Increase the Worth of Human Capital, don’t stifle Human Resources
Human resource development and management does not develop human capital precisely to produce valuable results and increase in worth
There is a lot of talk and writing about human capital, intellectual capital, knowledge management, and other means to improve the capabilities, productivity, and output of human capital. Despite the talk and writing, companies have never been able to integrate business process capability requirements, human capital capability development, qualified human capability deployment, human performance and cost, the value created by human performance, the value-added by human capabilities, and the worth of specific human capital.
Many companies proclaim that their people are their most important asset. But most of the companies manage human resources as employees, rather than managing human capital as assets. Many common human resource structures actually stifle human capital with contrived organizations and positions, position or job descriptions, salary scales, and career plans.
We can manage human capital effectively by managing the utilization of all capital in business performance to produce business results
The fundamental problem of 20th century enterprise management used today is the failure to manage the business. The enterprise is managed through organization, planning, accounting, human resource management, performance management, and other structures laid over the business. The actual business is defined as “investments in capital as solutions of worth utilized for costs and effectiveness of performance to produce value and quality in results”. Investments in capital include human capital solutions in the personnel utilized, human capabilities developed, and human knowledge support developed.
All human capital solutions are utilized in business performance to produce specific business results. Human personnel solutions manage time utilization and monthly performance costs of all internal and external personnel utilized to produce results. Human capability solutions manage the amortization and utilization of developed human capabilities in performance to produce results. Human knowledge solutions manage the amortization and utilization of developed knowledge solutions to properly utilize specific capital solutions to properly produce specific results.
All human and other capital utilization and amortization costs are charged against the value of results to determine the result value created and the positive or negative result value-added over total costs. A portion of result value and value added is pro-rated to each solution utilized to manage the return on the solution investment in result value created to date, the gain or loss on the investment in result value-added to date, and the capital solution worth (now often called asset value) in the future result value creation and result value-added expected over the future useful life of the solution.
21st century business management develops needed capabilities to produce result value and increase human capital worth
21st century business management manages human capital to deploy human personnel solutions to be ready to be managed to produce results, human capability solutions where required by the business to produce a specific difficult result, and human knowledge solutions to develop human capabilities and to utilize specific solutions to produce specific results.
21st century business management enables the company to:
- Organize and manage the business in terms of specific results to produce and the specific human and other capital solutions required to produce the results
- Define human capability solution and knowledge solution requirements of the business to produce specific results of value
- Develop specific human capability and knowledge solutions for specific result needs
- Manage human personnel capital to be ready and utilized to produce results
- Deploy and manage qualified human capability capital, such as salesmanship, needed to produce specific results, such as order booked
- Create and deliver human knowledge solutions, such as customer information utilization or product sales knowledge, needed to increase human capital worth, to utilize specific capital solutions such as the customer information system, and to produce specific valuable results such as the product sold end-result in the order-booked result set.
- Manage human performance amortization and utilization costs against the result value produced
- Attribute result value and result value-added to date in the utilization of the solution to know the return and gain or loss on human remuneration costs, human capability development investments, and human knowledge development investments
- Evaluate result value produced and assess human performance to appraise future result value creation potential and related human capital worth
- Develop human capital and capabilities to produce higher-value results, to increase in worth, and to justify increased performance costs in personnel solution remuneration
Organizing and managing the business and the human capital role in the business, facilitates the development and management of natural human capital, and provides the structure for human capital to develop specific capabilities, perform, produce valuable results, and increase in worth.
Result-performance Management (R-pM) provides the knowledge for actual business management
Result-performance Management (R-pM) is the only source of knowledge and expertise on how to manage the actual business. Forward-looking enterprises are now using R-pM guidance to organize and manage their business to gain breakthrough advantages over competitors burdened by unsolvable 20th century management problems. Business management is explained and documented in the Business Management Toolkit. The Toolkit provides procedures for actual business management and maintains emerging 21st century management conventions, definitions, and standards. Management consultants who base 21st century business management services on R-pM knowledge are licensed to help enterprises learn, organize, and manage the actual business. Business management knowledge and the Business Management Toolkit are available and supported today at result-performance-management.com.
The Solution to the Economic Crisis is explained in free downloads
Three free white papers explain the dead-end 20th century management problems, such as the failure to plan, account for, and manage the actual business, that caused the economic crisis, the way to eliminate the problems, and a government program to address the crisis by stimulating the economy, solving the problems, building a structure for financial and economic management, and organizing local businesses to flourish in the eventual recovery.
- How to Eliminate Problems that caused the Economic Crisis explains the major unsolvable 20th century management problems and the solution to eliminate the problems
- Business management; the only Solution to the Economic Crisis explains how to plan and manage the business to capture business data and provide management the information needed for actual business, corporation, industry, and economic management
- A Government Business Management Program to Answer the Economic Crisis outlines a government program to encourage business management, stimulate the economy, restore confidence, organize businesses to flourish in the recovery, and manage economic cycles to prevent future crisis
These three white paper downloads are available to R-pM Community Members at result-performance-management.com. There is no cost or obligation to join the R-pM Community. Join by entering your email address and personal password. Your email address is protected and used only for download problems, product updates, and occasional R-pM Member news and white papers.
