Getting the Most Our of Your Workforce - Manage It As Part of Your Intellectual/Intangible Capital

Gary Hamel has a new article on human capital called Management’s Dirty Little Secret. He talks about the very large lack of engagement of most employees (in a global survey by Towers Perrin, only one-fifth of employees are “truly engaged”).

Hamel explores all the reasons that this may be true including ignorance, indifference and impotence.

But his discussion is totally focused around the human capital itself. He doesn’t make a good case for how human capital fits into the value creation process of today’s knowledge-based economy. 

Hamel isn’t alone. This happens all the time. Human capital is compartmentalized. But we are never going to solve the problem if we look at people as a separate factor of knowledge production.

That’s why the intangible capital (aka intellectual capital) perspective is so important. By looking at  human capital, relationship capital and structural knowledge capital as a system directly linked to revenue and customer value creation, IC makes the links between human capital and the bottom line very clear. That’s why we take the extra step with our clients of actually developing an inventory and a model of their core competencies, processes and relationships as a first step to understanding the IC-performance connection. Here’s an example of an IC factory Lego model that illustrates what I mean.

Because human capital is important. But until you make that direct connection between people and the bottom line, a lot of businesspeople are going to continue in their ignorance, indifference and impotence.