Archive for the 'Human Capital Management' forum

In most enterprises, human resources are administered as employees and are assigned to positions in organization units. There is no way to measure the value they produce, evaluate performance costs against the value created, assess their worth as human capital, or to develop them to increase their worth and provide measured increased value to the enterprise. Administered employees do not have a defined stake in the enterprise.

Conventional human resource management methods prevent good human capital management

There is a lot of talk about human capital, intellectual capital, knowledge management and other means to improve the capabilities, productivity, and output of human capital. But, each item is treated separately. We try to manage human performance, but have no framework to understand real human performance related to measured value to the business. We try to develop human capabilities, but have no framework to relate human capabilities to specific business needs. We have no way to integrate human capital performance with the value created and the worth of human capital.

We try to manage and improve human performance without managing the results humans produce

The key to making human capital a high-worth asset is to manage the results our enterprise produces related to human and other capital utilized.

We need to document the human capabilities required by our business processes to produce specific results. [more...]

20^th century management administers the human resource function

Today’s 20^th century management generally administers human resources as employees. Human capital management is talked about, but is not truly understood and is rarely put into practice. Since the business is not managed, human capital can not be managed as a part of the business. Humans tend to be assigned to a responsibility center to be managed by a specific manager, with human utilization and development depending on the outlook of the manager.

Human and knowledge development tend to be directed at the general needs of the enterprise, rather than the specific needs of the business. Humans are not developed and utilized as enterprise capital to create the highest value and to increase human capital worth.

R-pM manages human capital worth to produce result value-added for 21^st Century Management

Result-performance Management (R-pM) organizes the business for 21^st Century Management. R-pM follows 21st Century Management conventions, definitions, and standards to enable business collaboration and integration, common solutions and outsourcing, and an environment for human capital development that can be applied to any business. R-pM includes fundamental principles to improve the worth of human capital and the value-added to business results:

• Enterprise capital is organized by the human capabilities required to manage, develop, and support the capital
• Enterprise result sets are organized to utilize a common set of performance solutions, particularly human capability and outlook
• Human capital is organized as one category to be managed by those with human management and development capabilities
• Human personnel is readiness capital to maintain human capital ready to produce a set of results under a result management responsibility
• Human capability is production capital to define the capabilities needed by the business process for difficult high-value results to acquire or develop specific capabilities needed by the business
• Human knowledge is information capital to create and manage the knowledge to develop capabilities, and to utilize specific performance solutions to produce specific results
• Human capital worth is increased by additional capabilities developed and knowledge established through knowledge creation to produce results
• Human capital worth is assessed against the known result value-added produced and other factors to ensure that human remuneration is in line with the value created in the business

Human capital is the most difficult to acquire, develop, and manage in any business. R-pM places human capital where they have the interest, outlook, and capability to produce specific results and develops capabilities where humans have the interest, innate foundation, and prior experience.< [more...].

Our personal business is the way that we organize and manage our daily life

Each of us has our own personal business that must be organized and managed just to get things done in our daily life.

We organize our personal business naturally

We have things to accomplish, whether it is a prepared breakfast, arrived at work, entries in a “to do” list, items purchased, or going out for a good time. Each thing we accomplish is a result. We do not consciously think of them as results, we just accomplish them naturally. The results we produce are distinct outputs or accomplishments that can be described and counted.

In order to produce results, we naturally utilize our capability, knowledge, reusable equipment, a process, consumable supplies, tactics, etc. The things we use in performance are our personal capital, such as our residence, our belongings, our car, our money, and our own time. We use capital as the appropriate performance solution to produce the result, such as a capability we have, a tool or equipment, a recipe, specific supply items, etc. We organize these performance solutions in our residence so that we know where solutions are, when we need to produce a result. We all organize our business results and performance solutions in the same way, because it is the natural way to organize.< [more...].

Administration is one of the top ten problems of 20^th century management

20^th century management includes wasteful and counterproductive administrative functions

20^th century administration performs a function involving fixed routine tasks. Responsibility is for the function or the process of administering, rather than producing results. Administration is responsible for managing enterprise capital, but few administrators recognize this responsibility, in effect preventing proper capital management. Much capital is assigned to centers or labeled as “intangible assets”, removing it from professional management. Other capital is loosely administered through functions, instead of being specifically managed to produce benefit and achieve a return on the enterprise investment. The emphasis is on administrative performance rather than capital result management.

R-pM converts administration to professional capital management

Result-performance Management (R-pM) organizes all enterprise capital for professional 21^st century management for operation, support, development, and utilization to produce results. R-pM replaces administration with capital management. Capital managers must produce capital management results to develop, maintain, and improve the worth of capital to provide specific solutions. Performance management, within capital management, deploys and maintains solutions to produce revenue, capital, and investment results.< [more...]

Most of us think of human capital as human resources or the people that are employed in the business. This is one part of human capital. Human capital includes people as human personnel capital.

Human capital also includes the capital that improves innate human performance. This capital includes human capabilities as a separate set that can be developed and managed to produce results. This capital also included human knowledge as a separate set that can be created and delivered to assist humans utilize other performance solutions and produce higher-value results. Human capital is logically defined as “the personnel, capability, and knowledge capital that is mobilized through performance solutions to execute enterprise operations and produce results”.

Logically all capital must be defined as performance solutions to be deployed and utilized to produce a specific result. The post on August 6, 2007, The Logic of Capital Management, provides the background.

Capital utilized by the business is organized into four categories

Capital utilized by the business requires different professional capabilities to be professionally managed, which organizes four categories of capital:

• Business organization, process, and data capital to manage capital that directly produces a result and cannot, generally, produce another result. [more...]

Human Resource Managers are important capital managers

Are you a human resource manager? How do you approach your work? As a routine administration function? As responsibility for the enterprise human capital to ensure that human capital maintained ready to perform, is developed to acquire new capabilities to increase human worth, and provided with knowledge needed to provide value to the business?

If your answer is closer to the latter, you will clearly benefit from R-pM. The impact of R-pM on human resource management is explained in the Human Capital Management Forum, and in human capital articles, such as “Integrate Human Capability Capital with the Business” in 21^st Century Management Magazine. R-pM goes beyond 20^th century human resource administration to provide professional 21^st Century Human Capital Management.

Result-performance Management (R-pM) organizes the business for 21^st Century Management

The means to understand the actual business and the human capital that you support is through Result-performance Management (R-pM). The enterprise business and your business is defined by only two entities:

• Results: The economic outputs that create the value from the business
• Performance Solutions: The human and other capital consumed in performance to generate the costs incurred by the business to produce result value

Even as human capital manager, you manage only these two entities in your business, as a sub-set of the enterprise business. [more...].

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 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. Many common human resource structures actually stifle human capital with contrived organizations and positions, position or job descriptions, salary scales, and career plans.

Result-performance Management (R-PM) develops needed capabilities to produce result value and increase human capital worth

Result-performance Management (R-pM) 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 result, and human knowledge solutions to develop human capabilities and to utilize specific solutions to produce specific results. [more...]s.

In an article on 28 February 2006, we asked, Why do we have such a problem relating knowledge to our business needs?, We said that enterprises need a systematic way to define the precise knowledge needed, to relate knowledge to the capability of the user applying the knowledge, to link knowledge to where and by whom it is needed, to understand the value provided by knowledge, and to get feedback and improvement on the knowledge.

We need to manage knowledge as human capital to enable human capital utilize specific performance solutions to produce specific results

Knowledge is human capital that must be created and managed specifically to increase human capital worth through developed human capabilities and the value of results produced by human personnel and capabilities. Knowledge is also information capital that must be integrated with business data and delivered where needed to produce specific results and to support human capabilities utilized. Conventional methods hamper the application of knowledge by defining the business through various contrived entities like department, activity, and object, while organizing knowledge by topic, subject, etc. The business must be organized by specific performance solutions utilized and specific results produced, and then knowledge needs developed as performance solutions and be organized by results and other performance solutions utilized to be applied to an organized business.
The means to create, manage, integrate, and deliver knowledge is provided by Result-performance Management (R-pM). Result-performance-management.com shows how to manage knowledge as human and information capital.

Result-performance Management (R-pM) provides the means to manage knowledge for results

The article pointed out many problems with the conventional methods that we use to manage knowledge: [more...]

Human resource development management often does not improve human capital to produce corporate results

In January 2006, we posted an article “Stop Stifling your Human Capital with Human Resource Administration“, which we elaborate on here.

Many companies proclaim that their people are their most important asset. But most of the companies administer human resources as employees, rather than managing human capital. Many common human resource methods actually stifle human capital by putting people where they cannot escape. Such devices as organization functions, organization positions, position or job descriptions, salary scales, career plans, and organizational assignments tend to fix people in inflexible boxes.

Result-performance Management (R-pM) enables the company to manage human personnel capital to be ready to produce results, human capability capital needed to produce specific results, and human knowledge capital needed to increase human capital worth and produce valuable results. Join the R-pM community to learn to manage human capital to increase human worth and create company result value.

Human resource administration and development should be converted to human capital management

Human resource management systems and software and administration methods manage human capital as employees. But, people or human capital are assets that should be utilized to provide the best value to the enterprise, should have some say in how they can increase their value to the enterprise, and should be rewarded commensurate with the value they provide. [more...].

The Human Performance Problem

Management and staff within the enterprise know that they must improve to keep up with the competition and increasing customer demands. But, these same people resist change unless they fully understand the change and are comfortable with it. People get comfortable performing routine functions in a stable organization. Often, they are told what to do and do not think for themselves. Enterprises are concerned about controlling people to ensure that nothing is done wrong, which hampers eventual change.

Second and third level management normally have been around for a long time and gain advantage from the existing situation. Perhaps they were involved in establishing the current methods. They require particular attention in a business change. Often people are pushed into new situations without the preparation and on-going support needed. This generates additional resistance and often results in the failure of the business change.< [more...].