Intro to human capital management


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Intro to human capital management

  1. 1. Human Capital Management Vital and Tactical Planning 2008 © HireSmart All Rights Reserved .
  2. 2. Human Capital Management and Development This document contains copyrighted and proprietary trade secret information developed by HireSmart. In viewing this training document, you agree that the information contained will not be disclosed to any third parties. The human capital strategies, methods and tools described and explained in this training document represent potential competitive advantages to be enjoyed by HireSmart clients. Releasing this training content to any other parties without written permission from HireSmart is expressly prohibited, as it could easily diminish the competitive advantages to be enjoyed by HireSmart clients. 2008 © HireSmart All Rights Reserved .
  3. 3. Agenda – Day 1 <ul><li>Introduction to Human Capital Management </li></ul><ul><li>Human Capital Measurement </li></ul><ul><li>Human Capital Strategic Plans </li></ul><ul><li>Recruitment Strategy </li></ul><ul><li>Best Practices in Hiring </li></ul><ul><li>Performance Management </li></ul>2008 © HireSmart All Rights Reserved.
  4. 4. Agenda – Day 2 <ul><li>Introduction to Human Capital Development </li></ul><ul><li>Human Asset Profiles </li></ul><ul><li>Career Development Plans </li></ul><ul><li>Coaching, Training and Mentoring Programs </li></ul><ul><li>Emerging Management Roles </li></ul><ul><li>Closing Comments, Discussion, Next Steps </li></ul>2008 © HireSmart All Rights Reserved.
  5. 5. Introduction to Human Capital Management <ul><li>The only vital value any enterprise has is the experience, skills, innovativeness and insights of its people. </li></ul><ul><li>The success of any company will depend on its ability to understand how human capital links to its performance and its wealth. </li></ul><ul><li>The most competitive companies will have the best strategies and methods for attracting, hiring, managing, developing and retaining top performing talent. </li></ul><ul><li>Managers need training on how to apply human capital management (HCM) principles and methods to business strategy and performance.  </li></ul><ul><li>Today, we are going to learn about several new management tools and how others are using them to reach their business goals. </li></ul>2008 © HireSmart All Rights Reserved.
  6. 6. Major Contributions to Human Capital Management <ul><li>1986 – The Know-How Company – Karl Erik Sveiby </li></ul><ul><li>1997 – The New Wealth of Organizations – Thomas Stewart </li></ul><ul><li>2000 – The ROI of Human Capital – JacFitz-Enz </li></ul><ul><li>2001 – The Human Value of the Enterprise – Andrew Mayo </li></ul><ul><li>2002 – Corporate Longitude – Leif Edvinsson </li></ul>2008 © HireSmart All Rights Reserved.
  7. 7. The History of Human Capital Management <ul><li>1986- Sveiby publishes &quot; The Know-How Company &quot; on managing intangible assets </li></ul><ul><li>1987- Amidon publishes “Managing the Knowledge Asset into the Twenty-First Century” </li></ul><ul><li>1988- Sveiby publishes &quot; The New Annual Report &quot; introducing &quot;knowledge capital&quot; </li></ul><ul><li>1989- Sveiby publishes &quot; The Invisible Balance Sheet &quot; </li></ul><ul><li>1989- Handy publishes “The Age of Paradox” </li></ul><ul><li>1990- Sveiby publishes &quot; Knowledge Management &quot; </li></ul><ul><li>1991- Stewart publishes first &quot;Brainpower&quot; article in Fortune </li></ul><ul><li>1991- Skandia appoints Leif Edvinsson as the world’s first Director of Intellectual Capital </li></ul><ul><li>1992- Stewart publishes second &quot;Brainpower&quot; article in Fortune </li></ul><ul><li>1993- St. Onge establishes concept of Customer Capital </li></ul><ul><li>1994- Stewart authors &quot; Intellectual Capital &quot; cover article in Fortune </li></ul><ul><li>1994- Mill Valley Group decides to host a gathering of IC managers </li></ul><ul><li>1996- SEC symposium on measuring intellectual / intangible assets </li></ul><ul><li>1996- Sullivan and Parr book, &quot;Licensing Strategies&quot;, published </li></ul><ul><li>1996- Lev founds Intangibles Research at New York University </li></ul><ul><li>1997- Sveiby publishes &quot; The New Organizational Wealth &quot; </li></ul><ul><li>1997- Edvinsson and Malone publish a book, &quot;Intellectual Capital” </li></ul><ul><li>1997- Stewart book, &quot;Intellectual Capital“ is published </li></ul><ul><li>1997- Hoover Institution conference on measuring intellectual capital </li></ul><ul><li>1998- Sullivan book, &quot;Profiting from Intellectual Capital&quot;, published </li></ul>2008 © HireSmart All Rights Reserved.
  8. 8. Principles of Human Capital Management <ul><li>Building a powerful human capital strategy requires solid facts, measures, and processes for discerning where the firm will get the most leverage from its people. </li></ul><ul><li>Recent technological advances have been the catalysts for the emergence of new approaches to human capital management. </li></ul><ul><li>Business models and human capital strategies must match.  </li></ul><ul><li>Taking advantage of the observations and records of actual events maintained in your company’s HR information systems helps you discern how your business model and human capital strategies have been working for or against each other. </li></ul>2008 © HireSmart All Rights Reserved.
  9. 9. Principles of Human Capital Management <ul><li>There’s a floor to cost reduction but no ceiling to value creation.  </li></ul><ul><li>Find the key points of leverage for increased profits. </li></ul><ul><li>View your human capital as a value-producing asset instead of a cost to be minimized, reduced, or reined in.  </li></ul><ul><li>New management tools now exists to help you analyze how key outcomes such as productivity are affected over time by human capital attributes and practices. These tools help you predict the return on your human capital investments. </li></ul><ul><li>Identifying and focusing on what’s important will drive value. </li></ul>2008 © HireSmart All Rights Reserved.
  10. 10. 2008 © HireSmart All Rights Reserved. Selection Human Capital Strategy Performance Management Revenue Per Employee Cost Per Employee Profit Per Employee Recruitment Coaching & Mentoring Human Asset Profiles Career Development Plans Core Values Core Competencies Performance Improvement
  11. 11. Activities of Human Capital Management <ul><li>The quality and performance of our people is what sets us apart in an intensely competitive market! </li></ul><ul><li>Recruiting and hiring the best available talent </li></ul><ul><li>Developing and motivating people to reach their fullest potential </li></ul><ul><li>Retaining talent (and the investments made in them) </li></ul><ul><li>Minimizing risk and cost on the human side of the business </li></ul><ul><li>Designing talent management information systems </li></ul><ul><li>Implementing performance based compensation systems </li></ul><ul><li>Developing your Employer of Choice Brand </li></ul><ul><li>Designing coaching and mentoring programs </li></ul><ul><li>Applying performance management technologies </li></ul>2008 © HireSmart All Rights Reserved.
  12. 12. Finance Driven Business Model <ul><li>Money Drives Value - Budget Driven! </li></ul><ul><li>Focus on tangible assets </li></ul><ul><li>Valuation of physical and financial assets </li></ul><ul><li>Use decision criteria for physical capital investments </li></ul><ul><li>Manage costs </li></ul><ul><li>Focus on the past (cost measurement) </li></ul><ul><li>People are treated as expenses and salary costs </li></ul><ul><li>Focus on present cash flow </li></ul><ul><li>Focus on fixed budgets and periods </li></ul><ul><li>Focus on short-term profitability </li></ul>2008 © HireSmart All Rights Reserved.
  13. 13. Human Capital Driven Business Model <ul><li>People Drive Value - Event Driven! </li></ul><ul><li>Focus on tangible and intangible assets </li></ul><ul><li>Valuation of physical, financial, human and structural assets </li></ul><ul><li>Use decision criteria for knowledge and human capital investments </li></ul><ul><li>Process and customer cost focus </li></ul><ul><li>Focus on the future (value creation measurement) </li></ul><ul><li>People are treated as expenses and investments </li></ul><ul><li>Focus on present cash flow and future revenue streams </li></ul><ul><li>Focus on dynamic budgets and revenue streams </li></ul><ul><li>Focus on short-term and long-term profitability, added-value and sustainability </li></ul>2008 © HireSmart All Rights Reserved.
  14. 14. HCM Glossary <ul><li>Human Capital Strategy </li></ul><ul><li>A business strategy that links the competencies, motivations and satisfactions of its employees directly with drivers of value for customers, which in turn drives profitability for the enterprise. Human Capital decisions are guided by data-driven, results-oriented planning and accountability systems. The keys to a successful HCM strategy are process efficiencies, effective use of information technology and business metrics. </li></ul><ul><li>Talent Management </li></ul><ul><li>Identifying mission-critical values, competencies and talents needed in the current and future workforce. Clarifying the methods that will be used to recruit, hire, develop, manage and retain a high performing workforce. </li></ul><ul><li>Performance Culture </li></ul><ul><li>A diverse, results-oriented, high performance workforce, with a performance monitoring system that effectively differentiates between high and low performance and links individual / team / departmental performance to organizational goals and strategic objectives. Compensation is directly linked to performance. </li></ul>2008 © HireSmart All Rights Reserved.
  15. 15. HCM Glossary <ul><li>Human Capital </li></ul><ul><li>The sum of a company's employees including their skills, competencies, talents, creativity and know-how.  Within each employee is the knowledge the company seeks to utilize.  </li></ul><ul><li>Intellectual Capital </li></ul><ul><li>The sum of a company's ideas, inventions, technologies, knowledge, computer programs, patents, trademarks, designs, methods, systems, processes and publications. When codified, defined, written or committed to media form, the company's intellectual assets can be moved, leased, or sold. When these intellectual assets (IA) are legally protected we call them intellectual property (IP). </li></ul><ul><li>Structural Capital </li></ul><ul><li>The sum of a company's tangible assets including financial assets, buildings, machinery and equipment, manufacturing facilities, distribution channels and sales outlets.  </li></ul><ul><li>Customer Capital </li></ul><ul><li>The sum of a company's customers including their names, contracts, contact databases, loyalty, satisfaction, references, testimonials and future revenues.  </li></ul>2008 © HireSmart All Rights Reserved.
  16. 16. About HireSmart <ul><li>  </li></ul><ul><li>HireSmart is a human capital management firm that provides consultation and outsourcing for strategic recruiting, talent assessment, selection, development and performance management. We help businesses increase productivity per hire, reduce turnover and improve performance. Our mission is to help our clients maximize their Return on Investment in human capital. We help managers lower the costs and risks associated with unproductive hiring decisions: turnover, low performance, litigation, absenteeism, sabotage, and theft. </li></ul><ul><li>  </li></ul><ul><li>HireSmart provides customized solutions that measure the organization’s outcomes for each human capital strategy implemented. We help you make your staffing process more attractive, convenient, efficient and cost-effective. We help you design continuous improvements in your human capital systems leading to increased profit per employee. </li></ul>2008 © HireSmart All Rights Reserved.
  17. 17. About Neil Clark <ul><li>Dr. Neil Clark is an Arizona Licensed Psychologist with over twenty years of professional experience in personnel and organizational psychology.  His mission and purpose is to help managers improve their talent management effectiveness.  Neil is currently the Executive Director of HireSmart, a human capital management firm that uses online sourcing, screening and selection tools to help companies reduce the high cost of hiring mistakes.  His doctoral research was in organizational development.  Dr. Clark is a Strategic Business Partner of Profiles International Inc., a leading international human capital assessment company.  He is also a Professional Associate of Human Resource Development Press.    He currently works with many small firms and with several Fortune 500 companies to develop and monitor high performance work systems.   Neil is a current member of the Arizona Psychological Association, the Personnel Testing Council of Arizona, the Knowledge Management Forum and the Arizona Better Business Bureau. </li></ul>2008 © HireSmart All Rights Reserved.
  18. 18. Contact Info <ul><li>HireSmart, LLC </li></ul><ul><li>Human Capital Solutions </li></ul><ul><li>4140 E. Baseline Road, Ste. 101-317 </li></ul><ul><li>Mesa, Arizona 85206 </li></ul><ul><li>480.503.2945 (phone) </li></ul><ul><li>866.296.4277 (fax) </li></ul><ul><li>[email_address] (eMail) </li></ul>2008 © HireSmart All Rights Reserved.