In any organization, it is analyzed that there are multiple tangible as well as intangible sources of competitive leads and human capital is considered as one of the most important asset/source to be studied and maintained for the positive growth and development of an organization. There are six effective ways through which we can measure the human capital as a strategic asset.
Focus on the strategic impact of human capital
Human capital is known as an illusive concept and the management is not used to think about the cost of hiring and the cost of training. Managing human capital with respect to the focus on the strategic impact means to manage their performance behaviors.
Beware of Human Capital Alchemy
In a traditional way, the employees are considered as the money makers. There are some simple ways through which the human capital alchemy could be noticed and considered. The most popular ones are hiring, rewards, development, and training.
Need to Measure both HC levels and Relationships
It is known that the human capital affects the company in an indirect way. The balanced scorecard terminology is one of the best ways to measure the relationships and the HC levels. Through this strategy, the employee’s role in firm’s performance could be analyzed.
Recognize the limits of benchmarking
Looking for the external pressure and the benchmark for the measurement of the human capital would explain that every organization have the same implementation system as well as the same strategy used. Everyone in the management would be required to follow this new perspective for proper recognition of the limitation of the benchmark affecting the human capital.
Don’t start with the measure
Whenever a meeting starts, managerial post requires a list of measures they require to keep a follow-up. They want it to be firmly implemented from start to end. No such list exists for an ongoing improvement in a company or a project.
Think in terms of the human capital “architecture”
Managing and measuring the human capital is a challenge because of lots of confusions. Everyone is required to use a new perspective and this should start with a central role of human capital architecture. While thinking architecture, it is helpful in creation and management of human capital.
Becker, Brian E., Mark A. Huselid, and Dave Ulrich. “Six key principles for measuring human capital performance in your organization.” Business and Society Review 1 (2002): 71-75.
Fitz-Enz, Jac. ROI of human capital: Measuring the economic value of employee performance. AMACOM Div American Mgmt Assn, 2000.