“We recruit for attitude and train for skill.” Atul Gawande
Once you start growing a business, beyond a one man (or woman) act, your human capital should grow along with it. While you may be the one catching the wave, your human capital is the surfboard that will let you ride it out.
Shared Philosophies Bridge the Gap
When a company is launched from ground zero, it is always based on the founder’s philosophy. When you are ready to recruit and hire employees make sure they share it. Being on the same page with your employees from the start will make optimizing your company’s human capital much easier in the long run.
For instance, an employee that shares your business philosophy will be more likely to see what he or she brings to the table in order to achieve the company’s broader goals. This type of employee will want to get all the training they can to be ready for what is ahead.
The Importance of Human Capital
To keep human capital (i.e., the quality of labor, economic value of an employee’s skill set, education, experience and abilities) at an optimum level it is important to ensure that employees do not stagnate. This simply means making sure your employees have the opportunity to evolve and transition with the demands of their position, or the position and roles they can occupy in the future.
Offering your employees on-site courses, symposiums, training sessions as well as literature on the industry-related topics is as much in their interest as it is in yours. The better trained and educated your employees are, the higher the value of your human capital.
The Financial Factor of Human Capital Improvements
At first sight it may seem like improvements in human capital will cost more than it is worth, but take a closer, look. In the long run human capital investments can actually save your company money.
Not only will human error potential be reduced by equipping well trained employees, your workplace productivity can increase as well. As writer Tina Amo wrote in the Houston Chronicle, “Your employees can contribute to the success of your company when they are trained to perform their jobs according to industry standards… Some companies consider in-depth training an unnecessary expense and expect new employees to learn on the job from supervisors and older employees. However, this type of training is often inadequate and creates problems for the business.”
Some may argue that an employee who has the correct tools to excel at their job will also be happier than a person that doesn’t. Meanwhile, happy employees are more likely to remain loyal to you and the company. On the other hand, unhappy employees will likely leave, which increases turnover rates and human resources costs. Training a new employee can cost tenfold what it would cost to send a veteran employee to training sessions and courses.
Improve Human Capital by Seeking out Good Leadership
One of the best ways to make human capital improvements is to seek out good leaders. As your company grows you will learn to appreciate those with leadership abilities, especially when delegation is necessary.
Many business owners may ask, “Who’s going to get the job done the way I would?” This is the first step to filling gaps that exist within your staff. Next, you can fill emerging leadership positions and improve your company’s human capital in two ways:
- Accept new applications. You can accept new applications for positions. By hiring from the outside, you may find employees with a great track record and high recommendations. Sporadically bringing in “new blood” is a very good idea. The addition of new and fresh thinking can enhance company procedures and lead to positive changes.
- Promote from within. In this case, you can evaluate which of your employees has what it takes, based on firsthand experience, to get the job done. De-facto: You know what you’re getting into! Meanwhile, promoting from within shows employees that there is room for career growth.
As you can see creating valuable human capital does not have to be difficult, and yet it can be very rewarding. Sharing a philosophy with your employees is the cornerstone for a solid company culture. A foundation formed by a highly motivated, trained and loyal team of employees. Together you are on your way!
Arlene Chandler used her time working for a real estate firm in Seattle wisely; learning HR tactics that she continues to hone and cultivate to be the best she can be in her field. She shares her knowledge writing for Suncorp, a leading income protection insurance provider in Australia.