**7.1. Spoil them and let them fail**

and sectors enhances the knowledge sharing and utilisation, which in turn increase innovation (see **Figure 1**). Therefore, knowledge sharing plays an important role in innovation imperatives. Encouraging knowledge sharing between employees and incorporating KM into strategies lead to gain competitive advantage, customer focus and innovation [24, 31]. Organisations also could trigger off the sharing, application and the deployment of knowledge to facilitate innovation, because KM has a positive effect and contribution to transform tacit knowledge into innovative products, services and processes, which improve innovative performance as shown in **Figure 1**. Some studies showed that there is a relationship between organisational innovation and knowledge transfer as well as reverse knowledge transfer, but its effect depends heavily on learning orientations [24]. In gist, two key elements are important in the definition. From the review of the literature, there is evidence that knowledge is the

In a nutshell, strategic human capital practices are deployed in Smart Manufacturing and Industrial 4.0 revolution to ensure a competitive advantage by focusing extensively towards the human capital and build the knowledge base for a sustained growth. From the strategic human capital management perspective, a set of integrative human capital practices that sup-

Human capital management in the Smart Manufacturing and Industry 4.0 revolution provide workers with clearly defined and consistently communicated performance expectations. In Smart Manufacturing and Industry 4.0 revolution, managers are responsible for evaluating their employees' performance. This evaluation takes into account a fair rating, rewards and holds worker accountable for achieving specific business goals. The sole aims of such evaluation is crafting innovation and supporting continuous improvement). In Smart Manufacturing and Industry 4.0 revolution, human capital management is viewed as an approach to organisation staffing that values workers as assets. Such organisation perceives human capital as assets whose current value can be measured and future value can be enhanced through investment [32]. Human capital acts as a catalyst to increase productivity in Smart Manufacturing and Industry 4.0 revolution. Smart Manufacturing and Industry 4.0 revolution cannot survive if there are no human capital with the necessary skills, knowledge and abilities to transform concepts and abstracts thinking into reality that add value to the organisation. The success or failure of Smart Manufacturing and Industry 4.0 revolution depends entirely on how human capital contributes in his or her own way in its success and productivity. Human capital represents the collective value of Smart Manufacturing and Industry 4.0 revolution's competencies, knowledge and skills. This renewal is the source of creativity and innovation that imparts to Smart Manufacturing and Industry 4.0 revolution, the ability to change. Workers are the facilitators who stimulate the physical, inert forms of knowledgeable human capital and the docile forms of tangible capital, materials and equipment to improve Human capital as the most vital

port organisation's strategy produces a sustainable competitive advantage (**Figure 1**).

**7. Rewarding human capital in Smart Manufacturing and Industry** 

core component of innovation – not technology or finances.

52 Digital Transformation in Smart Manufacturing

**4.0 revolution**

Like parents who rejoice their children's chaos: show your creative absolute encouragement and inspire them to do the illogical and flop. Innovation can originate from uncertainty, risk and experimentation if you know it will work, it is not creative. Creative people are the natural experimenters, so let them try and test and play. This is because there are costs associated with experimentation but these are lower than the cost of not innovating [32].

## **7.2. Surround them by semi-boring people**

Managers must not find themselves doing the worst by forcing a creative employee to work with someone like them. Such action is likely to flop because employees will compete for ideas, brainstorm eternally or simply ignore one another at the end. That being said, managers should not surround creative worker with colleagues who are really boring or conventional, they would not understand them and fall out. In line with this, recent research suggests that teams consist of diverse members who are open to take each other's viewpoint and perform most creatively [32].

The response, then, is to support creative workers with their colleagues who are too conventional to challenge their ideas, but unconventional enough to collaborate with them. These colleagues will need to pay attention to details, mundane executional processes and do the dirty work.

### **7.3. Involve them in meaningful work**

Innovators naturally tend to have more vision. They see the bigger picture and able to comprehend why things matter (even if they cannot explain it). The downside to this is that they simply will not involve in worthless work. This all or nothing approach to work reflects the bipolar character of creative artists, who perform well only when is fuelled by value. This approach can also apply to other employees because everyone is more creative when driven by their honest interests and a hungry mind.

At the same time, in any organisation there are employees who are less interested in, well, doing interesting work; they are satisfied with simply clocking in and out and are incentivized by external rewards. Organisations should ensure that frivolous or meaningless work is assigned to these employees [32].

complex rather than vice-versa. Instead of searching for the solutions to a problem, they usually prefer to generate a thousand solutions or a thousand problems. It is therefore necessary that managers keep surprising their creative employees; failing that, managers should at least

Human Capital in the Smart Manufacturing and Industry 4.0 Revolution

http://dx.doi.org/10.5772/intechopen.73575

55

"Most of the problem in this world is as a result of people seeking to be important" in organisation. And the reason is that others fail to appreciate their worth. Justice is not treating everyone the same, but like appreciating and giving them what they are worth. Every organisation has high and low potential employees, but only competent managers and leaders can identify such employees. If managers or leaders fail to recognise such employees' creative potential, employees will switch to other organisations where they feel more valued in terms of contributions [32]. Therefore, in Smart Manufacturing and Industry 4.0 revolution, organisations need to change their way of rewarding and managing these new generations of employees in

*A final warning*: Being able to manage your creative employees perhaps may not mean that managers should let creative employees manage others. Evidence suggests that natural innovators or inventors are hardly talented with leadership skills to warrant them handed leadership of other fellow employees. This is because the profile for good leaders and those of creative people are rather different. Example of such creative people who could not relate well with other people, but doing well with gadgets can be drawn from Steve Jobs. In addition, most Google engineers are completely not interested in the position of leadership or management. It is been proven that the orthodox view that corporate innovators or intrapreneurs demonstrate many of the psychopathic features that inhibit them from being successful leaders: they are uncontrollable, anti-social, self-seeking and often too low in responsiveness to other employees' welfare. But if these creative employees are managed well, motivated and

The chapter provides a strong evidence of the important role human capital plays in the Smart Manufacturing and Industry 4.0 revolution. In Smart Manufacturing and Industry 4.0 revolution, the success or failures of most organisations largely depend on how their human capital is managed. This is because Smart Manufacturing and Industry 4.0 revolution provides a space where employees to machines interactions are the order of the day. There is interconnectedness among various players and actors. The interfaces created become the connecting points between workers and machines. The features of Smart Manufacturing and Industry 4.0 revolution require creative and inventive workers. These are workers who are not creative but also knowledgeable and have techno how to work in such environments. Such workers are nurtured through an education system, where creativity, inventiveness, knowledge and

let them generate enough chaos to make their own lives less predictable.

incentivized, then their inventions will delight many [32, 34].

technology flourish and entrenched in the national culture.

**7.7. Make employees feel important**

order to successfully compete.

**8. Conclusion**

#### **7.4. Eliminate pressure from employees**

Smart Manufacturing and Industry 4.0 revolution require that workers be given more freedom and flexibility at work as this usually enhances creativity, which is a precursor innovation. It cautions managers in Smart Manufacturing and Industry 4.0 revolution against leaning towards structure, order and predictability, terming such managers as probably not creative. This is because workers are more likely to perform more creatively in spontaneous and unpredictable situations. Managers should not constrain creative employees or force them to follow processes, rules, procedures or structures. Smart Manufacturing and Industry 4.0 revolution require workers to work remotely and outside normal hours; the emphasis is managers must not ask where employees are, what they are doing or how they do it. Workers left to decide what, when and how to perform a particular task is the calibre of employees needed in Smart Manufacturing and Industry 4.0 revolution.

#### **7.5. Do not overpay employees**

There is evidence suggesting a relationship between intrinsic and extrinsic motivation. Over the past two decades, psychologists have provided persuasive support for the so-called "over-justification" effect, namely the process whereby higher external rewards weaken performance by lowering a person's genuine or intrinsic interest [32]. Most notably, two largescale meta-analyses reported that, when tasks are naturally meaningful (and creative tasks are certainly in this condition), external rewards weaken commitment. This is true in both adults and children, especially when people are rewarded merely for performing a task. However, providing positive feedback (praises) does not harm intrinsic motivation, so long as the feedback is perceived as honest. The moral of the story! The more you pay people to do what they love, the less they will love it. In the words of Czikszentmihalyi [33]:

*"The most important quality, the one that is most reliably present in all creative individuals, is the ability to enjoy the process of invention for its own sake"* [33].

More significantly, workers with talent for innovation are not motivated by money. Evidence suggests quite clearly that the more imaginative and inquisitive workers are, the more they are motivated by appreciation and absolute logical inquisitiveness rather than commercial needs.

### **7.6. Surprise employees**

Few things are as frustrating to creative as tediousness. The characteristics of creative people are that they naturally seek persistent change, even when it is of less value. They take a different route to work every day, sometimes they get lost on the way and never repeat an order at a restaurant or hotel, even if they really loved it. Creativity is linked to higher tolerance of ambiguity [32, 34]. Creative and inventor love complexity and like making simple things complex rather than vice-versa. Instead of searching for the solutions to a problem, they usually prefer to generate a thousand solutions or a thousand problems. It is therefore necessary that managers keep surprising their creative employees; failing that, managers should at least let them generate enough chaos to make their own lives less predictable.

#### **7.7. Make employees feel important**

At the same time, in any organisation there are employees who are less interested in, well, doing interesting work; they are satisfied with simply clocking in and out and are incentivized by external rewards. Organisations should ensure that frivolous or meaningless work is

Smart Manufacturing and Industry 4.0 revolution require that workers be given more freedom and flexibility at work as this usually enhances creativity, which is a precursor innovation. It cautions managers in Smart Manufacturing and Industry 4.0 revolution against leaning towards structure, order and predictability, terming such managers as probably not creative. This is because workers are more likely to perform more creatively in spontaneous and unpredictable situations. Managers should not constrain creative employees or force them to follow processes, rules, procedures or structures. Smart Manufacturing and Industry 4.0 revolution require workers to work remotely and outside normal hours; the emphasis is managers must not ask where employees are, what they are doing or how they do it. Workers left to decide what, when and how to perform a particular task is the calibre of employees

There is evidence suggesting a relationship between intrinsic and extrinsic motivation. Over the past two decades, psychologists have provided persuasive support for the so-called "over-justification" effect, namely the process whereby higher external rewards weaken performance by lowering a person's genuine or intrinsic interest [32]. Most notably, two largescale meta-analyses reported that, when tasks are naturally meaningful (and creative tasks are certainly in this condition), external rewards weaken commitment. This is true in both adults and children, especially when people are rewarded merely for performing a task. However, providing positive feedback (praises) does not harm intrinsic motivation, so long as the feedback is perceived as honest. The moral of the story! The more you pay people to do what they

*"The most important quality, the one that is most reliably present in all creative individuals, is the* 

More significantly, workers with talent for innovation are not motivated by money. Evidence suggests quite clearly that the more imaginative and inquisitive workers are, the more they are motivated by appreciation and absolute logical inquisitiveness rather than commercial needs.

Few things are as frustrating to creative as tediousness. The characteristics of creative people are that they naturally seek persistent change, even when it is of less value. They take a different route to work every day, sometimes they get lost on the way and never repeat an order at a restaurant or hotel, even if they really loved it. Creativity is linked to higher tolerance of ambiguity [32, 34]. Creative and inventor love complexity and like making simple things

assigned to these employees [32].

54 Digital Transformation in Smart Manufacturing

**7.5. Do not overpay employees**

**7.6. Surprise employees**

**7.4. Eliminate pressure from employees**

needed in Smart Manufacturing and Industry 4.0 revolution.

love, the less they will love it. In the words of Czikszentmihalyi [33]:

*ability to enjoy the process of invention for its own sake"* [33].

"Most of the problem in this world is as a result of people seeking to be important" in organisation. And the reason is that others fail to appreciate their worth. Justice is not treating everyone the same, but like appreciating and giving them what they are worth. Every organisation has high and low potential employees, but only competent managers and leaders can identify such employees. If managers or leaders fail to recognise such employees' creative potential, employees will switch to other organisations where they feel more valued in terms of contributions [32]. Therefore, in Smart Manufacturing and Industry 4.0 revolution, organisations need to change their way of rewarding and managing these new generations of employees in order to successfully compete.

*A final warning*: Being able to manage your creative employees perhaps may not mean that managers should let creative employees manage others. Evidence suggests that natural innovators or inventors are hardly talented with leadership skills to warrant them handed leadership of other fellow employees. This is because the profile for good leaders and those of creative people are rather different. Example of such creative people who could not relate well with other people, but doing well with gadgets can be drawn from Steve Jobs. In addition, most Google engineers are completely not interested in the position of leadership or management. It is been proven that the orthodox view that corporate innovators or intrapreneurs demonstrate many of the psychopathic features that inhibit them from being successful leaders: they are uncontrollable, anti-social, self-seeking and often too low in responsiveness to other employees' welfare. But if these creative employees are managed well, motivated and incentivized, then their inventions will delight many [32, 34].
