What is the Yang Triangle?
Recently, while reading, I came across a term—the "Yang Triangle." Staying true to my principle of "never letting things go unexplored," I decided to delve deeper into it.

The company we work for is an organization, and the strength of its organizational capability may depend on factors such as processes, human resources, and efficiency. Organizational capability is the collective combat strength a team can exert—a critical force that enables the team to outperform competitors and create essential value for customers.

Organizational capability has the following characteristics:

• Uniqueness: It is deeply embedded within the organization and not reliant on individuals.

• Sustainability: It consistently influences the company's development.

• Relevance: It is inextricably linked to the company's achievements.

Renowned contemporary Chinese management scholar Yang Guo'an (Arthur Yeung) believes that cultivating organizational capability requires an outside-in perspective and must align with strategy. Thus, he proposed the "Yang Triangle."

Specifically, the "Yang Triangle" consists of three components:

1. Employee Capability (Can they?)
   All employees must possess the knowledge, skills, and qualities required to execute the company's strategy and build the necessary organizational capability. In other words, can employees make decisions and take actions aligned with organizational capabilities (e.g., innovation, cost leadership, service, etc.)?
   This can be summarized as: recruitment, talent pool, training, and role alignment.

2. Employee Mindset (Will they?)
   Knowing how to do something doesn’t mean employees are willing to do it. Hence, the second pillar of organizational capability is employee mindset—ensuring that what employees care about, pursue, and prioritize daily aligns with the company's desired organizational capability.
   This can be summarized as: values, motivation, and cultural guidance.

3. Employee Governance (Are they allowed?)
   Even with the right capabilities and mindset, employees need effective management resources and institutional support to fully utilize their strengths and execute the company's strategy.
   This can be summarized as: processes, information flow, organizational structure, and authority-responsibility relationships.
   
   

Today, we operate in an unpredictable market environment. How can companies achieve sustainable development? Arthur Yeung, Philips Chair Professor of Human Resource Management at CEIBS and President of the Organizational Capability Learning Alliance, provides the answer: "Build a team's combat strength to quickly adapt to external changes."

Moreover, the right organizational capability is one of the two key factors for sustained corporate success, the other being the right strategy.
"Sustained success = Strategy × Organizational Capability." Only when both factors are maximized can a company achieve success.

So, what is the relationship between organizational capability and strategy? How is organizational capability identified, and how can it be systematically built? Arthur Yeung’s years of dedicated research culminated in the unique "Yang Triangle" framework, which systematically addresses these questions.