- HR can turn human capital into productivity and economic value for their organizations, writes the Harvard Business Review. The scarcest resource isn’t financial capital, but human capital, according to the Review.
- Human capital is measured by time, the hours employees work; talent, their skills and capabilities; and energy, the level of employee engagement. HR can bring together those factors to create value for companies.
- Harvard Review studies show that the expectations for employee engagement are too low. The Review says HR can raise employee engagement by eliminating time waste, helping employees connect to their organization’s mission, and raising the level of employee engagement by rebranding, repositioning and reorienting itself to lead these efforts.
The Review points out some common, often unfair, criticism of HR’s effectiveness. It rightfully acknowledges HR as the central force for developing human capital. But along with turning human capital into productivity and economic value for organizations, HR must develop employees for their own sake through training and career advancement.
Historically, HR practitioners have fought for the proverbial “seat at the table” with company chiefs and revenue generators like marketing and finance managers. HR has overcome that barrier in many organizations, but it remains a side consideration for many, especially startups.
To achieve many of the goals the Review outlines, HR professionals must not wait for an invitation to lead these efforts, but demonstrate that they’re the most capable of all managers for this role by gathering data to track their effectiveness. Organizations, in turn, must recognize HR’s value and ensure that it has the resources necessary to carry out its functions.