Inhuman capital management

I work for a living. I like the work I do quite a lot, though like many (most?) people I suspect I would prefer to be professionally rich. However, some things about working for a living annoy me more than others. One of them is the language of business. Or rather, the attitudes that language signifies. Apparently I am ‘human capital’. So are you. Bad enough to be reduced to a statistic, as ‘personnel’, and still worse to be a ‘human resource’. But ‘human capital’? Exactly which chunk of machinery were they thinking of comparing me to?

Strangely enough, I have heard people suggest that referring to people as capital is better than calling them personnel or human resources, as it ensures that ‘the business’ appreciates their real value. Really? More likely it tells you exactly how mistaken we are to regard business as being part of society in any positive sense. They really do think we are just another resource to exploit for their profit.

So when it comes to the crunch – and speaking as someone who has been made redundant three times, I know just how appropriate that word is – it is quite clear what the priority is. It’s the money. That’s all. It makes you wonder about all that rhetoric about profit being a reward for risk-taking. Well, that’s what they used to tell me when I was studying economics. Since economists don’t seem to have much of a handle on how businesses really operate (and in my experience most business people have little grasp of economics), it’s as good a guess as any.

But when the risks explode in their faces, who exactly shoulders the burden? Who loses their job? Which comes first, profits or wages? Can you remember the last time obviously incompetent board members were sacked before a fair few workers and managers had been deprived of their livelihoods? Human capital indeed: maintain it well (enough) when it’s making you money; scrap it when it’s not.

But even in the good times I can’t say I’m impressed with the idea of ‘human capital’. If the phrase encourages business people to see the people the employ as valuable, it also encourages them to see them as things. Just look at any book or website about ‘human capital management’. In the new human capital management regime, people have been promoted from ‘costs’ to ‘assets’, but one has to ask, what is the new relationship to business this suggests? Costs are measured, controlled, minimised. Not a nice way to talk about human beings, I would have thought, but it’s still pretty tame compared with what you do to assets. Assets you exploit.

Yet it is such a stupid way to treat people. Because if there is one thing human beings are not, it’s capital. Which is just as well, because if they were capital, they would not have the kinds of ability every human being on Earth has, and no machine. Imagination. Creativity. Commitment. The ability to learn. Willingness to take on responsibility.

But is that how the human capital management movement regards human beings? Absolutely not. It’s all about binding your staff to business goals, designing the perfect process for them to fit into, evaluating their performance, measuring the ‘contribution’ to the bottom line. It’s about designing the perfect treadmill.

Which completely misses the point of human beings. In an advanced industrial society, can we really claim that we still need to treat human beings as ‘appendages to a machine’? At the same time, are businesses really so good at what practically every ‘business leader’ now says are the critical functions in business – innovation, creativity, agility, and so on – that they can afford to ignore the only ‘asset’ they have that is capable of any such thing – namely their own staff? What ‘process’ ever had a good idea? What computer ever thought up a better way to do things?

And what human being did not? It’s true that human beings are seldom at their best when at work. But then how many workplaces encourage (or even permit) the vast majority of workers (or even managers) to have any ideas of their own, let alone think outside the box? But look at the most ordinary individual outside of work, and an astonishing number of them are busy doing exactly what most of their employers despair of them doing in the factory or at the office. Having ideas. Taking responsibility. Making sure things get done. The world is awash with evidence that practically every single human being on the planet is capable of intelligence, insight, innovation. So why is there so little evidence of them in the workplace?

Perhaps the answer is that, when they get to the office or start up that machine, it is the very nature of the organisation that makes it impossible. Outside they are people. Inside they are assets.

Is this the necessary price of basing an economic system on profit? Not really. Maximising profitability requires businesses to get out the most their staff. But that does not mean that they have to believe that this is best done by treating people like machines.

And the first thing that needs to change is that ‘human capital management’ label. I don’t know a better one, but perhaps that’s because people don’t need a label. Maybe we should just call them people. Maybe we should actively encourage those little eccentricities that make people so different from any kind of capital. Like their capacity to look at what they are doing and work out how to do it better. Like wanting to do it better, just because it is better. Like lateral thinking – or thinking of any kind! But of course, they are never asked. Just do your job.

People really are our greatest asset. But they won’t reveal their greatness until we recognise that they aren’t ‘assets’ at all.

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