Thursday, 8 November 2007

The Talent Powered Organisation

I’ve just started this new book, written by Peter Cheese and colleagues at Accenture.

I’ll come back to the key points in this book again later, but I thought I would post now on Accenture’s, and my own, definitions of talent and human capital.

Peter Cheese’s definitions first:

Talent refers to the “total of all the experience, knowledge, skills and behaviours that a person has and brings to work”. It is therefore “an all-encompassing term to describe the human resources that organisations want to acquire, retain and develop in order to meet their business goals”.

Human capital “conveys a greater sense of the value attached to the employees of an organisation, and a wider sense of economic contribution than is inspired by the term ‘talent’ ”. It “tends to be used when we think about the strategic, economic and financial aspects of talent, particularly how human capital contribution could be permanently increased by investing in human development”.

Peter Cheese also notes that “ ‘Human capital has fallen out of favour in some quarters.” This is supported in Tech Republic responding a post ‘Why human capital is insulting’ yesterday.

As I said in these comments; for me at least, HCM is about managing people in a way that accumulates an intangible called human capital in order to drive competitive success (‘managing people for human capital’, not 'managing people as human capital').

(And I would argue that this is terminology, not jargon.)

Human capital’s link to economic and financial success is an important aspect of the concept, but I think we need to define it by what it is (an intangible capability) rather than what it provides (the basis for competitive, economic and financial success).

Talent, again for me, relates to people with specific and important skills or other attributes, and therefore relates to one or more sub-groups of the full employee population. Talent will therefore provide a sub-set of an organisation's full stock of human capital (but based upon the Pareto principle, my provide a substantial proportion of it).

When I get time, I will develop these points in my wiki but (whether or not you agree with me or Peter Cheese, or you have a perspective of your own) please do feel free to add your thoughts or other definitions there too.



For those of you in search of further information on talent vs human capital, I'd also recommend
Don Taylor's post on the subject.