The Importance of Human Capital Management for Your Organization
Read how to effectively utilize the people within your nonprofit and NGO by understanding the importance of human capital management.
Philanthropy University is the new tech-enabled platform that transforms the impact of local organizations working to deliver sustainable development for all.November 9, 2018
The Importance of Human Capital Management for Your Organization
We live in a time where talent mobility, technology, and a changing workforce has had a significant impact on the way organizations operate. People are looking for an environment with meaningful work, a good organizational and job fit, and strong leadership. In organizations like that, employee retention and performance excels. But, it is not a one size fits all solution, and the continuum of strategic human capital management takes a lot of work. That is why the importance of human capital management has become such a key issue for organizations worldwide.
Why Is Human Capital Management Important?
Because employees are the most valuable resource to an organization. They determine how much an organization can grow, innovate, and reach its goals. By creating strategies to attract, retain, and develop employees, your organization will be at a significant competitive advantage.
Employees leave for a number of reasons including retirement, dismissal, negative work environment or a better salary. Having effective human capital management will help employees when entering your company, in overseeing their roles, and ensuring they do their jobs effectively. Creating a strategic human capital management plan can transform the way employees interact and perceive the organization in which they work, so it is essential to consider all aspects of an employee’s life-cycle at your organization.
Human Capital Management Training Course
At Philanthropy U, we recognize the importance of human capital management. So, in partnership with Berkeley Haas and taught by instructors from Acumen+, we developed a free, online Human Capital Management Course that leads you through the basics of developing a human capital strategy. You will learn how to strategically design your organization’s values and culture, recruit and hire the right people, adapt your organizational structure as you scale, and build effective teams.
The course runs on a recurring basis and is six weeks long, with an average commitment of 3 – 4 hours a week.
Understanding how strategic human capital can be developed
A holistic and strategic human capital management approach considers all elements of HR as one ecosystem. Each topic of our human capital management course is focused on a specific component of the ecosystem.
Developing Culture and Values
It is critical that your organization’s values and culture are developed with purpose. Today, people both within and outside the organization have the inside scoop on company decisions, employee thoughts and feelings, salaries, and management styles. Employees have so many employment options at their fingertips with greater insight into the ways that different organizations operate, so leaders are now treating employees more like customers.
Employees no longer only go to work for a paycheck. They are looking for purpose, relationships, impact, and personal growth. Managing all these expectations can be overwhelming, so finding a balance that works for your organization is key.
The world is also more and more connected through technology, which means that employees oftentimes end up working longer hours with more flexibility in the structure of their day. By putting consideration into job design and management, leadership development, and work environment, the culture of the organization can adapt to this changing work environment. This ultimately leads to greater employee retention and engagement, which results in increased productivity.
Developing Your Organizational Structure
Along with a greater investment in human capital, organizations are reconsidering the makeup of their organizational structures. Prospective employees are looking to be connected to the business as a whole, not just their team. They also want more autonomy and decision-making power. Organizations are now focused on shifting organizational structures to accommodate that for employees. The most radical organizations have shifted into managerless structures, while others have worked to become more decentralized. Many companies believe that giving employees more autonomy to make decisions and manage their work, holds them accountable and adds a new layer of meaning to their job.
This human capital management course can help you develop an approach that will increase the satisfaction and productivity of your employees.
Recruiting and Hiring
Strategic human capital management involves developing practical tactics for recruiting, interviewing, hiring and firing employees — which could make or break the way your organization is perceived, who chooses to work there, and how you get the best candidates for roles. Hiring someone to simply fill a void is never the right answer. It creates more work for the team, and if the person is not the right fit, or is not effective at their job, it could mean problems for the organization’s future.
It is important that hiring teams understand a candidate’s background, interest, and professional goals and qualifications so that they can put a comprehensive plan together for that employee’s trajectory within the company. Not only does this make employees feel important, but it can also help create a longer-term vision for staffing.
How can human capital be developed? By ensuring that employees feel valued and rewarded. This is absolutely necessary in order to make strategic human capital management work for your organization. By structuring monetary and non-monetary compensation effectively, you can show employees that your organization cares about them as individuals, not just as a member of your workforce. Our human capital management course will help you develop a compensation program for employees that works for your budget and speaks to employees.
Human capital management training provides you with strategies to implement professional development programs and manage employee performance. More and more employees are looking for ways to develop their skills so they can advance within their organizations and their careers. It also allows organizations to promote from within, which eliminates costly turnover and increases employee retention.
Having key milestones, goals, and systems for tracking performance will help you navigate when an employee is succeeding in their work, as well as understand if they need support. By putting metrics in place to track productivity and performance, employers can more easily distribute benefits for an employee’s efforts.
Our human capital management course can be beneficial for anyone looking to support staff development. We especially recommend human capital management training for nonprofits leaders, human resources staff, and people managers.
Understanding the importance of human capital management is essential to doing a better job at hiring the right talent, on-boarding and training them, and creating a loyal, well-performing team. If you are looking for more information on human capital management, or want to engage in meaningful discussions around the topic, check out our community pages.
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