What is strategic capital?

10468394699?profile=originalStrategic capital is a critical element of Intangible capital. It can be both an asset and a liability--it all depends on how stakeholders view the performance of your strategic capital.

The strategic capital is how you put the other elements of your intangible capital to work. You can have great people, great systems and processes, great partners—but without the right strategic capital, you have no reason for being.

It all begins with a clear definition of the purpose of your business. Your value proposition needs to make sense when compared with your stakeholders’ needs and the knowledge and resources necessary to meet those needs. To get it right, you need knowledge of your market, your business opportunity and the business model you create to take advantage of that opportunity. And, maybe most importantly, you need to have a culture that serves as the guiding force behind decisions made across your organization.

The right strategy is an asset. This includes knowing what customers you want to serve, how you will serve them, with what products and services, at what prices and how you will attract them, service them and build lasting relations with them. It also involves attracting the right human capital, partners and other resources necessary to fulfill your stated purpose.

The core focus of strategic capital must be, “Do we have the right resources to deliver on our strategy?” These resources include:

1. Human capital that connects with your value proposition and is equipped to deliver on it
2. Structural capital (processes, systems, knowledge) that support your value proposition.
3. Relationship capital including customers at the core of your value proposition and partners who support your ability to deliver.

Intangible capital is a system of moving parts and no one part operates without the other in terms of creating value for the entire organization and all its stakeholders. Strategic capital is a critical part of this system and, like each intangible capital element, can be measured and monitored. Without having a measure and the ability to monitor the progress it is like steering a boat across the ocean with no navigational equipment.

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