Companies like saying that employees are their most important asset. But it can seem hypocritical, especially in companies which lay off massive numbers of workers as a knee-jerk reaction to economic difficulties. The ongoing human capital discussion has, however, helped to change the view of staff as being a cost factor to seeing them as an asset. Now the onus is on HR units to verify this value contribution transparently while actively guiding their own activities and justifying capital requirements with well-substantiated figures.
Existing HR systems generally do a good job of capturing staff costs and the costs of the HR department. They generate the usual employee statistics and any number of HR performance indicators. However, the main obstacle to value-based HR management usually lies in the fact that there is an unclear understanding of the company's strategy and management approach. As is typical for central functions, challenges range
- from lacking prioritisation of targets and poor expectation management between HR and operational management,
- to unclear delimitation of governance and responsibilities between HR and on-site managers,
- to a lacking HR “controlling tradition” in the sense of existing data capturing processes and system support.