Chapter 16

The Human Capital Index

Questions Answered
  • Do we have the right mix of skills and experiences to get our current work done well?
  • Do we have enough people with the right mix of competencies for our current needs?
  • Do we have the right numbers of people in each job category and business unit?
  • Are we hiring the right people?
  • What human capital gaps should be filled via hiring versus developing our existing people?
  • Am I overstaffed for some competencies and understaffed for others?
  • Are we developing the right knowledge and skills in our staff?
  • Do we have a good succession plan for replacing our key leaders and technical professionals?
Why Is This Information Important?
Many organizations today place a much higher value on their human assets or employees than they do on physical assets like real estate, equipment, and even patents. In fact, companies like Microsoft believe that 80 percent of their value is in their people. Having the right people is often critical to an organization’s success, yet most organizations have poorly designed metrics to keep track of their human capital. What is so ironic about this is that every single manager can identify the most valuable individual on her staff. She can also identify the person whom she would not be devastated to lose. Almost never do these subjective assessments match up with the human capital scores given to individuals by human resources. In other words, some of the least valuable ...

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