Have you progressed on measuring HCM?

first_img Previous Article Next Article Have you progressed on measuring HCM?On 29 Jun 2004 in Personnel Today Related posts:No related photos. Comments are closed. The Accounting for People Taskforce’s long-awaited report was published inNovember last year. It gave examples of how companies can report on humancapital to shareholders, but did not recommend exact measures. Instead, theresponsibility for devising best practice was given to businesses. This announcement was followed in May this year by draft regulations foroperating and financial reviews. They stated that by 2005, all listed companiesmust provide shareholders with an overview of their strategy and futureprospects, including some information about the company’s employees. Reporting on human capital is clearly on the agenda for listed companies andshareholders, but what is not obvious at this time is exactly how businessesshould be responding. Our joint research with Personnel Today in September 2002highlighted the need for a recognised framework by which companies can reportto their investors and enable investors to judge how one company differs fromanother. Although the Accounting for People Taskforce refrained from prescribing bestpractice, there is still a lack of clear guidance on establishing measurementand reporting methodology. There is a danger that human capital reporting willnot be consistent for some time, and that investors will not fully benefit fromdata. The most valuable information will be outcome-focused and directed atdemonstrating bottom line improvement. For example, resource allocation anddeployment will be made more efficient by tracking workforce trends by joblevel and location, years in position and retention. Productivity will beincreasingly important for corporates in a low-growth environment.Demonstrating how business is doing more with less will be significant. Businesses should be aiming to create and use data that will improvedecision making by providing the type of knowledge that enables leaders to runbusinesses better. This will help to identify ways to grow revenues, instead ofcutting costs. With Personnel Today, we are running our research again this summer to findout how far businesses have progressed. Although we expect to find improvement– some businesses will have made huge progress – it will be clear that othersstill have a long way to go. last_img read more