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Realizing the best way to invest in your prime resource-your employees
The following article is excerpted from the new book The ROI of Human Capital: Measuring the Economic Value of Human Performance, published by AMACOM, a division of the American Management Association, New York. Dr Fitzenz is the founder of the Saratoga Institute, Santa Clara, CA, and is widely recognized as a leader in the field of human resource benchmarking.
Almost everyone agrees that people are the prime resource today. So, it follows that we have the best chance of leveraging our investments if we build on that resource. All successful strategies have resource leverage at their heart. Some experts offer five ways to leverage resources:
Concentrate resources on strategic goals.
Accumulate resources efficiently.
Complement resources from different areas for higher order values.
Conserve resources wherever possible.
Recover the investment in resources rapidly.
In simple terms, this reads as focus, be efficient, combine, save, and manage for ROI. At this point, I trust that you are sold on the premise that people do add value and that this value can be measured in financial terms. So, the most important question for you is, What can you do to get a better return on your investment in your human capital?
There is no shortage of theories and models of management and leadership. I myself have listed over 40 management theories that have hit the market in the last 50 years, and they are just the ones that attracted some attention. Each year, several hundred books are published on management and leadership. The total number of titles published on the broad topic of organizational management in the last 30 years of the 20th Century reached nearly 10,000.
The irony of this flood is that we don't know much more about leadership and management of people today than we did 2800 years ago with Homer's Odyssey and Sun Tzu's The Art of War. The Golden Rule and common sense seem to be as good as many recent theories, and better than most of them. Most research is characterized either by minute studies with little generalizability or by broad, unsupported hypotheses that are impossible to put into practical terms. Academicians who could not organize a two-car parade...