Leadership for a Sustainable World: The advent Human Governance
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A presentation at Dublin City University's Leadership & Talent Institute conference 23 March 2016 on the emergence of Human Governance
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Leadership Maturity Rating
This document outlines six stages of leadership maturity in an organization. Stage 1 involves compliance-focused reactive leadership. Stage 2 sees the emergence of good leadership practices. Stage 3 brings effective leadership integrated with operations. Stage 4 adds a focus on human capital and values. Stage 5 transitions to strategic priorities. Stage 6 results in the organization operating as a coherent value system. The stages progress from an initial lack of conscious leadership to a highly mature integrated approach.
High value HR slides Paul Kearns/IHRM keynote 11 jun14
The document summarizes a presentation by Paul Kearns on how HR professionals can add significant value to organizations in the 21st century. Kearns discusses several key questions about why some companies consistently outperform competitors in areas like market capitalization, innovation, and avoiding disasters. He argues that HR has not provided convincing answers to these questions due to a lack of evidence-based practices and data-driven problem diagnosis. Kearns then outlines a six-stage model of HR maturity where organizations transition from seeing employees as costs to a whole system view of human capital as a valuable asset.
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The document discusses HR's value and the level of organizational maturity needed to properly measure and analyze HR's impact. It argues that immature HR focuses too much on easily measurable activities and outputs, while more sophisticated analysis requires viewing HR through the lens of business objectives. True value is determined by factors like quality of hires, integration, and long-term human capital development. The document advocates adopting standards and principles from fields like medicine to bring more scientific rigor to HR measurement and establish causal links between people practices and business outcomes.HR Maturity: Mature Management THINKING, PEOPLE, PRACTICE
IHRM is based on two very simple notions. One is that corporate behaviour only has legitimacy when it is driven by maximizing societal value, rather than just rewarding shareholders and executives. Another is that no organization can maximize its value without maximizing the value contribution of all the people who work for it (including suppliers). Mature executives are those that understand these to be self-evident truths and run their organizations accordingly. Such organizations are currently extremely rare. IHRM’s goal is to make this the prevailing paradigm.
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Leadership for a Sustainable World: The advent Human Governance
- 1. Leadership for a Sustainable World The advent of Human Governance
- 2. Value orientation – short, longterm;narrow or broadbased? “ ” Theparadox is that by not pursuing profitability to the exclusion ofall else, the Great Engine companies in their Golden Age would achieve enormous increases in value...whereas,by single-mindedly pursuing profit...these same companies and their successors actually createdless genuine, lasting wealth; indeed, they would often destroy it. (The Puritan Gift, Kenneth & William Hopper)
- 3. Defining & adding Value 3 € + = Increased Output (O) Reduced Cost (C) Increased Revenue (R) Increased Quality (Q)Value of business now Value of Business in 1, 2, 5, 10 years ADDED VALUE € € Societal value generated by producing the best quality products/services at the lowest possible cost (including any external harm e.g. environmental)
- 4. HUMAN GOVERNANCE People’s behaviour aligned 4 A Coherent Model for Societal & Business Value through Human Governance BUSINESS aims to maximise returns SOCIETY determines acceptable corporate behaviour VALUE
- 5. Understanding how human capital drives value & risk:
- 6. • “In principle, our organization can only maximize its value if it aims to maximize the value potential of all its capitals; including the human capital it directly employs or utilizes via its value (supply) chain, or through other third party stakeholders.” • “As a responsible organization, using scarce resources, the only legitimate and sustainable management philosophy is one of never-ending, continuous improvement.” • “We can only produce the best shareholder and societal value by providing our best possible products/services at the best possible cost, without undue external impact e.g. on the environment.” Human Governance emerges with the recognition that the organization is committed to the never-ending pursuit of societal value through realizing the full potential value of its entire human capital. Maturity statements
- 7. THE TEN ‘PILLARS’ Value Motive Whole system Learning Organization Improvement philosophy People risk Human capital ethos Trust, engagement, cooperation Performance system Communication Business/peo ple strategy Maximizing value & understanding risk:
- 8. Measuring or rating maturity: 8 “Art is about learning to see and to observe. And the sciences are about seeing and observing.” – Ed Catmull, Pixar
- 9. Stage 2 Basic professional practice & simple processes Stage 3 Seeking more from people using more effective methods Stage 4 Human capital recognised as integral to business operations Stage 5 Transition period from operational to strategic focus Stage 1 Compliance only Board & Executive do not recognize potential value of human capital Stage 6 Organisation becomes a whole human governance system Stage 0 No interest in professional management of people The MI & OMS Scales – Board/Exco & Investor Perspectives OMS© 2016 HIGH VALUE REALIZATION – REDUCED INVESTMENT RISK – GREATER STABILITY UNREALIZED VALUE – GREATER INVESTMENT RISK & INSTABILITY OMR© AA- AAA BBB BBB- BB+ B- D CCC- BB BB- B B+ CCC+ CCC C CC BBB+ A- A A+ AA+ AA
- 10. The Organization Maturity Index: OMI:150 (UK) View the live index at: www.omservices.org
- 11. Value vs supply chain orientation Embedded societal value & responsibility Truly inclusive workplaces Best/sustainable resource use Learning, knowledge & innovation High trust, cooperation & informed decision making Human Governance drives higher value, lower risk & ‘good’ outcomes “social, economic, environmental, and ethical factors directly affect business strategy—for example, how companies attract and retain employees, how they manage the risks and create opportunities from climate change, a company’s culture, corporate-governance standards, stakeholder-engagement strategies, philanthropy, reputation, and brand management.” – David Blood 2007
- 12. Linking Purpose, Human Governance & Value