MEASURING A COMPANY’S ONLY GROWING CAPITAL ASSET – ITS HUMAN CAPITAL ASSET
How can a business manage the productivity of its assets if it can’t measure its net-worth? The intent of creating performance measures is to “provide reliable and valid information on performance.” (Theurer 1998, 24)
As the old adage goes, “what is not measured is not managed”. At this stage of managing the business’s human asset, the business naturally wants to realize its return on its investment it has placed into its employee/s. In order to evaluate this net return (R.O.I), employee performance must be measured …if not, it begs the question why a business would want to invest so my money into this investment in the first place!
Managing the business’ human asset will only be realized by establishing appropriate measures or Key Performance Indicators (K.P.I) that are not just relevant to the employee, but are relevant to the business’s overall success.
Once K.P.Is are defined clearly and measure the performance and productivity of its employee asset accurately, a significant focus can be placed on assessing the net worth of its employee asset. In addition, the business will also be able to provide feedback to its human asset, supporting development/growth versus disrupting a potential return, subsequently preventing the business from growing its most important and only growing capital asset – its people.
Workplaces and HR ALL-IN are on a mission to simplify and bring back the common sense in measuring human asset performance, enabling business to accurately invest in areas that will save and make the company more money.