Friday, January 11, 2008

Assessing Human Capital in the Entreprise

In these first days of the new year, I feel like I've started to climb an unfamiliar mountain. The path is narrow and looks unsafe, but the vista that is revealed to me as I make my way up, step by step, is gorgeous and full of nice surprises.
What is this mountain? It's the personal challenge that I've decided to meet to establish myself as an independent consultant in Collaboration and Social Network Analysis.

So, where am I on the journey?
As I am preparing to leave my current company at the end of the month, I've been contacting colleagues who are potentially interested in using the ONA approach in some of their client departments. So there is a (small) chance that this company becomes my first client. In addition, I am in contact with my former boss who is now at the head of an informatics group in a pharmaceutical company on the West Coast. Here again, there are active talks that could lead to positive outcomes.
These contacts are extremely valuable, whether they lead to work or not, as they prompt me to refine my offer and clarify the approach that I am offering to conduct Organizational Network Analyses.

ONA is one of the tools to assess Human Capital
Human Capital is the value creating potential of the entreprise. It relies on how the actors, who make the entreprise thrive, interact with one another while juggling with the following organizational constructs:

  • Values that enable constructive human interactions
    As a primary example, I would mention Strategic Thinking which helps determine the courses of actions that will help align everyone's efforts in a common direction. There is also the fundamental value of Respect for People which is a keystone of any human interaction. The third value is the promotion of knowledge sharing as an instrument of power, as opposed to knowledge retention, which is so widespread in many companies.
  • Obligations and Constraints
    Human Capital can often be hindered or inhibited by the set of internal constraints and duties that are grown off sheer organizational complexity. The first one comes from the hierarchical organization, that can sometimes be mixed with a dose of matrix reporting. Other self imposed constraints are the business objectives, which are necessary and a good thing when they directly support a well established and understood strategy., but can be translated into sets of unaligned individual goals. Another big constraint on organizations is the time sinks represented by rigid bureaucracy, including governance, corporate policies, meetings and email overload.
Faced with the organization's sluggishness and the values that give a framework of how to cope with its complexity, the Human Capital can be assessed by the responses of individuals and groups:
  • Their behaviours
    regarding how to do their day to day jobs, how they interact informally with one another (social networking), what time they can afford to spend on improving the way they do things (innovation) and how they develop themselves.
  • Rewards and recognition
    This is the feedback loop that can re-enforce or undermine any effort towards a more collaborative environment. What are the behaviours that are really rewarded? Is it global thinking, team focus, knowledge sharing and personal contribution to improve the level of cooperation, or is it exacerbated competition, hero mindset, power by information silos?
Organizational Network Analysis focuses on the collaborative behaviours within the entreprise. Its results have the potential to reveal the dynamic results of the set of obligations, constraints, values, rewards and recognition that form the culture of the entreprise. It will give clues about what could be changed to enhance people's contribution to the welfare of the entreprise, thus helping to improve Human Capital.

I will dive into how ONA's can be conducted as I take you along in my exciting journey up the mountain!

Link: A mind map of Human Capital Assessment

Photo: Jura (France) - August 2007 - Patrice Chollet