Reinventing HR

There are three forms of capital namely, human capital (knowledge, skills and abilities of employees), social capital (social networks and relationships between employees) and organisational capital (practises and systems in place).

Although pay and benefits initially attract employees, top-tier leadership organisations focus on retaining and developing talent.

Talent refers to individuals who have the capability to make a significant difference to the current and future performance of the company.

It is critical to the success of any people-based strategy to attract and retain the very best. Becoming an employer of choice, however, requires an aligned HR system. It is very easy, but very expensive, to provide compensation and benefit levels that will be attractive. The challenge is to also structure an HR system that selects, develops and produces a level of performance that can justify those investments. The issue today is therefore not the talent; the issue is for the right talent which grows the business. Without critical talent and skills, companies cannot grow their businesses.

Cash is an item on the balance sheet that reports the value of a company’s assets. Cash in-flows arise from three activities; financing, operations, investing. Cash-out flows derive from expenses or investment.

Competence refers to knowledge, skills, abilities and personal characteristics related to performing one’s job. The following HR competencies were identified from the survey and will be discussed in this chapter:

If HR is not embedded in the organization, it is not successful. It needs to be visible. It needs to understand the business better in order to bring greater value to the table.

Connecting the company’s culture with its objectives, as well as defining and communicating what makes their organisations great places to work.

Finance, supply chain management and IT have managed to remain relevant to operational requirements. Their functions have evolved into value added propositions to the executive and operational staff. HR, on the other hand, is – for a variety of reasons – no longer seen to add relevant value and so finds itself unable to influence or impact an organisation’s strategy. This is a huge paradox.

Increasing pressure from executive management has forced the profession to justify its existence through the identification of HR metrics.