Your MBA Lied to You: People Aren't "Labor Inputs" (And Other Economic Truths That'll Make You Rethink Everything)

Open any economics textbook and you'll see it right there in black and white:

Two inputs to production: Capital and Labor.

Capital = machines, equipment, money Labor = humans

And there's your problem. Right there. In the first chapter.

Because the minute you start thinking about your people as "labor inputs" instead of, you know, actual farcking humans, you've already lost the plot.

I sat down with Seung Paik—retired Air Force colonel, keynote speaker, and author of Leadernomics—and he dropped some truth bombs about leadership that every executive needs to hear. Especially if you've been treating your team like line items on a spreadsheet and wondering why they keep leaving for your competitors.

The Framework You Didn't Know You Needed

Here's where Seung's approach gets interesting: he's not giving you another leadership book full of inspirational quotes and vague platitudes about "servant leadership."

He's taking economic principles—sunk cost, opportunity cost, marginal analysis, diminishing returns—and using them as a framework for understanding human behavior in leadership contexts.

"Economics is the study of human behavior, the study of human choice amidst scarcity," Seung explains. "If this is the actual discipline that studies human behavior and decision making, why wouldn't I want this in the area of leadership where it's truly all about relationships between leaders and followers?"

Mind. Blown.

Think about it: You're making decisions all day about resource allocation, time management, investment priorities. But you're probably using economic principles without even realizing it—except you're applying them to everything except the most important resource you have.

Your people.

The Transactional Trap (Or: Why Your "Culture Initiatives" Keep Failing)

Here's the uncomfortable truth Seung lays out: we naturally perceive our people as commodities.

It's not even malicious. It's just what happens when you're under pressure to hit metrics, achieve milestones, and show bottom line results. You start optimizing for performance instead of connection.

"In that process of trying to achieve those bottom line goals and those metrics, we begin to perceive our people as commodities," Seung says. "It's a natural inclination."

But here's where it gets dangerous—and this is the part that'll make you squirm:

You can't checklist your way out of being transactional.

Seung gets this question all the time: "What are the ten things I need to do to become more relational?"

And his response? "You've just missed my point."

The Quid Pro Quo Problem (Why Your 1-on-1s Feel Like Performance Reviews)

This is the insidious part. This is where most "relationship-driven revenue growth" strategies fall apart:

"It happens quickly, where all of a sudden it becomes quid pro quo. It becomes reciprocation. I will treat you as a human because, oh, I was told that if I do that in economics, that the incentives and the motives will lead me to a higher bottom line," Seung warns.

"And the minute you transactionalize it, you start losing the relational aspect and the humanization of it."

Read that again.

You can't treat people like humans because it drives better results. That's still transactional. That's still commodifying the relationship.

You have to treat people like humans because they're farking humans.

Not because Harvard Business Review said it'll improve retention by 30%. Not because it's a "best practice." Not because you read it in some leadership book.

Because it's the right thing to do. Full stop.

The Tale of Two Generals (The Story That'll Haunt You)

Seung worked at the Pentagon under two two-star generals simultaneously. Both came around on Mondays to ask the team how their weekend was.

But that's where the similarity ended.

General #1 (The Transactional One):

• Never made eye contact while asking about your weekend

• Eyes already scanning for the next person

• Never used anyone's first name (always rank)

• Over a year of working together, never knew Seung was married with three kids (and a fourth on the way)

• Fast-tracked for promotion

• Got exactly what he asked for—nothing more

General #2 (The Relational One):

• Always called people by their first names

• Asked about Seung's wife Grace by name

• Checked in on the pregnancy

• Showed up unannounced at a summer intern's farewell potluck

• Knew the intern's name, her fiancé's name, and connected her work to the mission

• Made a 21-year-old intern feel seen by a two-star general

The result?

"There's not a single person in that room that wouldn't have broken through walls, climbed over fences, and leaped rivers to get to the other side for that guy," Seung says.

Everyone said "that's my general" about the second one. Nobody ever said it about the first.

Both got results. But only one got discretionary effort. Only one got loyalty. Only one built authentic client connections that translated into sustainable business expansion strategies.

Don't Count the Clock (The Anti-Checklist Principle)

Here's where Seung's framework diverges from every other leadership book:

Instead of saying "spend 10 minutes with each person on Monday mornings," he says: stop counting.

"It's not about the five or the ten minutes. It could still be one minute, but in that one minute and that 60 seconds, don't count the clock. Just ask them with sincerity."

Your people are smart. They can tell when you're checking a box versus when you actually give a shaet.

They know the difference between:

• "How was your weekend?" [eyes already moving to the next person]

• "How was your weekend?" [genuine curiosity, eye contact, waiting for the answer]

The first is performance theater. The second is human connection in B2B relationships—even though we're talking about internal relationships, not client-facing ones.

(Spoiler: the way you treat your team is exactly how your team will treat your clients. You can't outsource authenticity.)

The Framework vs. The Tools

Seung's not anti-tools. He's anti-overstuffed-tool-bag-with-no-organizing-system.

"I'm not a big fan of this terminology of more tools for your tool bag," he explains. "I'm a big fan of why don't you just get the tool bag itself?"

His framework of ten economic principles becomes the organizing system. Every leadership tool, every strategy, every tactic—it fits somewhere in that framework.

Sunk cost: Stop clinging to decisions that aren't working just because you've already invested time/money/ego Opportunity cost: Every choice you make is also a choice about what you're not doing Marginal analysis: What's the impact of one more unit of effort/time/resource? Diminishing returns: More isn't always better (looking at you, meeting schedulers)

These aren't abstract concepts. They're decision-making frameworks for humanizing business relationships.

The Uncomfortable Reality Check

If you're reading this and thinking, "But Seung, I need my people to hit their numbers, I can't just hold hands and sing Kumbaya"—you're right.

But you're also missing the point.

"Leaders have to produce. They have to perform," Seung acknowledges. "If you don't achieve certain milestones, you're probably not going to stay in that position very long."

The question isn't whether you need results. Of course you do.

The question is: How are you getting those results?

Are you getting compliance? Or are you getting commitment?

Are people doing the bare minimum? Or are they breaking through walls for you?

Are they updating their LinkedIn profiles behind your back? Or are they telling their friends they want to work for your company?

The Journey, Not the Destination (Sorry, Had to Go There)

Here's the hardest part to accept: there's no finish line.

You don't "complete" the journey to becoming a more relational leader. You don't check off ten boxes and suddenly you're done.

"Your heart is trying to get to the right place in this notion of humanizing the relationship between leader and follower," Seung says. "But your follow up question of what are the ten things I must do? You've just legalized yourself again. You've just transacted yourself."

This is company culture transformation strategies in its rawest form—understanding that culture isn't a program you implement. It's a way of being you embody.

Every. Single. Day.

The Bottom Line That's Actually About Humans

The companies crushing it with sustainable business expansion strategies right now? They're not the ones with the best org charts or the most sophisticated KPI dashboards.

They're the ones whose leaders understand that people aren't "labor inputs."

They're the ones who've figured out that you can't checklist your way to authentic connection.

They're the ones whose teams would break through walls for them—not because they're contractually obligated, but because they genuinely want to.

So here's my challenge: Next time you ask someone on your team "how was your weekend?"—actually stop and listen to the answer.

Don't look at your phone. Don't scan for the next person. Don't think about your next meeting.

Just listen.

And notice what happens when you actually see the human in front of you instead of the "labor input" on your org chart.

Want to watch the full conversation with Seung Paik? Check out Episode 141 of The Human Connection Podcast. He goes deep on the ten economic principles framework, the dangers of transactional relationships, and why the best leadership development might come from your Econ 101 textbook.

Because at the end of the day, no matter if your business is B2B or B2C, it's really H2H—human to human.

P.S. If you're thinking, "But Karl, I'm already doing the 1-on-1s, I'm already asking about their weekends, why isn't it working?"—here's your answer: They can tell you're going through the motions.

Your people are smarter than you think. They can feel the difference between genuine interest and checked-box compliance. They know when you're treating them like humans because some leadership consultant told you it would improve your retention metrics versus treating them like humans because you actually see them as humans.

The first is still transactional. The second is transformational.

And until you figure out the difference, you're going to keep losing your best people to leaders who actually give a shaet—not because it's good for business, but because it's the right thing to do.

Stop trying to optimize human connection. Just connect.

Karl Pontau hosts The Human Connection Podcast, where we talk about the stuff that actually matters in business: the humans running it. Because whether you're B2B or B2C, it's really H2H—human to human. Subscribe so you don't miss the next episode where we probably say something that'll make your HR department uncomfortable.