Recently, it was rumored that the management of NBC announced that there would be staff cutbacks. This purveyor of "Must See TV" needs to do some trimming, so the story went, because, in part, there were some hefty contracts that a few of the network's stars had signed (e.g., Academy Award-winning Helen Hunt certainly makes more dough than she did before picking up Oscar). Presumably, management figures that the actresses and actors in their lineup are valuable to the extent that they can and do attract viewers. Viewers can then be parlayed into increased advertising rates. As for the staffers that will find themselves unemployed (if this is, indeed, true): Well, someone calculated that their value is less than their return, at least now in the changed context of the existing market. But know one thing: Not everyone can be a star in the context of actresses and actors, but everyone has the potential to be superlative—and therefore valuable—in their own area of endeavor.
"`People are our greatest asset.' Do these words ring hollow for you? If so, you're not alone." So opens Delivering on the Promise: How to Attract, Manage, and Retain Human Capital, a new book by three partners in the accounting firm Arthur Andersen, Brian Friedman, James Hatch, and David M. Walker (The Free Press; $26.00). It is sometimes hard to reconcile that claim about the importance of people with the frequency with which they are jettisoned from their positions in the name of economy.
But what an increasing number of companies are finding, and will continue to discover, much to their chagrin and frustration, is that good people are hard to find and perhaps harder to keep.
Although it may be unsettling from a personal point of view to find one's self commodified, as in "human capital," the authors actually argue that people need to be perceived in a more humane way than has been the norm throughout much of the world for perhaps as long as people have been organized to do work. That is, they explain, "In order to value people, companies must move beyond the notion of human resources and toward the notion of human capital." The "human resource" point of view is one that perceives people like a commodity of which there is an endless supply: "There's more where that came from!" is the sense of this approach. People are treated as if they can be readily replaced.
The "human capital" point of view is one that recognizes that, as the authors write, "Money and technology can create nothing without people." So by investing money in people (through education and training) and by equipping them with the technology necessary to do their jobs, the result is a benefit to both the individuals and to the company.
Delivering on the Promise is fundamentally based on the Arthur Andersen "Human Capital Appraisal Process," a methodology, spelled out step-by-step in the book, that managers can use to align their staffing with their strategy ("What drives business executives...is, was and ever shall be strategy, not standards. That is, if you tell managers to do something because it is the decent thing to do and others have made money doing it, they may take the action, but they are unlikely to `run with it'—to go beyond it to create new levels of performance."). The process includes five stages—Clarify, Assess, Design, Implement, Monitor—and five factors—Recruitment, Retention, and Retirement; Rewards and Performance Management; Career Development, Succession Planning, and Training; Organizational Structure; Human Capital Enablers. Although the book is more oriented toward human resource professionals—who maybe ought to change that label to human capital professionals—the points the authors are making are pertinent to all of us who have to make a living, whether it is at a TV network or an auto company.
Because the environment is constantly changing, in order for anyone to have continuing value to an organization that person must change, too. Everything I Need to Know I Learned in Kindergarten may be a clever title for a book about how to behave, but there are too many people who replace the last word with College and think that they've got it made. Consequently, they don't keep learning. When tough decisions are made about who stays and who goes, the stars in the organization are the ones who get the reward.
Although it is important for organizations to make investments in their people, it is more important for each of us to do what it takes to make ourselves more valuable.
Helen Hunt won her Academy Award for her role in As Good As It Gets. You can be certain that she's honing her abilities so that she'll get better. It is a good lesson for all of us. We may not get million-dollar salaries as a result, but we probably won't get pink slips, either.