Human Capital Management (HCM) flips what we know as administrative functions of the usual human resources (HR) departments, which includes recruiting, training, payroll, compensation, and performance management and turns them into opportunities to drive engagement, productivity, and business value. In Human Capital Management the workforce is more than the usual cost of running a business, it is the center asset in which success is built. Just as with an asset in a business it requires strategy.
What is Human Capital Management
Breaking down HCM
Human capital management provides a process for optimizing the performance and efficiency of the staff within a company. Therefore providing an overall game plan to guide talent attraction, recruitment, onboarding, employee training and development, performance appraisal and feedback. The term HCM can refer both to a business strategy and a set of modern IT applications, Though sometimes used interchangeably, the terms related HR, HRMS, and HRIS do have subtle examples
HR: Human resources (HR) is the division of a business that is charged with finding, screening, recruiting, and training job applicants, as well as administering employee-benefit programs
Talent management: Talent management refers to the anticipation of required human capital for an organization and the planning to meet those needs
Workforce rewards: an incentive plan to reinforce the desirable behavior of workers or employers and in return for their service to the organization. … The primary objective of organizations in giving rewards is to attract, maintain and retain efficient, high performing and motivated employees.
Workforce management: (WFM) is an integrated set of processes that a company uses to optimize the productivity of its employees. WFM involves effectively forecasting labor requirements and creating and managing staff schedules to accomplish a particular task on a day-to-day and hour-to-hour basis
HRMS: A human resources management system (HRMS) or human resources information system (HRIS) or human capital management (HCM) is a form of human resources (HR) software that combines a number of systems and processes to ensure the easy management of human resources, business processes, and data.
HRIS: an HRIS system is the integration of HR activities and information technology. It enables data entry, and tracking and management for human resources, payroll and accounting.
Ways to Manage Human Capital
1.Create employee profiles. Successfully managing employees in a workforce that is continuously growing is no easy feat, especially when employers can’t connect a name to a face.
2.Streamline employee onboarding.
3.Revive the performance review.
4.Offer unlimited PTO.
5.Embrace mobility in the workplace.
Five Elements of Human Capital
- Skills, Qualifications, and Education.
- Work Experience
- Social and Communication Skills.
- Habits and Personality Traits.
- Individual Fame and Brand Image.
Make it work for you
Human capital is an asset you can never physically touch or quality not listed on a company’s balance sheet. It can be filed as the economic worth of an employees experience and skills. This will include assets like education, training, intelligence, skills, health, and other things employers value such as loyalty and punctuality.