ow

U

NIQ

UE

h

igh

BIOTECH INC: Mapping Social Capital

TMTTMT

Rapids &Ext. Partner

Rapids &Ext. Partner

R&D &Government

R&D &Government

Quality TeamQuality Team

Production & TMT

Production & TMT

Marketing& Sales

Marketing& Sales

FOCUS ON: • Governance• TMT• Culture• Value Chain• Task Environment• Stakeholders• Remote Environment

FOCUS ON: • Governance• TMT• Culture• Value Chain• Task Environment• Stakeholders• Remote Environment Production &

Raw Mat Sup

Production &Raw Mat Sup

R&D & SuppliersR&D & Suppliers

R&D & Production

R&D & Production

Tech Support & Customer

Tech Support & Customer

R&D & CustomerR&D & Customer

R&D & QualityR&D & Quality

TMT /R&D &U.S. Regulatory

TMT /R&D &U.S. Regulatory

Cust. Service &Customer

Cust. Service &Customer

Culture (TMT)Culture (TMT)

TMT &U.S. R&D *

TMT &U.S. R&D *

TMT &U.S. R&D *

TMT &U.S. R&D *

TMT/R&D &U.S. Mfg.

TMT/R&D &U.S. Mfg.

TMT &U.S. R&D

TMT &U.S. R&D

TMT &Customer

TMT &Customer

R&D &External R&D

R&D &External R&D

GovernanceGovernance

Marketing& Customer

Marketing& Customer

R&D TeamR&D Team

Production & Sales

Production & Sales

MIS & R&D

MIS & R&D

Production TeamProduction Team

Production &Quality

Production &Quality

R&D & SalesR&D & Sales

Sales/TMT &Distributors

Sales/TMT &Distributors

Scott A. Snell, Cornell University

PATTERNS: Explicit --------- Tacit

Transactional ---------- Relational Effectiveness ---------- Efficiency

PATTERNS: Explicit --------- Tacit

Transactional ---------- Relational Effectiveness ---------- Efficiency

Low VALUE highLow VALUE high

Low

UN

IQU

E

hig

hL

ow

U

NIQ

UE

h

igh

Mapping Organizational Capital

FOCUS ON: • Databases• Patents• Processes• Systems• Manuals

FOCUS ON: • Databases• Patents• Processes• Systems• Manuals

LN: FeelingsLN: Feelings

LN: Sexions(Suggestions)

LN: Sexions(Suggestions)

LN: Gen NewsLN: Gen News

LN: Contact Database

LN: Contact Database

LN: Research Databases (20+)

LN: Research Databases (20+)

R&D Process

R&D Process

Production Plate Coating

Production Plate Coating

LN: New Products

LN: New Products

Product Improvement

Product Improvement

LN: CustomerIndustry News

LN: CustomerIndustry News

Production Processes

Production Processes

QualityQuality

ShippingShipping CustomerService

CustomerService

ManagementInfo. System

ManagementInfo. System

PatentsPatents

Scott A. Snell, Cornell University

Biotech, Inc.

CORE

ENABLINGSUPPORTING

LINKING

Summary Points

Mapping human capital helps structure the conversation.

Different types of human capital are (should be) managed in different ways.

In addition to HC, there are social and organizational dimensions of IC.

The architecture of these knoweldge-based assets underlies a firm’s core competence.

Human Capital ArchitectureHuman Capital Architecture

low

Un

iqu

en

es

sh

igh

low Strategic Value high

HumanCapital• unique• value

HRMSystem

EmployMode

Rel

atio

nal

Exc

hang

eT

ran

sact

iona

l

InternalizationExternalization

Idiosyncratic HC• Mode: Partnership

• HR: Collaborative- select on past experience- develop the relationship- evolving scope- rewards for ideas

Core HC• Mode: Knowledge work

• HR: Commitment-based- staff based on potential- develop (firm-specific)- extensive pay & benefits- autonomy/self-direction- mistakes are important

Compulsory HC • Mode: Traditional job

• HR: Productivity-based- staff based on current skill- less development- market wage- focus on ST performance- mistakes above the water line

Ancillary HC • Mode: Contract work

• HR: Compliance-based- standardize/simple (outsource)- focus on rules & procedures- narrow scope- error avoiding- hourly pay

CheckpointCheckpoint

Combination of people and systemsleads to...

Human Capital

Social Capital

OrganizationalCapital

BioTech, Inc.: Intellectual capital

PeopleSystems

KNOWLEDGE- microbiology- biochemistry- bioconjugation- imunodiagnostics

PROCESSES- R&D/Mfg.- bioconjugation- antibody purification- PCR amplification- DNA hybridization- TQM- commercialization

TECHNOLOGIES- immunoassays- ELISA (serum/blood)- rapid diagnostics- DNA based detection

RELATIONSHIPS- CRC-DT, CDC- U.S. Army- World Health Org.- universities- distribution network- employee (science/mkt)

C2 = “Rapid Learning”P

EO

PLE

SY

ST

EM

S

Core Competence

R&D

Manufacturing/Operations

Distribution

Sales

Sales

TMT

CustServ

HR

R&D

Rapids

Fin

CustomerService

Mfg

R&D

R&DPartners

TRADITIONAL JOB-BASED

EMPLOYMENT

ALLIANCE/ PARTNER

CONTRACT WORK

KNOWLEDGE WORK

Low VALUE highLow VALUE high

Low

U

NIQ

UE

h

igh

Low

U

NIQ

UE

h

igh

BIOTECH, INC: Mapping Human Capital

KEY Finance

HR

TMT

MIS

Mfg/Operations

Market/Sales

R&D

Quality

Biologicals

Cust. Service

Rapid Diag.

Legal/Reg.

Distribution

KEY Finance

HR

TMT

MIS

Mfg/Operations

Market/Sales

R&D

Quality

Biologicals

Cust. Service

Rapid Diag.

Legal/Reg.

Distribution

Rapids

Scott A. Snell, Cornell University

C2

= R

apid

Lea

rnin

g

HR

LegalMIS

Biologicals

FinQuality

TMT

Dynamique Yachts

KnowledgeIntegration

KnowledgeIntegration

HumanCapital

SocialCapital

OrganizationCapital

Cor

e C

ompe

tenc

e..

.a b

und

le o

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ills

and

tech

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am

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Hum

an R

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Man

agem

ent

Pra

ctic

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taff

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tra

inin

g, w

ork

desi

gn,

part

icip

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n, r

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ards

, ap

pra

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l, et

c.

Hum

an R

esou

rce

Man

agem

ent

Pra

ctic

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taff

ing,

tra

inin

g, w

ork

desi

gn,

part

icip

atio

n, r

ew

ards

, ap

pra

isa

l, et

c.

Systems

KnowledgeCreation

KnowledgeCreation

Intellectual Capital

Dynamic Capability

People

KnowledgeTransfer

KnowledgeTransfer

Learning and Innovation

FlowFlow

StockStock

ChangeChange

Processes to integrate, reconfigure, gain, and release resources—to match and even create market change. RenewalRenewal

ValuableValuable

RareRare

InimitableInimitable

OrganizedOrganized

Model of Strategic HRM

Unique