David Creelman has recently conducted another insightful interview with Jac Fitz-enz, founder of the Saratoga Institute and now with Human Capital Source, about what he calls HCM: 21 (HCM for the 21st century).
The interview describes HCM: 21 as a four-step model for directing HR's actions:
1. "From the big picture to needed capabilities"
The process starts with what I've referred to as strategic workforce planning to identify capabilities (structural, relational and human capital) like the ability to attract talent.
I think this focus on organisational capabilities as the basis for all HR activities is absolutely right.
2. "Improving HR processes by using analytics"
Fitz-enz focuses on analytics and evidence-based management to guide the actions it will need to take, for example whether it needs to improve certain aspects of recruitment.
3. "Integrating actions across HR"
HR specialists all need to work together in a connected way.
I agree, and this is why in my book (I don't think I've posted on it in my blog) I talk about the need to identify strategic programmes which focus on the agreed organisational capabilities and link all HR processes and developments together within these programmes. A focus on outcomes rather than activities also helps.
4. "Better measurement"
Fitz-enz suggests we should focus on leading indicators like engagement, culture and readiness - all relating to intangibles.
"'That is where the game is today' he said, 'it's all about intangibles'. So for example, if retention were an issue the focus should be on leading indicators like engagement, not lagging indicators like how many people left last quarter."
Absolutely - see my Value Chain for details on doing this.
But will it work?
"Fitz-enz says: 'As always what I'm trying to do is just get the thinking going in a different direction.' To me [Creelman] that's the heart of the HCM 21 approach. For sophisticated HR departments it's a way to put a number of important ideas together into a defined process. For less sophisticated departments, environment scanning, capabilities, intellectual capital, analytics, and leading indicators will all be new ways of thinking that will challenge them to do things differently."
I agree with the need to get thinking going in a different direction, and think that HCM: 21 has a lot to say for itself, although I think it overdoes the focus on measurement.