MAXIMIZING ROI IN KNOWLEDGE AND HUMAN CAPITAL - PowerPoint PPT Presentation


Title: MAXIMIZING ROI IN KNOWLEDGE AND HUMAN CAPITAL


1
MAXIMIZING ROI IN KNOWLEDGE AND HUMAN CAPITAL
Dr. Alan Burton-JonesBurton-Jones Associates
2
21st CENTURY HUMAN CAPITAL
3
HUMAN CAPITAL
  • Definition
  • An investment of human resources with
    expectations of future returns e.g. a worker may
    invest part of his/her wages on a course of study
    rather than consume it on entertainment
  • History
  • 18th century Adam Smith early 20th Century
    Arthur Pigou 1950s-60s the Chicago School
    Mincer, Schultz, Becker 1970s-2000s economists
    and management theorists e.g. Bell, Drucker,
    Reich
  • Macro-economic and institutional perspectives
  • Traditional view (e.g. Becker 1964) Human
    capital at the macro /national level. Focus on
    theorizing the relationship between education and
    economic growth
  • Later theories Human capital at the level of
    the institution or firm.
  • Differences between human capital and traditional
    forms of capital
  • Inalienable can only be owned by the
    individual, not an employer
  • Non fungible individuals are unique
  • May deteriorate with age but use increases
    rather than depletes its value
  • Only contributes to production when actively
    applied

4
KNOWLEDGE HUMAN CAPITAL IN ORGANIZATIONS
  • Knowledge-based perspective
  • Firm as an integrator of disparate knowledge
    resources
  • Managements role control and coordination of
    integration processes
  • Key activities knowledge acquisition,
    transfer, application
  • Focus group and organization
  • Human capital perspective
  • Firm as an investor in disparate human resources
  • Managements role maximizing returns from
    people
  • Key activities human capital development
  • Focus individual, group, organization


5
COMBINING KNOWLEDGE AND HUMAN CAPITAL PERSPECTIVES
  • Need for effective strategies and techniques in
    three key areas
  • Linking people to performance
  • Managing dependencies between human capital and
    other resources
  • Managing organizational knowledge

6
LINKING PEOPLE TO PERFORMANCE
  • Accounting for human capital
  • 1960s 1990s Human asset accounting human
    resource costing and accounting human worth
    accounting
  • 1990s -2000s Human competencies accounted for
    as part of intellectual capital statements.
  • Limitations of accounting approaches
  • Non comparability- lack of common accounting
    standards for HC accounting
  • Reliance on proxy measures e.g. training, access
    to technology
  • Human capital depends on human knowledge which
    being transient and tacit is difficult to observe
    and measure other than through performance

7
MANAGING HUMAN CAPITAL INTERDEPENDENCIES
No man is an Iland, intire of itselfe every man
is a peece of the Continent, a part of the
maine (John Donne, 1572-1631 MEDITATION
XVII.) The knowledge economy is above all a
relational economy. (Janine Nahapiet,
2009.) Human capital is about being smart,
social capital is about being well connected.
(Anonymous.)
8
MANAGING KNOWLEDGE IN ORGANIZATIONS
Rational' planning and decision making
Formal learning
Gut feel, intuition,
Probing, sense-making, imagining
9
TOWARDS AN INTEGRATED MANAGEMENT FRAMEWORK
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MAXIMIZING ROI IN KNOWLEDGE AND HUMAN CAPITAL

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MAXIMIZING ROI IN KNOWLEDGE AND HUMAN CAPITAL Dr. Alan Burton-Jones Burton-Jones & Associates 21st CENTURY HUMAN CAPITAL Definition An investment of human resources ... – PowerPoint PPT presentation

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Title: MAXIMIZING ROI IN KNOWLEDGE AND HUMAN CAPITAL


1
MAXIMIZING ROI IN KNOWLEDGE AND HUMAN CAPITAL
Dr. Alan Burton-JonesBurton-Jones Associates
2
21st CENTURY HUMAN CAPITAL
3
HUMAN CAPITAL
  • Definition
  • An investment of human resources with
    expectations of future returns e.g. a worker may
    invest part of his/her wages on a course of study
    rather than consume it on entertainment
  • History
  • 18th century Adam Smith early 20th Century
    Arthur Pigou 1950s-60s the Chicago School
    Mincer, Schultz, Becker 1970s-2000s economists
    and management theorists e.g. Bell, Drucker,
    Reich
  • Macro-economic and institutional perspectives
  • Traditional view (e.g. Becker 1964) Human
    capital at the macro /national level. Focus on
    theorizing the relationship between education and
    economic growth
  • Later theories Human capital at the level of
    the institution or firm.
  • Differences between human capital and traditional
    forms of capital
  • Inalienable can only be owned by the
    individual, not an employer
  • Non fungible individuals are unique
  • May deteriorate with age but use increases
    rather than depletes its value
  • Only contributes to production when actively
    applied

4
KNOWLEDGE HUMAN CAPITAL IN ORGANIZATIONS
  • Knowledge-based perspective
  • Firm as an integrator of disparate knowledge
    resources
  • Managements role control and coordination of
    integration processes
  • Key activities knowledge acquisition,
    transfer, application
  • Focus group and organization
  • Human capital perspective
  • Firm as an investor in disparate human resources
  • Managements role maximizing returns from
    people
  • Key activities human capital development
  • Focus individual, group, organization


5
COMBINING KNOWLEDGE AND HUMAN CAPITAL PERSPECTIVES
  • Need for effective strategies and techniques in
    three key areas
  • Linking people to performance
  • Managing dependencies between human capital and
    other resources
  • Managing organizational knowledge

6
LINKING PEOPLE TO PERFORMANCE
  • Accounting for human capital
  • 1960s 1990s Human asset accounting human
    resource costing and accounting human worth
    accounting
  • 1990s -2000s Human competencies accounted for
    as part of intellectual capital statements.
  • Limitations of accounting approaches
  • Non comparability- lack of common accounting
    standards for HC accounting
  • Reliance on proxy measures e.g. training, access
    to technology
  • Human capital depends on human knowledge which
    being transient and tacit is difficult to observe
    and measure other than through performance

7
MANAGING HUMAN CAPITAL INTERDEPENDENCIES
No man is an Iland, intire of itselfe every man
is a peece of the Continent, a part of the
maine (John Donne, 1572-1631 MEDITATION
XVII.) The knowledge economy is above all a
relational economy. (Janine Nahapiet,
2009.) Human capital is about being smart,
social capital is about being well connected.
(Anonymous.)
8
MANAGING KNOWLEDGE IN ORGANIZATIONS
Rational' planning and decision making
Formal learning
Gut feel, intuition,
Probing, sense-making, imagining
9
TOWARDS AN INTEGRATED MANAGEMENT FRAMEWORK
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