Want to support your employees in succeeding in their careers? We should be focusing much more on improving psychological capital and not just expertise or social relationships, according to a study of Finnish knowledge workers.
For this article we interviewed Maria Järlström, Tiina Brandt, and Anni Rajala on their 2020 publication The relationship between career capital and career success among Finnish knowledge workers.
What kind of a trajectory will your career have? Will your career end abruptly or will you overcome disruptions along the way? Or will you work hard but never get ahead? Your career capital, the resources and relationships you have, can determine how successful a career you will have.
What is career capital?
Career capital is a resource that every one of us can acquire and develop. It makes us stronger leaders of our own careers and helps us succeed in our careers.
Career capital consists of (at least) three distinct forms of personal resources: what you know (your human capital), who you know (your social capital), and who you are (your psychological capital).
Your education and work experience are part of your career capital as they grow your human capital, help you advance in your career, and open up new opportunities. Your professional relationships, networks, and the trust you build with others is the “social” part of your career capital. You can grow it by getting to know people inside and outside your organization and forming relationships with them.
Psychological capital is the third part of your career capital, a personal resource along with your human and social capital. Psychological capital refers to e.g., hope, optimism, resilience, and self-efficacy. Järlström reminds us that “all of these resources that have an impact on your career, psychological capital included, can be improved, which is wonderful”. Career motivation is also part of your career capital. “It helps you to advance in your career if you know yourself and what you want from your career”, Järlström continues.
What makes up your psychological capital?
The following four components of psychological capital have different kinds of effects on your career success and your work and life in general as well as the success of organizations and businesses.
If you have high levels of hope, you are probably goal-oriented and you have the willpower to achieve those goals. You also have confidence in your capability to find means to achieve your goals. Similarly, having a good level of self-efficacy helps you to take on challenges as you trust your capabilities and trust that you will succeed, and also find your personal ways to tackle the challenges if needed.
Optimism helps you to carry on as you have the ability to focus on the successes and see failures as something you pass along the way. Disappointments or failures do not stick so much if you have high levels of optimism. You don’t see failures as part of yourself, as you can take distance from them. You rather learn from mistakes than let them determine who you are or what is possible for you.
Optimism doesn’t mean that you are unrealistic about your abilities or possibilities. It means that you can better recognize the accomplishments of others as well as your own, and take responsibility in difficult situations. You focus on what takes you forward rather than worrying about the past.
Resilience is all about facing difficulties and challenges, positive and negative. It’s about learning from them, bouncing back from them, and having the capacity to overcome them rather than being overwhelmed.
What matters the most for your career to be successful?
Järlström, Brandt, and Rajala started studying the relationship between career capital and career success when they decided to combine two of their long-term interests, career research and psychological capital. They wish to find guidelines from research that would help in leading successful careers. “We hope our research findings help practitioners to focus on the best areas of development for improving career success”, says Maria Järlström.
Their recent research findings shed light on the complexity of leading successful careers. It might not be enough to focus on the traditional aspects of career development.
It would be too easy to assume that for knowledge workers what you know, your education and the occupational experience you have gained, would matter the most. Isn’t it what your resume is made of? Being connected with the right people and getting support from them should also boost your career. With these two forms of career capital in place, you should be able to land your next exciting project or get an opportunity for advancing your career, right?
According to the recent study by Järlström, Brandt, and Rajala, it may not be so. Who you are might be more important than your knowledge, skills, or your network. Their findings suggest that actively investing in your career and developing your expertise may not be enough to boost your career.
It might be that your hard work goes unnoticed, so you don’t get the support from your superiors to progress in your career. This is where psychological capital comes into play. It may be that people with higher levels of psychological capital can better express themselves so that their wishes are heard and their career goals supported—even if they are not as highly skilled or as well connected as others.
But it is not only about being vocal and being heard. In today’s working life, it’s the high levels of hope, optimism, resilience, and self-efficacy that can really make the difference between a disrupted or a successful career. If you are more resilient and can adapt to changes or uncertainties in the work environment, you have a better chance of being successful.
Based on the results of their study, Järlström, Brandt, and Rajala stress the importance of psychological capital for the career success of knowledge workers over human or social capital. Fortunately, psychological capital is not set in stone—you can develop it and thus build your career capital to support a long and successful career.
It pays off to lead careers and build career capital
Maria Järlström emphasizes the significance of leading and managing careers in organizations. She states that “career management is an essential part of quality human resource management, and it also signals that you care and are taking responsibility”.
Employers should, in fact, give more support than before to their employees in career development, career success, and building their career capital. There will be even more competition over the top experts. With great career management, employees can become more committed, and your employer brand can also improve. A person dedicated to their career is also more dedicated to their work, probably more productive, and more willing to develop themself and their skills.
People who have a lot of psychological capital have many advantages in work life, which is also reflected in business success. Psychological capital is connected, for example, with wellbeing and work engagement, which in turn has a lot of positive effects.
Because people with high psychological capital trust their skills and capabilities they have more self confidence also when taking on challenges. They actively strive towards their personal goals, which keeps them moving forward. Their resilience helps them recover quickly from disappointments. These qualities can be learned and strengthened with support from colleagues and supervisors.
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Psychological capital helps also in our constantly changing world and dynamic work environments where people have to be quite versatile and adapt to the changes quickly. It can also mean being open to different kinds of career opportunities and experiences. It may be that psychological capital protects you from negative emotions towards your own career and helps you see the change as an opportunity rather than a threat. Especially in quickly evolving industries, organizations should grow their optimism and other types of psychological capital.
The cross-sectional study by Järlström, Brandt, and Rajala doesn’t reveal if people who have successfully advanced in their careers have naturally more psychological capital or if it has been accrued along the way. It might be that people with successful careers have had more support, e.g., from their supervisors from the get-go, which would have increased their psychological capital. “Some may have had worse luck than others when it comes to superiors or the work community. They might have not been able to show their full potential”, says Brandt. In any case, increasing psychological capital should be supported by supervisors and the whole work community. “If an employee is denied the chance to show their full potential, it may not only be their psychological capital that is hindered. They might also lose their motivation and even their wellbeing may be affected”, Brandt continues.
On the other hand, people who have great psychological capital may be creating a positive atmosphere around them and spreading positivity to others. Supervisors might have the most influence in this sense. “This effect should be noted especially if you’re doing work that requires creativity or innovativeness”, Järlström says. Thus, organizations should also support the psychological capital of people who have already advanced in their careers or who are in supervisory positions.
The strong relation between leadership and growing career capital
It might be effective to start building psychological capital in the organization from the supervisors. “If a supervisor has great psychological capital, they can grow their subordinates’ psychological capital with the power of example alone”, says Brandt. On the other hand, if a supervisor has poor psychological capital, they might even hinder the career development of their subordinates—knowingly or without realizing it. “It might be that the supervisor has personal insecurities or fears of being surpassed by your subordinates”, Brandt continues. To gain the positive effects and reduce such negative behaviour, it is necessary to support the growth of the supervisors’ psychological capital.
If you then want to improve how supervisory work affects the development of psychological capital in the organization, you should explore the opportunities of e.g., business coaching and the ask, listen, encourage -approach. Forming a culture of giving feedback that builds self-esteem can also contribute to psychological capital. It all starts with an atmosphere of encouragement and growth. “We should pay at least equal attention to success as failure and also analyze the reasons behind success. This is something people tend to skip in a hurry“, Järlström notes.
The possibilities of boosting employees’ psychological capital can be assessed for least four different aspects. For example, setting personal goals can increase hope, if the goals are exciting and positively challenging and are also aligned with the strategic goals of the organization. “Usually people want to support their organization. A strategic foundation for your personal goals can offer not only rationale but also a sense of importance for the success of the organization”, Brandt describes. Supervisors have a role in helping people to set such personal goals and taking those goals into account especially if the employee is young or new to the organization and has not formed a clear picture of their organization’s strategy.
Growing optimism has to be done delicately, since hypocrisy or false positivity may hamper it. When done right, growing optimism can create hope for the future, which helps to get through difficult times or challenging situations. Supervisors have a significant role in this too since they can consciously create an optimistic atmosphere by boosting the mood through the use of humour, for example.
Resilience can also be developed and the supervisor can support it too. If an employee is having trouble achieving their personal goals, their supervisor should offer support in handling the disappointment. The support shown by the supervisor may be crucial if you are nearly giving up. The wrong kind of feedback can be demotivating whereas resilience building feedback helps you find new or alternative ways forward and to continue pursuing your personal goals.
Whether you are a new employee or a junior, getting feedback is essential to the formation of your self-efficacy and confidence especially when starting a new job. Receiving feedback alleviates the feelings of insecurity that most people have until they figure out their own strengths and weaknesses in their job. On the other hand, more experienced employees may require motivation to take on new challenges or to develop themselves. “Rather than feeling insecure the risk for seasoned employees is to stay in their comfort zones”, Brandt points out.
Ultimately you are responsible for your own career capital
Even though supervisors and leadership in general has a significant impact on the career capital and psychological capital of employees, one should not rely solely on the organization. “Work is changing so rapidly that everyone should take responsibility for their own career capital”, says Järlström. Situations may change rapidly and the changes may be caused by external forces.
Brandt wants to underline that it is not only about the success of your career. “If you are not that career-focused, you should still think about taking care of your own motivation. Your motivation and wellbeing will stay stronger when you challenge yourself and can feel improving over time”, she points out.
There’s a lot you can do to improve your personal career capital. You should start with getting to know yourself, your wishes, and goals better than before. Who am I? What do I want from my career? What is it about my work and career that motivates and excites me? Brandt recommends that everyone should ponder these questions every once in a while. “You should spend time on improving your self-knowledge and reflecting your personal goals, where you are currently headed and is that direction the right one for you”, Brandt warmly suggests.
To improve your human capital, you should understand what you already know and what would you like to learn? Career capital can be increased by updating your know-how and also by letting yourself get excited about new thighs throughout your career. In a similar manner, you can consciously improve your social capital by growing your network and keeping in touch with people. Who do I want to get acquainted with and why?
What have I succeeded in? What made it possible? How do I react when I face hindrances? How do I recover from failures? In addition to human and social capital, Anni Rajala recommends developing your psychological capital purposefully and to seek support from e.g., coaching, mentoring, or discussions with your supervisor.
Finally, Järlström wants to remind us that psychological capital is not pre-determined and it also fluctuates over time. “This is important to recognize. Everyone can also improve their psychological capital”, Järlström encourages.
How to lead the development of career capital? Keep these in mind:
Don’t forget the basics of good career leadership. Remember to include personal development plans, career paths, mentoring, and coaching. Create opportunities for people to form and strengthen their networks.
Leading careers should not only include human and social capital. Put more emphasis also on developing psychological capital with the means of career leadership.
Try to spot early such employees that require more support for developing their psychological capital. Make sure that their wishes and goals are heard and supported even though they might not be able to actively communicate about them.
It pays off to develop the psychological capital of those who have already advanced in their careers as it may be reflected to others, e.g. their subordinates.
Create an atmosphere and a culture that supports building psychological capital: encourage giving credit and praise, pay attention to successes at least as much as failures, and give feedback to each other that boosts your self esteem.
About the study
The purpose of the study by Järlström, Brandt, and Rajala was to gain understanding on the relationship between career capital and career success among knowledge workers. The focus was on human, social, and psychological capital and their effects on both subjective and objective career success (career satisfaction, promotions). 624 Finnish knowledge workers with an academic degree participated in this study. The researchers found that psychological capital was significantly and positively related to both subjective and objective career success. The results of this study were first published in the Baltic Journal of Management in 2020.
Thank you Maria Järlström, Tiina Brandt, and Anni Rajala for the interview!
Maria Järlström is a lecturer at University of Vaasa and the Programme Manager of the Master's Degree Programme in Human Resource Management. She is interested in the different aspects of human resource management with a focus on strategic human resource management, sustainable human resource management, and career research spanning teaching, training, and research.
Tiina Brandt works at the Haaga-Helia Universitys of Applied Sciences as a researcher. Her topics are leadership, organizational behavior and psychological factors like personality. Recently she has interested also entrepreneurship and innovations. At projects she is working with artificial intelligence with her colleagues.
Järlström, M., Brandt, T., & Rajala, A. (2020). The relationship between career capital and career success among Finnish knowledge workers. Baltic Journal of Management, 15(5), 687–706. https://doi.org/10.1108/BJM-10-2019-0357