Friday 9 January 2009

HR is Strategy


   As a long-time fan of strategy+business, I've been reading some of Booz & Co's free ebook, Capturing the People Advantage: thought leaders on human capital (hat tip to Gautam Ghosh).

And having just posted on Gary Hamel's latest thinking, I was particularly interested to see the article by Hamel's previous co-author, CK Prahalad, which comes to some fairly similar conclusions as Hamel.

Given Prahalad's background, and current focus on the bottom of the pyramid, it's understandable that he focuses heavily on India in the article, and in particular, its IT and consulting companies, but there are still plenty of good, more general points in the article as well.  And I presume this is a republication of an earlier article, so it's no reflection on him that he supports his claim that the unique advantage today is human capital by noting that "there is a lot of money floating round", which as we all know, there just ain't currently (at least he didn't include a glowing case study of Satyam!).

Prahalad also talks about purpose and human capital and adds social capital to this as well (OK, not using all of these words, but this is what he's talking about):


"The first task is to build an intellectual agenda.  It must be at least intellectually challenging, and appeal to your emotions, either to your nationalistic identify or to your sense of what is good for humanity."

Human capital:

"Resources can no longer be contained within the firm.  So resources - talent or materials - must be available globally.  Second, access, not ownership, is important.  That means you may not directly employ any of this talent."

Social capital:

"The capacity to work together towards common tasks on a programmatic basis.  Business consultants know this instinctively.  You don't assign people to the same job; every consulting project gets a different team.  The real issue is, How do you pick the right people for a specific project?  How do you integrate into the team rapidly so that the frictional losses in becoming and operating as a team are low?"


Outside India, Prahalad says that are not that many companies he knows that have elevated HR to a strategic role.  Have you truly managed to in your organisation, and if not, what are you doing with purpose, human and social capital to enable this?



  • Consulting - Research - Speaking  - Training -  Writing
  • Strategy  -  Talent  -  Engagement  -  Change and OD
  • Contact  me to  create more  value for  your business
  • jon  [dot] ingham [at] strategic [dash] hcm [dot] com



Post a Comment

Please add your comment here (email me your comments if you have trouble and I will put them up for you)