Monday, May 10, 2010

Tale of Two Assets

Think how much information there is in the company about it's building, transactions, pumps, patches of land or whatever else a company might own. Also, they claim that they "own" their employees as stated in the intellectual property clause of the contract. Fine, if you "own" someone, you should have an operating instruction, technical note or some other piece of paper you might consider sufficient to describe the human capital you have at your disposal. Hypocrisy of the situation is captured in the phrase I chose to put in the description of my blog, "If people are our greatest assets, why don't we put them on the balance sheet"?

This video gives a quite adequate representation of the situation most firms face nowadays. The industrialism is deeply ingrained in many managerial minds, still stuck in 1920s when anyone was replaceable and had a tag attached. Well, newsflash - if you want to consider someone "corporate property", there must be respective cashflows and trackable records of all aspects of the organizational life: inception and birth (i.e. attraction and recruitment), schooling (includes all training, most valuable - on the job, mentoring and coaching), maturation (delivery), recreation (what drives the employee apart from the insatiable desire to show up at the fluorescent office every day, what are the interests outside of the corporate routine?), personal finance (salary, bonuses, other elements of remuneration), intellectual growth (how much information does the employee get, how does s/he gets acknowledged, what are the change aspects in the job, challenges), and finally - self-actualization (what are the aspirations, how can the company get the employee to the maximum potential level in as little time as possible, what does the firm need to do to keep him or her happy as a clam?) Check out the short video about Sammy and Barry and try to answer a couple of questions below - this can be an exciting discussion!

  • why is it difficult to keep track of "human capital"? we seem not to have any issues with other organizational assets.
  • what is so special about the shift from industrial imperative to information age framework? how does that reflect on HR processes overall? how far are we on the journey? what are the greatest enablers and barriers?
  • what is the role of the employees in facilitating the shift to the new model?
Phew - I feel like a ferocious university professor, making poor students toil over a die hard case study. Relax! As one of our professors says, "Accounting is sexy, Accounting is fun." 

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