Workforce Planning...Human Capital Asset Wake-up Calls
- Written by Gary Watkins
- Published in Articles
Workforce Planning...Human Capital Asset Wake-up Calls
Carol o'Brien...Editor
The 2015 Reports on human capital by the World Economic Forum [WEF] and Deloitte are wake-up calls to effectively invest in and leverage human capital by confronting people management practices.
WorkInfo has, in a multitude of past and recent articles, addressed the fact that human capital is an organisation's greatest resource, and the critical aspects of effectively managing human resources [HR]. Topics have ranged from human capital management trends, the future and HR priorities in the new economy, and the linking of the management of human capital to business value.
The 2015 WEF and Deloitte Reports highlight the correlation between managing human capital and business value - particularly in the context of the new economy. An International Monetary Fund publication in early 2000 referred to the characteristics of the new economy being 'a higher rate of productivity growth related to investment in IT' [information technology]. While the 'new economy' is often referred to as the knowledge or information economy, the focus on HR dates back to way before 2000.
In the early 1990s Bloomberg BusinessWeek stated that 'knowledge only flows through the technology; it actually resides in people...and the organizations they inhabit'. A meaningful analogy in that article is that in the old economy labour was a commodity whereas in the new economy 'what counts is a company's ability to attract, retain, and continually grow the capabilities' of people.
Business values describes the behaviour of an organisation - in other words how it governs itself. It's evident from the recent Reports that South Africa has been slow in responding to wake-up calls as far back as 2009. One such call was the South African Board for People Practices' [SABPP] opinion paper on the HR implications of King III. A recent WorkInfo article on Governance and Human Resources referred to the interview on Morning Live in April 2015 with Marius Meyer CEO of SABPP and his reference to the need for an 'integrated, aligned and well governed approach'.
A subsequent opinion paper published in 2011 in the SA Journal of Human Resource Management titled Human resources risk management: Governing people risks for improved performance [Meyer M, Roodt G, & Robbins M], referred to the Human Resource Research Initiative of SABPP. That opinion paper included excerpts from Brian Joffe's books on the Bidvest story. Joffe, Chief Executive of the Bidvest Group, reasons that 'we live in a country with a dearth of skills' and by giving 'people the right opportunity, the right tools and training, and they will perform'.
While recent reports by economists are sometimes at odds about a looming recession in South Africa, the Nielsen's Consumer Confidence Index Report for the second quarter of 2015 revealed that opinions rose by 3%, and that 73% of the respondents believe the country is in an economic slump. The sentiments about the perceived downturn in our economy, and the 2015 Reports on human capital by WEF and Deloitte are a wake-up call for leveraging the important asset of human capital.
The WEF 2015 Report's Human Capital Index covers 124 countries and evaluates education, skills, and employment levels. The overall ranking of South Africa is 92. While the ranking of high-skilled occupations' workforce is 48 we should be very concerned about our rankings of 105 in medium-skilled employment, the business executives' perceptions ranking of 114 for finding skilled employees, and the low ranking of 111 for economic participation by the age group of 65 and over. The latter measurement included an 'individual's potential to remain active and productive into older age'.
The Deloitte 2015 Human Capital Trends Report which focuses on leading-engaging-reinventing-reimagining, was informed by a survey that the revealed an increase in the capability gap for nearly every HR talent. The Deloitte 2015 Report stresses the urgent need to address 'growth, volatility, change, and disruptive technology' by embracing a simplified approach to managing HR and focusing on engagement.
There is no time for complacency. The WEF and Deloitte 2015 reports on human capital magnify the critical need to respond to historical and more recent wake-up calls.
A GALLUP 2013 worldwide survey revealed that 63% of employees are not 'engaged' and that 24% are actively disengaged' - respective indications that employees are less likely to contribute to achieving organisational goals, and that they are unproductive and likely to spread negativity. Since 2007 GALLUP has recognised organisations worldwide that engage employees across teams, departments and locations. The criteria included demonstrating clear links between engagement and business outcomes.
How can an organisation address engagement? Mentoring or coaching can bridge the gaps
- coaching is frequently referred to in the Deloitte 2015 Report. A 2011 article in Forbes Infosys on business leadership for smarter organisations indicates that coaching and mentoring differ - coaching must be defined by what is needed and training should form part of a coaching initiative. A WorkInfo article describes mentoring as a way to transfer learning and accelerate empowerment, and as a relationship between a more experienced, seasoned, and wiser person and a less experienced person.
- coaching is frequently referred to in the Deloitte 2015 Report. A 2011 article in Forbes Infosys on business leadership for smarter organisations indicates that coaching and mentoring differ - coaching must be defined by what is needed and training should form part of a coaching initiative. A WorkInfo article describes mentoring as a way to transfer learning and accelerate empowerment, and as a relationship between a more experienced, seasoned, and wiser person and a less experienced person.
There is a correlation between the WEF's rankings of 114 for finding skilled employees and the low ranking of 111 for economic participation by the age group of 65 and over, the Deloitte call to simplify the management of HR, and coaching/mentoring needs. Mentors/coaches can be contracted on a contingency basis while Chief Executive Officers simultaneously focus on the business values 'big picture'. A good source for reviewing how to address the latter is the WEF's supporting portal on Disrupting Unemployment which consolidates information on business-led partnerships for addressing skills gaps over the next five years.
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Last modified onMonday, 02 November 2015 23:51
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Gary Watkins
Gary Watkins
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BA LLB
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