There’s lots of buzz about the “hard side” and the “soft side” in business today.

The hard side. For two centuries, “hard side” thinking has dominated business. Harnessing logic and data, physics and mathematics, hard side companies have generated a technological revolution.

The hard side world is a clock. Successful companies are machines, conceived by engineers and watched over by accountants to assure maximum productivity at minimum cost. If it can’t be quantified, it isn’t important. Workers are interchangeable parts in the organizational machine. “Human resources” suggests that workers are regarded as mere raw materials.

The soft side. Companies on the cutting edge today challenge these hard side assumptions. From their perspective, the world is not as a clock but a rain forest. Business enterprises are not machines, but ecosystems whose survival depends on successful interactions with other ecosystems in a vast rain forest -- the global economy.

Cutting-edge companies. Cutting edge companies are knowledge-based. Knowledge is carefully collected from and redistributed among employees, who, themselves, have become the company’s most valuable assets -- no longer mere raw material. How workers contribute to and utilize the company’s valuable shared knowledge is an important measure of job performance.

Cutting edge companies stress teamwork. Individual achievement has given way to working relationships; independence to interdependence; self-absorption and self-reliance to networking and connectedness. Indeed, the computer’s ultimate contribution may not be quantification at all, but connectedness and communication through the Internet.

Engaging Employee Emotions. Hard side companies caution workers to leave their emotional lives outside the gate—except for fear and greed. Other emotions are suspect, “touchy-feely”, weak, a sign of insufficient self-control. Feelings could clog the machine. As a result, hard side workers feel detached, isolated, and too often depressed.

Freud taught that love and work are our principal sources of meaning and self esteem. A classic study concludes that the most important source of employee morale is not the paycheck but a sense of accomplishment and recognition for that accomplishment. Cutting edge companies engage and leverage worker emotions on the job. Their emotional engines energize the system and generate gut loyalty to the company. Sam Walton understood this. Strong family-owned companies understand this better than most.

A heads up: Strong family companies are the most formidable competitors in the marketplace. Core family assets of trust, love, and loyalty permeate the workplace. “Soft”? Sure, but who’s embarrassed by their success?

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