Some Practical Advice

Once human capital becomes an essential part of strategic decisions, two good things happen:

1. Strategic options become more realistic.

2. The organization will be better prepared for changes in the competitive environment.

Thus, if you are contemplating a shift in strategy or if the competitive environment is changing around you, get the facts. Uncover the facts about your human assets and practices and you’ll view the situation with new eyes. The facts may cause you to view human capital as a constraint on the business strategies you can pursue realistically, for example, how fast you can grow, which geographic area you can operate in successfully, and what you can offer customers. A fact-based view of internal human capital also may suggest strategies for which the organization is exceptionally prepared: people-driven strategies that differentiate the firm and give it a clear competitive advantage.