Most business people know what intellectual capital is, and they are familiar with the concept of social capital. However, far fewer business people have heard of the newer concept of psychological capital. This is must-learn. Research has shown that that embedding the drivers of psychological capital in a work culture can not only foster happy, healthy employees, but it can also play a significant role in achieving excellent performance.
Psychological capital, or PsyCap, is form of capital that involves the personal resources people bring to their jobs. In much the same way that a cake is a combination of simpler ingredients such as flour, sugar, eggs and milk, PsyCap involves the combination of four basic ingredients – hope, optimism, confidence and resilience. Research has shown that individually each of these ingredients can lead to desirable organizational outcomes, such as good health, persistence on difficult tasks and job performance, but together they represent an even more powerful resource than any of the ingredients on their own. Embedding the drivers of psychological capital in an organization’s culture is a smart way to promote a thriving organization.