Learn the essential elements for good Human Capital Management in organizations

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In every organization, the human team that makes it up has always been considered one of the fundamental factors for achieving business success.

For this reason, human capital management is increasingly applied in the business world with the intention of seeking the effective development of its employees , through strategic practices and processes.

What is the connection between Human some of the key features of band Capital Management and Human Resources Management?
What is human capital management in organizations?
What are the objectives of good human capital management?
What are the advantages of Human Capital Management?
What are the processes related to Human Capital?
5 pillars of effective human capital management
How to accurately measure the quality of this management?
What is the connection between Human Capital Management and Human Resources Management?
Due to the social and technological advances observed in recent years, companies have needed to optimize different areas of management in order to:

improve your performance ;
achieve good results ;
meet the needs of its customers with maximum efficiency and agility.
Among the many strategies, investing in the development, motivation and productivity of employees has been one of the most satisfying and profitable options.

In fact, until recently, the HR area's approach was restricted to hiring, firing and controlling employee benefits. For this reason, it was known for having a mechanistic approach.

However, starting in the 1980s, companies began to take a new path, understanding that achieving better results is closely related to the company's care of its staff.

This closer look at the needs and perspectives of employees has caused the Human Resources sector to position itself as the main entity responsible for the transformation of the work environment .

In this way, human capital came to be considered the main concern of organizations and, currently, it is classified as the greatest asset of a company. But, ultimately, what is the relationship between Human Resources Management and Human Capital Management?

While Human Resources Management focuses its efforts on developing a macro strategy, thereby creating a bridge between the company and its professionals, Human Capital Management has as its main challenge developing the skills of employees, thereby creating their commitment and maintaining a good work environment.

Indeed, the difference between these areas lies in their processes and their responsibilities in relation to corporate routines . In essence, both types of management have essential roles in organizations.

For example, while human capital management identifies a professional's weakness, human resource management develops a strategy for their development and performance improvement.

Therefore, for the company to be on the path to success, it is essential that these areas work as a team, align their strategies and complement each other.

What is human capital management in organizations?
When a company's organizational structure works successfully, it is mainly due to the effective management of its work team.

Over time, more and more tools are being developed and applied so that the Human Resources unit can better analyze the data of the profiles that apply for a job.

This means that corporate leaders are increasingly focusing on how they manage their human capital, providing them with more specific skills, focused on achieving objectives and developing a good organizational climate .

What are the objectives of good human capital management?
There are some key objectives that must be taken into account to achieve good human capital management.

help the organization achieve objectives ;
identify needs in the human team and manage possible improvements;
Maintain the quality of its employees by improving their skills and training stages;
deepen moral values, a sense of belonging, a spirit of teamwork and a focus on achieving common goals.
Human capital management is essential to attract talent with the ability to demonstrate high performance, but in addition to this, they must try to carry out good management of orientation, training and retention .

What are the advantages of Human Capital Management?
Indeed, if you want to have motivated and productive employees, you need to actively invest in their development . But, after all, why is it so important to pay attention to the human component? Is this also your question? Don't worry, keep reading! Below, you will find 5 killer advantages of implementing excellent human capital management in your business .

1. Optimize internal communication
Indeed, implementing excellent human capital management enables a greater flow of data and information throughout the organization.

For this to happen, the organization must be willing to invest in instances that make it possible to detect failures in the communication process such as noise, verify which professionals have more difficulty communicating and undertake strategies to help them develop this weak point. As a result, much more efficient communication can be developed.

2. Increases employee satisfaction
By carrying out actions that promote the development of human capital, it is possible to increase the level of satisfaction of people, mainly because they stimulate the feeling of belonging to a group and of being important in achieving its objectives.

3. Increase productivity
When professionals are trained to carry out their activities, they tend to do so with more assertiveness and agility, a situation that leads to improved time management, thus promoting a drastic optimization of productivity.

4. Improves the corporate image for the client
This advantage goes hand in hand with the previous one, since by increasing the productivity of employees and encouraging their motivation, teams dedicated to customer service tend to interact more cordially and carry out their activities more efficiently.

Remember, customer service employees represent the company to the customer, so it's essential to ensure that they have an excellent experience.

5. Increase ROI
It is a fact that, when hiring staff, you are investing in the company's human capital, however, it is not enough to pay them a salary and benefits.

In order to dedicate themselves to their work, employees must feel important and understand that their efforts are being recognized by their managers. Some of the most effective ways to demonstrate that the company is truly committed to its teams are:

conduct courses and training;
offer opportunities for professional growth;
provide additional bonuses and financial incentives.
In this way, people feel valued, thus increasing their productivity and motivation to carry out activities. As a result, the company manages to increase its income and optimize its return on investment.

As you can see, it is very important to pay attention to this area of ​​the company, since it contributes to improving the organizational climate, optimizing processes and increasing profitability.

What are the processes related to Human Capital?
To properly manage human capital, it is essential to develop actions that enable the growth not only of organizations, but also of professionals in the strategic, tactical and operational spheres.

Indeed, the processes inherent to human capital contribute significantly to the fulfillment of internal goals and objectives, in the same way that, in the external sphere, they make it possible to optimize the company's positioning in local, regional and global markets.

Below, learn about them and understand how the success of this management is related to the effective implementation of each of the processes:

Basics
First, the job positions are verified and then the human resources plan is created.

Of affectation
Ultimately, the activities seek to incorporate individuals into the company through recruitment, selection and hiring.

Development and training
The purpose of these processes is to improve professional training and, in this way, guide employees in carrying out their work in accordance with corporate challenges.

Maintenance
Maintenance actions are intended to improve the performance of professionals and contribute to a better quality of life.

Subtractives
Includes both voluntary and company-imposed dismissal activities.

On compensation and evaluation
These processes monitor and record employee performance, as well as promote compensation actions based on said performance.

As you can see, human capital management seeks to align itself with business objectives, taking into account the demands of people in the corporate universe.

5 pillars of effective human capital management
For human capital management to be effective, it is necessary to focus on providing the work team with specific skills as appropriate.

These skills should include:

1. Legal requirements
One of the fundamental pillars in human capital management is the proper handling and application of labor laws. Being governed by the legally established provisions will help maintain an appropriate and linear relationship with employees.

2. Employee Commitment
The more satisfied employees are, the greater their commitment to the company, sense of responsibility , and discretionary efforts at work.

Another of the fundamental pillars in human capital management is precisely to generate that empathy with the work team, which is achieved with actions such as:

incorporate contests and competitions for prizes;
promote performance recognition incentives;
reinforce positive attitudes;
and listen to employees to help them solve problems.
3. Vocational training programs
Investing in staff is a fundamental task that every company must always take into account.

Professional development of the workforce through training programs and career plans helps keep employees involved and committed to work, while progressing personally and professionally.

Some ways to create training programs include:

the rotation of positions within the company;
workshops and tutorials;
internal and external training;
and strengthening internal communications .
4. Corporate image
The Human Resources team of an organization is the main institutional actor that must promote and defend the company's image .

Part of what makes Human Capital Management effective is constantly reinforcing the institution's vision, mission and values.

In this sense, it is necessary to put your greatest effort into how to reflect the brand's objectives, and in these times of digital changes, focus on reflecting the company's culture through social networks and Branding campaigns .

5. Management software
An efficient formula for measuring the quality of Human Capital Management that a company applies is the use of software that helps to comprehensively process all employee data through a single platform.

This type of software that can be easily installed can be used to:

complete job application forms;
recruitment management and monitoring of potential candidates;
digital archive of job profiles, performance history and evaluation program;
digital payroll calculation system, tax deductions and employee benefits;
internal newsletter with easy access and scheduling of events of interest to employees.
How to accurately measure the quality of this management?
Key performance indicators, also known as KPIs , are ideal metrics that companies can apply to measure the performance of the processes they carry out, in this case, Human Capital Management.

These KPIs must be tangible and meet a specific objective. They must also be measurable, accessible, and provide relevant results.

To measure the quality of Human Capital Management, the following could be taken into account:

1. Employee retention
A good indicator of job stability within a company is the ability to retain staff.

The fact that there is little turnover in the work team and that people decide to keep their jobs not only shows that the employee is happy with their job, but also other factors, such as satisfaction with the remuneration they receive or the organizational climate.

2. Time spent on recruiting
Losing a talent in the workplace will always require investing time and money in recruiting a new employee.

The average time it takes to manage a new hire is measured from when an employee resigns or is fired until his or her replacement is selected.

This process can be optimized over time, but it is advisable to have an updated database of potential new candidates.

3. Training and education
Courses and training in which employees participate to improve their attitudes and work tools could also help improve productivity levels in the company.

It is a strategy that generates gratitude on the part of employees, reinforces their levels of institutional commitment and therefore their satisfaction with the work they do in the company.

Conclusion
Human Capital Management plays an essential role in any organization that seeks to have a good organizational climate, increase productivity and keep its talents happy to ensure their good performance.

If you found this article interesting and want to expand your knowledge, our post on organizational culture will surely be of great use to you.