HR capacity vs HR capability

Author: Ermath Harrington

June 18, 2023
Manager talking to colleauge

Executives, Senior Management and mid-level employees in organizations possess a collective trove of qualifications and experience that in some instances do not translate into strategic capabilities to support the business through the management of the HR Assets of the organization. There are several reasons that account for the difference in capacity vs capability. These include: The employee building capacity for the wrong or narrow reasons. For example, if you ask the average C-Suite level executive who is either contemplating a higher-level certification (MBA etc) or has just completed this certification, you may find that the repetitive answer (overt or implied) is to move up the corporate ladder. Whereas, nothing is wrong with this intent, but what should go with that intent is a commitment to bring value to the certification obtained by demonstrating one’s capability to add said value.

In many instances over the years in engaging Board Members, C-Suite Executives and Managers, I often ask a question – How many persons in this room have one or more post graduate qualifications? All the hands in the room go up – so lots of organizational leadership capacity in the room. I then ask the question “So why am I here?” and I get dead silence in response. My presence there is to fulfil the capability part of the equation. 

There are instances however where employees have both the capacity and capability to add the requisite value to their roles and functions and by extension benefit the organization. What can hamper this, is an organizational culture that does not recognize, promote or encourage the demonstration of capability for a myriad of reasons (insecurities, egos and agendas etc). With respect to the often verbalized cliché about “organizational fit”, this has nothing to do with either capacity or capability. This has to do with the individual’s alignment with the leadership / organizational agenda, whether this agenda is progressive or not. 

The discussion on HR capacity vs HR Capability is therefore rooted in the difference between KNOW-ledge vs KNOW-how. The root of the conundrum is in the translation of strategic knowledge into operational know-how. Business schools’ curricula and the concomitant learnings are great for knowledge development, however true know-how comes from the extent to which your mind is configured to think realistically and not theoretically, in the context of the organisational situations that are presented to you in the course of your remit as a strategic business leader / manager / employee. In short, the key difference between knowledge and know-how is that knowledge is about capacity and Know-how is about capability.

This also explains how a small company with the embedded know-how (capability) in its leaders, managers and employees can rise and eclipse a large company (capacity) in the market game.  The difference between the capacity filled individual / organization and the capability driven individual / organization will always manifest in the difference in strategic performance outcomes. 

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