At a recent HR management seminar, I sat through three presentations where I heard that tired old cliché - “our people are our greatest asset”. Now don’t get me wrong, I’m a big fan of talent management, and I’m sure each of the presenters actually believes people are their organizations biggest contributor. No, the problem I have isn’t with the earnestness of the presenters; it’s with their understanding of what really constitutes an asset and how it should be measured.
I’d argue that people shouldn’t even be classified as assets at all. Let’s face it, if you’re in the business of mining, the organizational asset is the ore that’s dug out of the ground, processed efficiently and then turned into the shiny stuff upon which the business turns a buck. If you’re in the high-tech business, the organizational asset might be the leading edge software that’s developed faster than the competition. These are the assets that deliver returns to shareholders, are measured by financial analysts, and ultimately determine success.
If HR managers continue to believe people are actual ‘assets’, then they should be able to answer some fundamental ‘asset’ type questions:
How many have you got? Sound’s easy huh, but how many people assets do you actually have in your organization at any point in time, and what’s the breakdown by division, role, gender, age range. I’m always amazed that organizations can count the number of PCs and even the number of software licenses with absolute accuracy, but can’t apply the same rigor to counting and classifying staff.
What’s the current book value? Ok, so perhaps you can reliably say you have 2,319 people in your organization. But what’s their value in terms of supporting the delivery of the types of real business assets discussed above. If you can’t reliably measure the contribution of your people in supporting business goals, then you may as well be in the sheep herding business.
Where are your risks? If people are your greatest asset, then you know with surety who you need to keep motivated, right? Again it sounds like common sense, but many organizations can’t determine high performers; relying too much of point-in-time performance assessments or failing to track achievements and experience on an ongoing basis.
So next time you’re about to utter the ultimate HR cliché STOP and THINK. Understand what the true business asset actually is, how people contribute towards increasing the value of that asset, and where your talent risks and exposures are. Remember ‘youcan’t manage what you can’t measure’ – and yes I’m sorry, that’s another management cliché.
Zapeteo
Living in a land far-far-away, Zapeteo writes about anything and everything related to the management and mentoring of really talented people. As such, he frowns on wooden phrases like ‘human capital management’ and ‘performance-based culture’. Instead preferring to discuss real issues, involving real people and especially what can help them build fruitful and rewarding careers.
The Ultimate HR Cliché
0At a recent HR management seminar, I sat through three presentations where I heard that tired old cliché - “our people are our greatest asset”. Now don’t get me wrong, I’m a big fan of talent management, and I’m sure each of the presenters actually believes people are their organizations biggest contributor. No, the problem I have isn’t with the earnestness of the presenters; it’s with their understanding of what really constitutes an asset and how it should be measured.
I’d argue that people shouldn’t even be classified as assets at all. Let’s face it, if you’re in the business of mining, the organizational asset is the ore that’s dug out of the ground, processed efficiently and then turned into the shiny stuff upon which the business turns a buck. If you’re in the high-tech business, the organizational asset might be the leading edge software that’s developed faster than the competition. These are the assets that deliver returns to shareholders, are measured by financial analysts, and ultimately determine success.
If HR managers continue to believe people are actual ‘assets’, then they should be able to answer some fundamental ‘asset’ type questions:
How many have you got? Sound’s easy huh, but how many people assets do you actually have in your organization at any point in time, and what’s the breakdown by division, role, gender, age range. I’m always amazed that organizations can count the number of PCs and even the number of software licenses with absolute accuracy, but can’t apply the same rigor to counting and classifying staff.
What’s the current book value? Ok, so perhaps you can reliably say you have 2,319 people in your organization. But what’s their value in terms of supporting the delivery of the types of real business assets discussed above. If you can’t reliably measure the contribution of your people in supporting business goals, then you may as well be in the sheep herding business.
Where are your risks? If people are your greatest asset, then you know with surety who you need to keep motivated, right? Again it sounds like common sense, but many organizations can’t determine high performers; relying too much of point-in-time performance assessments or failing to track achievements and experience on an ongoing basis.
So next time you’re about to utter the ultimate HR cliché STOP and THINK. Understand what the true business asset actually is, how people contribute towards increasing the value of that asset, and where your talent risks and exposures are. Remember ‘you can’t manage what you can’t measure’ – and yes I’m sorry, that’s another management cliché.
Zapeteo
Living in a land far-far-away, Zapeteo writes about anything and everything related to the management and mentoring of really talented people. As such, he frowns on wooden phrases like ‘human capital management’ and ‘performance-based culture’. Instead preferring to discuss real issues, involving real people and especially what can help them build fruitful and rewarding careers.