Investing in human capital, people assets
Published February 9, 2007
Today's competitive global market environment brings steadily increasing pressure to improve return on investment (ROI). In the push for improvement, an organization’s biggest investment and its primary assets are its human capital.
Asset management
Many companies are focused on management of capital assets – maximizing utilization and minimizing downtime with a minimum of upkeep and maintenance.
Return on capital assets is constantly being measured with break-even calculations and strictly financial returns – all typical “bean-counting” myopia. Indeed there are several technology solutions that are being offered to address these kinds of plant and equipment problems – on-line monitoring, machine-to-machine (M2M) communications and the like. Operating ROI is constantly monitored and can be made available at any time.
But there are no real measurements to monitor and maximize company’s biggest assets – people. In most companies this is the realm of “human resources”, often reporting at a non-executive level to a financial manager and mostly related to payroll, vacations, insurance, legal regulations and discipline. Even in large corporations, the Human Resource (HR) Manager is often ranked lower than other executives.
*Peter Drucker’s* advice
More than 50 years ago, the famed management guru Peter Drucker was the first to assert that workers should be treated as assets, not as liabilities to be minimized or eliminated. He originated the view of the corporation as a human community built on trust and respect for workers, and not just a profit-making machine.
Peter Drucker wrote continuously on a variety of issues. His books launched the "practice of management" as we know it today. In his later years his comprehensive articles covered an amazingly wide spectrum of human affairs.
The great management guru died in November 2005, at the age of 95, eight days short...