Human Capital Management- True Value of a Workforce
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What is HCM?
A company’s workforce helps it earn money but there is also an incurring cost to the company. Human Capital Management or HCM refers to a company’s ability to maximize the value of its workforce at a minimal cost. The ability to create wealth for any organization depends upon the value of human resources contribution for any productive work in regards to sellable products and services.
Components of Human Capital Management
Employees are the lifelines of any organization. It runs with the help of people who contribute in its success and productivity. A large part of an employee’s life is spent in office, striving to achieve goals and objectives prescribed by the company. Employees should be regularly motivated so that they develop a sense of loyalty and attachment towards the company. Also, it translates into good performance at work.
Over a period of time, the skills and competencies of any person are developed and accumulated as capital by means of education, training, development and employment in a specific field. Increase in human capital increases the productivity and performance of human resources, and thus increases the growth in employability, remuneration and employment itself.
The major components of HRM are:
• Talent management- Ensuring HRM maintains the quality and integrity of the company through it’s staff.
• Payroll services- Ensuring all monetary compensation packages are in conjunction with financial laws.
• Human resource management- Over-seeing the HRM strategies and initiatives
• Attendance- Being aware of attendance and time related issues of employees.
• Benefits administration- Ensuring all benefit schemes and programs are aligned with company policy and within legal frameworks
Differences between HRM and HCM
Human Capital Management differs from Human resource management in as much as it relates to all employees’ issues in a broad spectrum, including employment, utilization, compensation and development. HRM is more limited in it’s aims and approaches, and deals with issues at a more individualistic level.
HCM works at the management level and provides data and initiatives to be incorporated into company procedure. It stresses on activities to measure various human capital assets. It plays the crucial role of attesting the financial value to human resource practices in qualitative terms.
Human Capital Management service providers
There are specific HCM providing companies that can add value to the existing set-up in companies and organizations. Some of the services they provide are:
• Streamlining the company’s existing HCM system
• Ensuring compliance with Health Care Reform requirements.
• Simplify administrative processes and manage human resource management overheads through automation and outsourcing.
• Work out a plan of action to connect workforce goals with corporate goals.
• Incorporating latest software and technology that help in re-instating programs and policies so that HR and other departments work better.
The main objective of any company should be to train it employees so that they become efficient resources in the present and indispensable resources in the future working at their optimum levels. Thus the well being of any company and the country at large, as well its systematic development and management depends upon its Human Capital Management practices.
Employers Resource helps every business at all stages with growth and development. Find out more! Call us today at (800) 559-2350.
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