Fundamentals of Level Three Leadership

136. Human Capital

Concept

Human Capital is the imaginary sum of what all of your employees can do. A stack of resumes is a poor approximation of an organization’s human capital; note that an MBA is not an MBA is not an MBA. As you can imagine, it’s difficult to measure a person’s abilities much less add those together with others’. Hence, it’s an intangible asset pool.

Example

Supposing you own a title company, which reviews and clears real estate titles for transfer to a buyer. After a couple of months, you could record how many titles your 30 employees could clear. Adding those up, you would have a rough estimate of the value of your human capital pool.

Diagram

Challenge

1. How many humans are in your organization?

2. What kinds of human ...