How to manage human capital?
Summary
As a result of increasing globalization, organizations today need to be increasingly competitive, since they are linked more than ever to factors beyond their control and depend more on the environment and its abrupt changes; therefore, proper Human Resources Management is essential, whose objective is to help people and organizations achieve their goals.
In this sense, it is important to achieve a system of action where the conditions are created so that your human resources contribute to the maximum, with their talent, effort and dedication.
Introduction
Given the rise of new technology and the growing importance that human resources have taken in the organization, a new approach has been developed within organizational management that involves not only human resources; but also new information and communication technologies, management methods and organizational culture in general.
Traditionally, the assets of an organization have been based on a single factor: the financial or economic factor; however, these elements no longer represent a competitive advantage for them, nor is technology. In this environment, people become the main asset and managing them is no longer an option; but an indispensable requirement of this new era.
Thus, the value of an organization no longer resides in its tangible assets but in the technical and specialized knowledge of its personnel, in its experience, in intellectual property, the loyalty of clients, in short, in what has come to call knowledge.
That is why the present work aims to present and assess from a current perspective, the problems that companies or organizations are in today in their quest to stay and compete within a global market that imposes ever greater requirements.
Paradigms of the third millennium.
Nowadays, it is not surprising to find bibliographic sources that refer to: globalization, computer revolution, intellectual capital, revaluation of the human factor, and many other issues that account for the need for change in the way of managing the human element. in organizations.
Much less astonishing is the fact that these organizations must adapt to the demands of the environment and adapt their structures to respond to the paradigms of the third millennium; assuming a creative and innovative planning system that allows us to "foresee" the future so that we do not have to "suffer".
However, organizations have been created and managed to function in the relatively stable and predictable environment offered by the industrial age. Consequently, the current speed of organizational renewal is too slow to cope with the speed of change that the “Age of Knowledge” has brought to the market, which consists of the idea of an intelligent society, in which routines will pass for machines and people will do the smart work.
This paradigm that begins to identify itself as the power of the New Economy, can be characterized by the following keys:
- The speed of change in technologies (mobile telephony, Internet, etc.). Globalization that allows the presence of products or services in as many markets as possible and in a short period of time. The increase in the economic culture of the consumer or customer, which demands higher and higher levels of excellence for the product or service and, therefore, prevents inefficiencies from being transferred from companies to their offer. Knowledge and information (intangibles) as elements that add greater value to the product or service.
Likewise, the characterization of this new generic environment is having a direct impact on the conventional company, fundamentally through the modification of classic patterns of work organization, the enhancement of internal communication and the need to incorporate Your offer of products or services is increasing the level of intangible factors.
In this way, they become new competitive strategic vectors in the organization, which will depend on their ability to incorporate in the shortest possible time the competencies and skills directly related to change management (innovation), knowledge management and updating be active through excellence training.
Druker already mentioned it: “Knowledge in this new scenario is a fundamental part as a competitive advantage for new companies. Thus, knowledge is a resource that all organizations possess, therefore, it can be stored, used, mobilized and developed, that is, managed in different ways, constituting a strategic asset that is also known as intellectual capital ”.
Indeed, Toffler in his book "Change of Power" quoted: just as "knowledge is power", in our current environment "knowledge equals change".
Wriston, W. (1992): “the new source of wealth is not material; it is information, knowledge applied to work to create value ”.
Likewise Gates, in an interview for Times magazine (1997): “We win because we hire the smartest people. We improve products based on feedback until they are the best. Every year we retire for a few days to think about where the world is going. " In other words, the secret to Microsoft's Midas touch is to work endlessly to increase Microsoft's "intellectual capital".
However, for knowledge to become a source of competitive advantage, it is not enough for it to exist; it must be captured, created, distributed, stored, shared and used by the members of the organization.
Business competitiveness.
As mentioned above, the world is walking or is already in what has been designated as the “Knowledge Society” and brings with it new problems and new challenges, one of which, immediately, has to do with the high factor of competition. among companies at levels just a few inconceivable years ago.
In today's economy, to effectively outperform the competition, companies must look for ways to make the most of their assets, although generally one of the main assets, employees of the company itself, is often overlooked.
However, some entrepreneurs not only assume the competitiveness of their company in producing and selling at lower prices; but in providing its products with qualities or differentiation that allows it to be competitive even though its production costs are higher than those of its competitors. Those qualities or differences go through the creation of human value.
"What makes one product more in demand than another, that its production cost is lower than the competition, or that the systems and processes applied by the company are more effective is human value: the creation of human value, its incorporation into the product as innovation, quality or design ”.
So they need to divest themselves of traditional management systems, with rigid approaches that cannot adapt to current business challenges. Instead, they "need strategic and flexible performance management systems that are capable of adjusting to sudden and drastic changes in company management and that leave room for maneuver for performance planning and ongoing communication."
Thus, companies must focus on labor flexibility, implementing changes in the procedures and processes that govern the company's activity and mainly on the ability to act among the people in the company.
The people needed in the future will have very special characteristics, they will need people who are trained but who, in turn, have very specific features in terms of how they act and see life. People with very specific personal characteristics will be searched:
- Flexibility: A person capable of adapting to the philosophy of the company, to market movements and to the needs of customers. Autonomy: Professional who has the ability to decide for himself, who does not depend on the company to carry out his work.
You must be a freelance professional, but at the same time, you know perfectly how to work as a team.
- Creative: Able to innovate and open to new opportunities.
Therefore, human capital management is a critical factor in creating value, maintaining a competitive advantage and being successful.
In most companies, this is achieved through intangible resources: investment in research and development and innovation, knowledge, skills and abilities of staff.
Human Resources and Human Capital Management.
Many scholars in the field of Human Resources Management consider that the way of managing human resources has evolved in recent years as a result of market globalization and the abrupt changes that produce instability in the environment.
Thus, the companies of the future must adapt to these changes with the same speed with which they occur and seek new competitive advantages that keep them in the market. "A human resources strategy must provide systematic, proactive and flexible adaptation to changes in the environment and have a vision of the future integrated into the company's global strategic approach."
These "challenges or demands of the environment", named after Gomez-Mejia, Balkin and Cardy, "are represented by forces external to the organization and therefore beyond its control." But organizations not only face external demands; They are also conditioned to face their own demands as an organization, seeking a better competitive position, flexibility and adequate organizational restructuring that allows them to adapt to these changes.
Authors such as Kaplan and Norton (2001) highlight such importance when pointing out that, "in a context of high competitiveness, you have to fight to grow and develop in order to just stay in the same place". This forces organizations to increase the demand on their workers. The fulfillment of the tasks, functions and responsibilities of the position is no longer enough. Much more is required to create value and allow the organization to survive in a highly competitive environment.
The impact of new technologies on HRM requires new strategic approaches from companies. These new strategies will be oriented towards teamwork, sharing knowledge, considering the user as a RR manager. HH., Working with simple and practical tools, a culture of feedback and speed of response. In this way, the new HR department will go from being an internal customer support to becoming a management content provider.
But what is Human Resource Management? Much has been said about this topic, and there are multiple definitions in this regard.
For example, Chiavenato defines it as: “the planning, organization, development, coordination and control of techniques capable of promoting the efficient performance of personnel in the organization, to achieve the individual and collective objectives of the work. It means conquering and keeping people in the organization working and giving their best with a positive and favorable attitude ”.
For Agudelo (1994): “managing human resources is guiding staff to act in accordance with the plans outlined, as such, managing is guiding human resources to adopt those behaviors and perform those actions required to achieve the goals set. by the highest level managers ».
Therefore, human resource management is the set of techniques, procedures and activities to guarantee the availability of human potential, its active, creative, satisfied, motivated and committed behavior with the mission and strategy of the organization.
For his part, Cuesta (2005) emphasizes the importance of conceiving human resources as the main competitive advantage: “the basic competitive advantage of companies at the beginning of the 21st century will not lie in natural resources or specifically in energy resources, it will not lie in financial resources, and it will not even lie in technology: the basic competitive advantage of companies at the beginning of the 21st century will lie in the level of preparation and management of human resources. ”
We are heading towards the triumph of the human factor, the demand for its valorization above any other ingredient. Today optimizing human capital means expanding the knowledge, skills and abilities of each employee and doing it in line with business objectives.
Now, what is meant by human capital? Human capital is understood as the knowledge, skills and abilities of employees, inherent in any organization. Thus, companies that acquire and use their human capital more effectively than their competitors create greater value for their shareholders.
In order to plan the most effective use of the knowledge of their people, companies must understand the “stock” of human capital that they possess and, at the same time, the knowledge, skills and abilities that they will need to remain competitive in the future.
Conclusions
In conclusion, it is clear that the demands made by the environment make the stability of companies more complex, therefore managing all the people involved in it will be the only option for the best present and future job performance.
It also becomes clear that, even though intangible and often hidden from the administration's gaze, intellectual capital is essential for the long-term prosperity of organizations in the knowledge age.
Therefore, knowledge is an instrument of strategic importance, capable of contributing substantially to the success and development of the organization, becoming a key element that must be carefully managed.
On the other hand, there is no doubt that today one of the fundamental elements for obtaining competitiveness by companies lies in the creation of human value, improvement in the levels of management of their human resources and in the flexibility of acting on them.
In other words, people represent a very important part of the capital of a company, they are a source of value creation much more important than things and it is these that create more competent companies.
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