HR Planning

Valuing Human Capital the Easy Way

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It is not that difficult. Knowing how, when, what, and why an organization should engage in the financial valuation of resources is something that all companies should understand.  It seems, however, to be something that many organizations forget about when considering their most expensive asset, human capital.

A humorous explanation about the valuation process linked to measuring human capital is shown in the following video clip.

Source: PeopleStreme.  The above content constitutes a link to the source website.  Please click the play icon to stream the video.

From this perspective, we can see how much is invested when following the progress, appreciation, and depreciation of company equipment and materials.   There are numerous actuarial tables and formulas that can be used to evaluate the contributions of hard ‘things’ to the overall financial health of an organization.  Keeping track of Barry the boardroom chair is easy!  Keeping track of what Sammy brings to the boardroom table seems much more complicated!

Why is it so difficult to provide similar value based financial assessments for employees?  When organizations tell their people that they are valued, what is the actual measure of that statement?

As Sammy finds outs in this video clip, the results can be quite shocking when we look at the return on investment that companies make on an individual employee basis.  Perhaps it is time to be as open and transparent with all employees to let them know how valuable they really are as they continue to contribute to the bottom-line financial success of any organization.

This clip ends with a pretty simple message that is, in itself, quite valuable.  Find your people.  Know your people.  Manage your people.  The return on investment will definitely pay off.

Discussion Questions:

  1. Think about your own work experience over the past five years. How much did the company you worked for, pay you?   How much value did you contribute back to the company?  What is the differential?
  2. Upon leaving your current place of employment, do you see yourself as an appreciating or depreciating asset from a pure, return-on-investment perspective?
  3. What types of measures and tools can the Human Resources practitioner put into place in order to value the true cost of employees as part of the Human Capital investment strategy?

Succession Management: Why and How?

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Succession Management is one area of Strategic Human Resources Planning that is getting a lot of ‘air time’.

Various images of crowns
Source: Mischoko/Shutterstock

In our HR planning studies, we have learned that the focus for future organizational success is critical and dependent on ensuring that the right people are available to step into the right roles at the right time and in the right place. As HR Professionals, this task is left to us!

Luckily, we are able to call upon the experiences of seasoned HR experts for some advice on succession management strategies and risks.

Click Here to Watch a Video.

As noted by members of this expert panel, succession management does not have to be overly complex and difficult.  It begins by ensuring that individuals in organizations know that movement through the workforce structure is possible which means building a ‘mobility mindset’. However, this proves difficult when organizations make promises and set up expectations that they can not deliver; especially to those who have been identified as high performers or exceptional leaders.

Most importantly, it is clear that succession management needs to be managed in order for it to be successful.  This is definitely within the purview of the organization’s HR team and comes with great responsibility and accountability directly linked to organizational success.

Shakespeare wrote, “Heavy lies the head that wears the crown.” (Henry IV, Part 2, Act III, Scene1). When considering our role in succession planning, it seems evident that the Human Resources head may lie heavier still when having to plan who gets to wear that crown.

Discussion Questions:

  1. What are the benefits and risks of developing lists of high performing talent?
  2. Why is recognition of high performing talent so important?
  3. As an HR professional, how would you advise an employee who is no longer on a high performance succession planning list?
  4. Do you think it is important to be transparent when identifying employees who are high performers and potential leaders in an organization?  Why or why not?

Millennial Movement

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If there is one consistent thing when looking at workforce patterns, it is that the millennial generation is on the move.  However, how that movement is perceived seems to be a bit of a glass-half-full/glass-half-empty view.

GIF with caption, " I don't want to freak you out, but I may be the voice of my generation".
Source: alastairadversaria.wordpress.com. The above content constitutes a link to the source website.

A recent article in the Huffington Post provides us with survey-based information related to the high patterns of millennial workers wanting to quit their jobs.

Click Here to Read the Article.

The Canadian HR Reporter also posted an article recently that looks at the rationale behind the high rates of workforce movement for the millennial crowd.

Click Here to Read the Article.

As HR practitioners, we have a choice as to how we capture the challenges and opportunities offered by these millennial created patterns. The known benefits of a staid and stable post-millennial workforce may be just that, offering a steady flow that is predictable, unchanging, and perhaps, a bit dull.  It should be no surprise that the millennial workforce is vibrant and full of movement. This is a generation that is young, well-educated, and connected to the virtual world in a way that has never been seen before.  It certainly seems that the decision to move to the next best thing, for a person of the millennial generation, comes at a faster rate when existing things like career limitations or organizational values based fit are no longer comfortable.

Should we hold this generation back or let them go, knowing that this millennial pattern too, shall change?

Discussion Questions:

  1. As an HR professional, how does the statistical information about millennial workforce patterns assist in HR forecasting?
  2. If the patterns for millennial workforce movement are accurate, then a) What types of HR activities would be least effective for retention purposes? and b) What types of HR programs would be most important and effective to have in place?
  3. How does the survey information, including the identification of age/generational categories, reflect your own career experience or expectations?

Sleep time. Dream time.

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Her message is simple and powerful – Get some sleep.

Click Here to Watch a Video

After viewing this clip, you may be thinking, “What has this got to do with HR professionals and strategic planning?”  The answer lies in the power of giving organizations time for dreaming.  Especially when those organizations invest in the creative processes of shaping their own mission and vision.  Strategic planning should not be the production of a management checklist.  Rather, it should arise from the power of creative thinking.

When are our thoughts the most creative?  When we are given time to rest and to dream.

As Ms. Huffington states, we are in a society that seems to value the sleep-deprived state of one-upmanship.  Organizations, reflective of this society, seem to be caught up in the busy-ness of the business.  How much time is spent resting instead of doing, in order to allow for big picture thinking, planning and looking out for the future?  There seems to be far too much emphasis on a frenetic goal oriented checklist that narrows our work-life focus into the minutia and drains us of organizational life.  Getting ‘stuff’ done becomes critical so that we can prove our busy-ness worth in comparison to each other.

What gets lost in all of this frantic detail driven activity?  The ability to see and create mission, vision, and values, which come from, and enable, big picture clarity.

Organizations are living creations, made up of valuable human energy that ebbs and flows in natural rhythms.  All living things need to rest so that they can be re-filled and re-charged in order to meet new challenges in positive ways.   At the very least, let’s give ourselves a break and start building in some ‘organizational dream time’ on that checklist.

Maybe, we should sleep on it first.

Discussion Questions:

  1. How much time in your workday is devoted to thinking and not doing?
  2. When you are tired, how would you rate your ability to be creative?
  3. When are you most creative and productive within your workday?
  4. What is the value in being sleep deprived?

Good News, Bad News

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Reading Between the Lines

In 2014, Tim Horton’s was acquired by 3G Capital Partners LP.  Since then, it seems that the acquisition is destined for success as the parent company (3G Capital) and its shareholders are reaping profitable rewards.   These profits did not come from an unplanned, accidental approach.  Instead, there have been and will continue to be, specific and tangible HR business strategies implemented as the company continues through the transition phase of the acquisition process.

Two intertwined arrows graphic
Source: maxuser/Shutterstock

Click Here to Read the Article 

Where do the profits come from?  The article speaks to the streamlining of services, cost efficiency and a new zero based approach to budgeting.  What does this mean?  Job loss, restructuring, outsourcing, downsizing, changes to infrastructure, and culture shift.  The acquisition and merger of Tim Horton’s into an international parent company provides us with evidence of what the theory looks like in actual practice.  Each of these elements has been part of the theoretical Strategic HR Planning discussions that have been included in course of study.

The ‘real life’ end result provides for a good news story about a successful acquisition and merger based on a profitable reward.  What is not included in the story, so far, is the reality of this profitable success and its impact on the hundreds of employees who have lost their jobs.

This too should be included in the tangible HR business strategy, as this particular story continues to unfold.

 Discussion Questions:

  1. Identify three HR business strategies that, when implemented, will result in increased efficiency for 3G Capital Partners LP.
  2. What are the back office functions that could and should be outsourced when two companies merge?
  3. What types of HR programs would help employees as they move through the transition phase of an acquisition or merger?
  4. In your opinion, is this a good news story? Why or why not?