Written by : Gloat, The Internal Talent Marketplace.
A lot of companies out there are looking for the best methods to change or improve the skills of their people. This would be their immediate response to the obstruction brought by the COVID 19 pandemic to most sectors of the economy.
In connection to that, it is essential for them to grapple the less accurate metrics regarding the return and talent to humans’ capital investments. Having an adequate metric will improve the engagement of the stakeholder to the company and the employees at the same time.
Aside from that, it would also help them to create and monitor the decision-making happening in most companies. These processes would help the company to work efficiently.
Regarding the accounting systems present these days, most of the workforce investments have hit the overall earnings without recognizing the creation of value.
On the other hand, the favorable treatments and the core earnings are being received and exclusive only to the reductions. This could lead to possible incentives perverse. This would give the idea to the management to lessen the workforce investment and consider disposing of the treat talent.
- The creation of a new and improved framework regarding giving value to the human capital would be a great help to change this after the COVID-19 impact to most countries around the world.
- For the past years and up until now, when the company invests in the human force, they see it as detrimental to the company’s money without giving value to the efforts and time being given by their employees to achieve the main goals of the company.
- The companies these days don’t have enough metrics to measure the return on investment as well as the value of talent in the employees.
Human Capital as an Asset: An Accounting Framework to Reset the Value of Talent in the New World of Work was developed and published by the World Economic Forum that worked with Willis Towers Watson.
This paper will give ideas to most organizations to at least improve and enhance human capital accounting, which plays an important part to the Great Reset.
The publication created by the World Economic Forum and Willis Towers Watson has provided 7 guiding principles. These guiding principles will be considered as a guide for most organizations out there to reshape their idea about giving value to human capital.
The seven guiding principles are the following.
From Quarterly Turned into Generational
Considering that the value regarding the workforce investments of the company is being seen in the long run, according to the metrics, allotting more time to see the importance of the workforce is necessary.
This would help the company to decide whether to buy a talent or reshape the existing talent of the employees. The publication also recommends the companies out there to retrain their employees to improve their skills.
Broader and Forward-Looking Measures of Value
Aside from relying on yourself to evaluate the employees performance using traditional measures, it is still necessary to look at the potential measures that can be used to assess the workforce’s value in the future. Measures should be monitored regularly. This is important to enable most employees to have a sharper focus.
Consider workforce as an Asset
Rather than considering the human workforce as an expense, it would be great if companies will look at it as an asset. According to the publication, the capitalization of investments is important, and it should be taken to the balance sheet of assets.
Create Skills, Work, and People from Jobs and Employees
For the past years, employees are performing the work’s traditional notion. In connection to that, it is giving the employees a wider focus regarding their skills and work. Aside from that, it could also be a way to double the productivity of the employees at work.
Create Ecosystems from Stand-Alone
According to the experts, the successful establishments these days will see the need for a lot more participants, including the broader community, suppliers, and partners. The COVID 19 pandemic made bigger establishments to see the importance of building a stronger alliance and partnership between the two companies.
Forget About Corporate Policy and Turn it into Social Responsibility
Considering the increase to the focus regarding corporate social responsibility, it is expected that workers will see more values in the community and the workplace at the same time.
Forget about the Profits and Turn it into Purpose
Measuring the employees performances should not only focus on the returns of the shareholder. It should focus on the efforts and sacrifices of the organization to achieve its main goals to create equal value between the workers and the stakeholders.
The responsibility of the company to its talent is one of the important parts of stakeholder capitalism. These include the salaried employees as well as the contingent workers.
Seeing the value of the human force in one establishment is important. This not only brings more happiness to the employees but can make them feel even more valued.
The guiding principles presented above are according to the publication created by the joined force of the World Economic Forum and Willis Towers Watson. When these seven guiding principles are implemented to the company, this could lead to a big change.
Companies should not always value their stakeholders and other big individuals who run the establishment. They should also give value to the human workforce who plays the biggest part in achieving the company’s main goal.
Both the guiding principles and its framework would help the improved and enhanced decision-making process of the organization only if it will be integrated to the establishment properly.
Aside from that, proper integration of these two will also help the company manage its ROI in workforce capital. These all can be done while creating a resilient company and employee and, at the same time, equal relationship between the entire stakeholders.