An organization's human resources are its most important assets. They define an organization and affect its
capacity to perform. HCM is an approach to people management that
treats people management as an important strategic issue and seeks to
analyze, measure and evaluate how people, policies and practices create
value. It focuses on people's capability as a source of human capital and
organizational transformation. HCM is a business discipline that
ensures the effective management of human capital strategies and portfolios.
It combines business and workforce intelligence to provide
decision support for the development of enterprise human capital
strategies that aim at leveraging people and their ideas to achieve the
business goals of growth, increase in market share and margins and
decreasing selling, general and administrative costs. As such, human capital
management is not the same as human resource management.
Formulating the strategies for growth is one of the most
important functions of leadership. Growth involves human capital
decisions. Growth strategy may entail either organic growth or an
acquisitions strategy. Organic growth of a company through extending
new products, adding new products or entering new markets requires
human capital resources. HCM has a tremendous role to play in
mergers and acquisitions too. The post-merger integration is very
critical in mergers and acquisitions and HCM facilitates this.
Procter & Gamble (P&G) is an example of the role that
leadership plays in growth. AG Lafley, Chairman, President and Chief
Executive, P&G, has been credited with turning P&G around. The
ingredients for Lafley's success include a focus on innovation and building
the company's brands like Crest, Pampers and Tide. He has also laid
considerable emphasis on nurturing talent by instituting leadership
programs aimed at everyone from P&G's top 100 managers to
the company's new hires. Lafley notes, "our assets at P&G are our
people and our brands." |