This chapter and the previous two have described the importance of aligning human capital strategy with business strategy. They also have provided empirical tools for uncovering the facts about the existing workforce and measuring the impact of people-oriented practices on business results. These tools represent a new science for building and managing human capital.
You can put this new science to work for the benefit of your company by taking the following steps. In reality, the process of building a human capital strategy through these steps is
Know where you are.
Use ILM analysis and qualitative data to ascertain the facts about the current workforce and workforce management practices. Ask such questions as: What are our workforce capabilities? Are we building or buying them primarily? What are our special areas of strength and weakness? What are we actually
Project the future. Use interviews, surveys, focus groups, structured planning meetings, and the like, to build a picture of where the organization should go. How will the business be different? What changes can be anticipated in technology, processes, and customers? What are the human capital implications of changes in strategy?
Find the value.
Use Business Impact Modeling to identify the human capital attributes and practices that are creating the greatest value for the enterprise. Where possible, test and validate the qualitative data that have been gathered from executives and unit
Close the gaps. Identify the most important differences between “is now” and “should be.” Test alternative solutions such as new combinations of practices and new workforce attributes to identify the ways of closing the gaps that are most likely to be successful. Protect and enhance the sources of value identified through Business Impact Modeling.
Design the interventions.
Design the specific features of changes that will be made in the workforce and ways to manage them. Use the models created by ILM analyses to simulate what-if scenarios to help identify which alternative solutions will be most
Implement with accountability.
Use metrics to focus implementation efforts. Metrics will
These steps can get an organization moving quickly toward the development and implementation of a human capital strategy. Resistance and skepticism will be reduced because the strategy will be based on facts specific to the business. Targets can be set that are demonstrably realistic and specific. The dreaded “initiative of the month” syndrome is avoided because clear estimates of return on investment can be made to show why changes are being implemented. Trust in leadership grows because the facts behind strategic decisions can be communicated clearly. Line managers and
In Part III of this book you will see how the principles and tools set forth in this section can be applied to important business issues that many companies now face.