Procuring Human Capital

Ensuring that an organization is attracting, procuring, and keeping its human capital is vital for a company to be competitive in today’s workforce. However, despite leadership contending that human capital is their “most important asset,” few can confidently state the actual value of that holding. Efficacious organizations increasingly realize the varied factors contributing to an employee’s value. These valuation factors include technical knowledge, ability to learn and grow, decision-making capabilities, motivation, commitment, and teamwork (Mello, 2019).

Employees and these skills represent a significant asset and value to an organization. Measuring the monetary values of these items and the employees that possess them has been the focus of organizations and studies for decades. Dr. Mark Huselid performed one such study in the mid-1990s to help determine the return on investment an organization can expect from employees. Identifying what was called “high-performance work systems” (HPWS), Huselid confirmed that integrated, strategically focused HR practices were directly related to profitability and market value (Mello, 2019).

Today’s organizations must recognize human capital’s value by increasing training, development, and motivation investment. In the past ten years, there has been a significant increase in the amount of money organizations have invested in those factors (Mello, 2019). However, the primary focus of many HR departments is still on recruiting talent to fill their roles. Organizations need not solely focus on recruiting talent to fill their role. Companies can also utilize the adeptness and experiences of current employees by investing in employee development (Mello, 2019). Specifically, individuals stay with an organization for more extended periods if that organization has a well-designed performance management system that provides a precise, clear career path to follow.

Jeffrey A. Mello (2019). Strategic Human Resource Management (5).: Cengage Learning.