Investing and Developing Positive Capacities

{Luthans, Youssef, & Avolio, 2007. Psychological Capital: Investing and Developing Positive Organizational Behavior. In Nelson & Cooper (Eds.), Positive Organizational Behavior.}

Focusing on the elements that contribute to flourishing in addition to what makes individuals fail brings a more balanced approach to studying the essence of human functioning and behavior, with implications for direct application in the workplace, including the micro-level of employee development and performance and the macro organizational issues. Psychological capital is proposed as a construct that can be developed and managed for performance impact.

Positive organizational behavior, or POB, was introduced as “the study and application of positively-oriented human resource strengths and psychological capacities that can be measured, developed, and effectively managed for performance improvement in today’s workplace” (Luthans, 2002). This positivity is conceptualized as the higher-order construct of psychological capital.

Economic capital is what you have as finances or tangible assets (plant, equipment, patent, data) and is evaluated as debit and credit money, production capacity, installed kWh or BTU, etc.

Human capital points to what you know and can do, shown in your experience, education, skills, knowledge, and ideas. It can be measured and evaluated as strengths, health, vitality, career success, compensation, succession, turnover, job search, job fit, etc.

Social capital is who you know with relationships, a network of contacts, friends, and trust. Its measures are a network’s size, structure, and composition; organizational leadership, entrepreneurship, and the learning organization; organizational fit; inter-unit resource exchange, supplier relations, and industry networks.

Positive psychological capital is who you are, pointing to how you got here and how you have built your confidence, hope, optimism, and resilience. Its measures and evaluations concern job satisfaction, citizenship behavior, and engagement; culture fit. It is built at work by getting engaged and absorbing in flow.

Hope is associated with positive expectancy toward the future. It has been defined as a positive motivational state derived from a successful agency and the belief in one’s ability to set goals and accomplish them. Hope is developed through goals and pathways design and obstacles planning.

Optimism is a cognitive process directed at positive outcomes or expectancies concerning the social and material future, seen as desirable and advantageous. Optimism interventions aim to affect optimism’s efficacy and hope dimension.

Resiliency is an individual’s capability to successfully cope with change, adversity, or risk and deal with uncertainty or conflict with increased responsibility. Resiliency is developed by building assets, avoiding hazards, protecting vulnerabilities, and affecting the influence [of world events] process.

Self-efficacy refers to an individual’s conviction about his or her abilities to mobilize the motivation, cognitive resources, and courses of action needed to execute a specific task within a given context successfully. It is developed through experiencing success, social modeling, social persuasion, and physiological or psychological arousal.

Hope, optimism, resiliency, and self-efficacy are strengths that lead to healthy life choices and subjective wellbeing as measured by an individual’s overall life quality, pleasures, and pains.

Positive psychological capital, or PsyCap, impacts work-related performance, which separates PsyCap from many positive psychological capacities that are often viewed as ends in and of themselves. PsyCap is state-like and open to development. PsyCap is positive and unique; it is theory-, research-based, and measurable. PsyCap goes beyond human and social capital. It is not just the explicit knowledge, skills, and abilities that simply can be built through education and training programs or on-the-job experience. It is not equivalent to the organization-specific tacit knowledge embedded in the culture and created through socialization processes. It is more than an influential group of contacts or people with whom you have beneficial and functional relationships.

Managing self-efficacy/confidence

Confident individuals trust their abilities, enabling them to choose challenging tasks, invest the necessary time and energy to achieve their goals, and persevere when faced with obstacles and discouraging signals. In addition, the capacities of symbolizing, forethought, observation, self-regulation, and self-reflection allow confident people to purposefully, agentically, and proactively set challenging goals, regulate their motivation and actions, and manage and control their learning processes in anticipation of future success.

Approaches successful in developing self-efficacy and effective efficacy-building techniques have been devised. Mastery experiences enhance self-efficacy, as does vicarious learning or modeling. Vicarious learning capitalizes on observational capacities. Even imaginal experience and taking one’s visualized self succeeding in the task, the imagined self, as the role model can build confidence. Other approaches include social persuasion and physiological/psychological arousal.

For efficacy development to be robust, even when directly experiencing success, one’s perceptions and attributions need to internalize this success. The social, psychological, and physical context can be managed for efficacy enhancement through positive feedback, social recognition, empowerment, and work-life balance.

Managing hope

Hope is developed through people’s sense of agency by increasing their determination to achieve goals and by devising pathways that enable individuals to proactively design alternative pathways and contingency plans to achieve their goals when they face obstacles and blockages.

Effective goal-setting can help develop a sense of agency for accomplishing those goals. Challenging stretch goals can expand one’s skills and horizons without driving the person to despair. Stepping is another technique where goals are broken down into smaller and simpler sub-goals to be accomplished and monitored as milestones toward attaining the greater goal.

One can proactively develop pathways through mental rehearsal, visualizing the integral and most challenging components of goal accomplishment and preparing oneself to overcome essential obstacles. Pragmatic contingency planning and what-if analyses are used for building the pathways component of hope.

Managing optimism

Realistic, flexible optimism is responsible, accountable, and adaptive, considering and learning from positive and negative events and their causes and consequences before taking credit for successes or distancing and externalizing failures.

Leniency for the past, appreciation for the present, and opportunity-seeking for the future form the basis of developing optimism. Understanding what was and is under one’s control and what was and is possibly beyond one’s control can shed light on the realities of a situation. Distinguishing between facts and perceptions is another one. Holding onto feelings of shame and guilt beyond their merit can have a detrimental impact on optimism, paralyzing appreciation of and learning from the positives of a situation and hindering future risk-taking, resulting in stagnation and complacency. Discounting these negative thoughts and feelings realistically and replacing them with optimistic, positive ones should lead to a better future.

Managing resiliency

Resiliency effectively manages resources toward a more fortunate life despite risks and adversities. At the individual level, it is a class of phenomena characterized by patterns of positive adaptation in the context of significant hardship or risk. At the organizational level, it involves the structural and processual dynamics that equip an organization with the capacities necessary to absorb strain, retain coherence, and bounce back, thus enabling the ongoing engagement of risk.

The strategies for developing resiliency are classified as asset-, risk-, and process-focused. Accumulating various types of assets, including structural, financial, and technological assets at the organizational level and human, social, and psychological capital at the individual level, can help mitigate risk factors at times of adversity. Risk-focused strategies proactively reduce exposure to risk through protective mechanisms by avoiding unnecessary or exaggerated risks that can jeopardize their wellbeing.

Process-focused strategies emphasize the dynamic interaction between assets and risks. Effective handling of adversities and setbacks can result in bouncing back beyond one’s original performance level into unexpected realms of learning and growth. Proactively engaging in calculated risks and capitalizing on assets can transform those risk factors into opportunities for future growth and development. Facing difficulties and effectively dealing with hardships may be necessary for resiliency development.

Health Benefits of Optimism

{Rasmussen & Wallio, 2008. The Health Benefits of Optimism. In Lopez (Ed). Positive Psychology: Exploring the Best in People. (Vol. 1) Discovering Human Strengths}

Personal Mini-Experiments: Optimism All Around You

How Optimistic Are You?

Complete the Life Orientation Test-Revised (LOT-R) to learn about your dispositional optimism level.

You can also take an optimism test and other questionnaires after registering at

Finding the Positive

The next time you face a challenge, generate a list of possible positive outcomes. For example, positive effects might include a quick recovery or growing closer to a family member when you have an illness.

Learn From Another’s Optimism

Interview an individual you feel has a positive outlook who has faced a significant illness or adversity. Interview this person about his or her experience and how he or she remained optimistic in times of stress. Then, focus on incorporating this outlook the next time you face a stressor.

Expressing Yourself Through Writing

The next time you are experiencing a stressor or feeling depressed or anxious, write about your experience. Writing sessions can be short, five or ten minutes, and can be used throughout an ongoing experience.

Mindfulness and Optimism

Develop an awareness of your negative thoughts, feelings, and sensations through conscious attention to them. Engage in nonjudgmental acceptance of these negative reactions, understanding that they are interpretations, not facts, about your experiences. Your reactions are influenced by various factors, including mood and prior learning.

Is Optimism Always Beneficial?

To answer rightfully, we must distinguish between unrealistic optimism versus dispositional optimism or a sense of perseverance and active coping. For example, being extraordinarily cheerful, never seeing the dark side, or never worrying might be indicators of unreasonable optimism.

Some goals are unattainable, and disengaging from such goals may play a beneficial role in effective self-regulation.

It is wise to discern when to remain engaged in dealing with a stressor and when to disengage or give up. Staying engaged with a stressor, even under challenging circumstances, is related to higher cortisol levels and lower immunity. On the other hand, giving up is a protective response that minimizes exposure to stressors and their adverse physiological effects.

Some suggest that for high optimism patients with advanced disease, not having their expectations met may have negative consequences for pain. Conversely, encouraging optimism at the onset of disease and adjusting expectations to be more realistic over time may produce the best health outcomes.

Attributional Theory of Peterson and Seligman (1984): Explanatory Style

Attributional theory refers to explanatory style or how people explain experiences in their lives. People with an optimistic explanatory style attribute problems or barriers to transient or unstable, external, and specific causes. People with pessimistic style attribute problems to stable or permanent, internal, and global causes.

Explanatory style influences how people respond to difficulties. An optimist will see the difficulty as temporary and external to themselves. A pessimist will see the difficulty as permanent and unchangeable.

The research questions concern the mechanisms that lead from explanatory style to adaptational outcomes.

Generalized Outcome Expectancies Framework of Scheier and Carver (1985)

Behavior is goal-directed. Goals are qualities or states viewed as desirable or undesirable. People organize their behavior toward goals they see as valuable or desirable.

In contrast, people try to avoid conditions or qualities they see as undesirable. The desirability of the goal is the value element of the framework. In correspondence with the expectancy-value model of motivation (Carver & Scheier, 2001), the more perceived value of a goal, the more motivated the person is to try to achieve the goal.

People are affected by their beliefs about the probable outcomes of their actions. Expectancy refers to a person’s expectations (confidence or doubt) that they will achieve the goal. If they doubt attaining a goal, they will have little reason to act. On the contrary, if they have gained sufficient confidence about achieving the goal, they will act and continue their efforts even when faced with barriers and hardship.

Physical Health and Subjective Health

Objective health outcomes primarily reflect biological endpoints that can be objectively determined, such as immune parameters or mortality. In contrast, subjective outcomes are primarily self-report measures, such as reports of pain levels or physical symptoms.

Optimism relates to better subjective health measures, such as physical symptom reports. For example, more optimistic samples of older individuals and patient populations report less pain. Groups with higher optimism report less anxiety, less depression, and greater life satisfaction; better sleep quality; reduced postoperative physical fatigue; faster recovery following a significant life event, defined as death or severe illness in the family.

Optimism appears to be a component of emotional intelligence, allowing individuals to develop protective buffers, such as mood, social support, and adaptive interpretations, against the impact of physical stresses.

Optimists are likely to engage in positive health practices, such as exercise and healthy diets, which are generally associated with increased longevity.

In disease conditions, optimists have higher proactive behavior, less avoidant coping, and less depression.

In a study of cardiac surgery patients, at six months, optimists were significantly more likely to have returned to vigorous physical activity and more likely to have a higher quality of life than pessimists.

At the end stages of a disease, optimism is most beneficial for the quality of life rather than extending life duration.

Optimism, Coping, and Health

Optimists and pessimists coped differently with adversity. Expectations are essential in behavioral responses to health threats. People with positive expectations exert continuing efforts at dealing with challenges, even serious health threats. Conversely, those who are pessimistic about the future tend to withdraw effort by pulling away or seeking distractions not aimed at problem-solving.

In a study of cancer patients, pessimists used more cognitive avoidance in coping with the upcoming diagnostic procedure than optimists. This contributed to distress before biopsy and also predicted post-biopsy distress among women with positive diagnoses.

In another study, both before and after surgery, optimism was associated with a pattern of reported coping strategies that involved accepting the reality of the situation, placing as positive a light on the situation as possible, trying to relieve the situation with humor, and (at pre-surgery) taking active steps to do whatever there was to be done. Conversely, pessimism was related to denial and behavioral disengagement (giving up).

Optimists approach problems more effectively by using more active and direct coping strategies. Optimists tend to use more problem-focused coping strategies. Optimists turn to adaptive emotion-focused strategies, such as acceptance, humor, or positive framing, when problem-focused coping is not feasible. Pessimists use such strategies as overt denial and mental and behavioral disengagement from the goals with which the stressor is interfering.