What level is your Organizational Equity?

I found this while going through some old posts i had written a few years ago.
I should re-cycle some of the old blogs, just incase i lose some of the old blogs... :-)


What level is your Organizational Equity?

According to “Build your Organizational Equity” published in “Strategy + Business”, a Booz Allen Hamilton Inc magazine, issue of summer 2003, “organizational equity” is one of the most neglected aspects of career building.

The writer, Art Kleiner, classifies the employees of any organization into two groups. One group, called the “Core group”, consists of the top layer of employees such as CEO, CFO, important personnel such as union leaders. This group is generally the policy making group of any organization and accounts for less than 5 % of the total number of employees working in the organization. The second and less prominent group, accounting for the rest of the organization, is the “transactional group”. The members of this group have no or little-input in the policy matters and basically only transact the policy into implementation. Organizations view such groups are replaceable and largely unimportant to decision making.

So, no one wants to be stuck in the second group. Following orders is boring and does not allow your creativity to emerge. According to the author, the best method of moving from transactional group to core group is to strength your organizational equity, defined as “any share of accumulated wealth, including such intangible forms of social capital as relationships and reputation.”

Now the author gives some good examples, which I have found lead not only to organizational success, but also success in life because the world in which we live in is, after all, a huge organization.

•Fungible Financial Equity: This is the financial part of the equity and is most tangible. Having enough financial assets gives you the choice of starting your own company or not working for sometime. Experts recommend saving enough money, either in saving account or some other method, to sustain yourself and your dependents for at least 9 months without a job. Getting to a threshold is critical since once you achieve that goal, savings become capital and pay large enough dividends for a comfortable lifestyle.

•Rainmaking Equity: This is the ability to be the rainmaker of the organization. Can you achieve something no other person in the organization can such as closing that large contract or building a strong department? Rainmaking qualities are hard to attain but it is not impossible.

•Credential Equity: This is the most visible form of your organizational equity. Degrees and certifications help build this equity. The most evident obstacle is the high-expense and time required to maintain this equity.

•Reputation Equity: The writer explains, “You build your reputation less through the accomplishments you stack up (what you do) than through the way you operate in life (who you are).” Consultants, lawyers, doctors make their careers on this equity.

•Relationship Equity: The most commonly understood quality in organizations, it all depends on ‘who you know and how well do you know vs. what you know’.

•Capability Equity: This is the ability to learn more skills and capabilities to add into your already existing equities. Having capability to learn is widely searched for in interviews.