Employees - The most precious resource

Financial capital is considered the most critical aspect of any company. Top-level executives keep discussing how to increase capital and draw maximum profitability. However, financial capital is not the company’s most scarce resource. In fact, it is relatively easily available and still cheap. As per Bain’s Macro Trends Group, global supply of capital stands at around 10 times global GDP. Hence, the demand for investment in projects and R&D is considerably low than the most scare resource -- human capital.

Yes, you read it right. Human capital measured by time, skill (talent) and energy of the workforce is the most important resource of an organisation, which is never valued its actual worth.

The time of an employee is counted by hours or days of employee’s career, which is limited. Even the skill or talent he possesses is scarce. And lastly, energy too is hard to retain. Though the last two qualities are intangible they could be easily measured by the number of satisfied employees in the organisation. A study reveals that satisfied employees are almost three times more productive than dissatisfied one. Talking about modern human capital, Richard Lobo - executive vice-president and HR head, Infosys says, “The workforce of today is diverse, spanning multiple generations, geographies and time zones. This brings with it numerous opportunities and challenges as well. Rigid systems and processes, hierarchical structures, inflexible policies and linear modes of thinking are slowly being phased out to welcome flat organisations, space for innovation, and a focus on collaboration through creative thinking.”

However, executives hardly devote time to manage it. The workforce is the last thing taken care of. Contrary, every parameter of career’s excellence revolve around finances. People engaged in handling manpower aren’t recognised for their efforts while those who talk and work for managing and allocating funds are always in demand.

Ways to improve human capital

Measuring: There are various ways to measure financial capital but measuring human capital is a bit tricky. However, we do have ways to measure it which also forms the basis of one’s growth and development in the organisation. Deploying productive power index can effectively measure the cost incurred by the organisation and return received against it through effective talent and energy use of the employee.

Investing human capital: Just as we invest in financial capital, we need to think on similar lines for human capital too. For this, we need to think about the opportunity cost for a lost hour. If we start measuring the cost of meetings by adding the number of hours consumed by meeting, we can calculate the cost of lost hours since there is no work happening. The lost hours are the loss of productive hours too. Thus, we need to properly determine the need and benefits of any meeting before conducting it.

Monitoring: As financial capital is measured by comparing actual and expected results, human capital should also be measured through periodic reviews. This is done by comparing how much time is invested and how effectively we can use the organisational time to achieve results. In case of skills or talents, management should check if the right candidate is deployed at the right place.

Recognition and rewards: Employees who perform exceptionally well deserve appreciation. Thus they should be recognised and rewarded for their efforts which further boost their motivation to stay loyal to the company and work harder. Retaining a motivated employee is much easier than retaining a de-motivated employee.

Suggesting ideas on ways to improve Human Capital, Richard Lobo says, “As organisations hire more millennials, it is up to the organisation and its leadership to truly utilise the best qualities of this generation for growth. In the process, they will help the organisation succeed too. At Infosys, we have multiple trainings and programmes that help employees realise their potential and explore their interests in domains and technologies, along with soft skills. We also place the employee’s career in their hands through the Compass platform that empowers them with enough information to make informed decisions about their next move within the company. We also apply Data Analytics to the life cycle of our employees to identify those talents that require extra retention focus. Finally, we focus strongly on innovation within the company and it is a part of our culture, therefore, we enable each employee to be an innovator too.”

Suvamoy Roy Choudhury, director - HR, Vodafone India, says, “At Vodafone, we accelerate careers for our top talent through segmented leadership programs designed for various stages of an employee’s lifecycle. We have curriculum led signature interventions for senior managers, women leaders, technology managers, young managers – each intervention typically spanning over 12 to 18 months. We partner with best in class partners to deliver impactful learning experience through these carefully curated programmes.”

These basic and simple ways can bring a drastic change in any company’s growth trajectory. It’s time that we start valuing human capital as much as financial capital so we can overcome the problem of human capital scarcity.

REACHING FULL POTENTIAL

• Deploying productive power index can effectively measure the costs and return through effective talent and energy use of the employee
   
• As financial capital is measured by comparing actual and expected results, human capital should also be measured through periodic reviews

The writer is executive coach & owner of www.thechrysallis.com