Human Capital is the New Key to HR Leadership

Human Resource leadership and management

Human Capital and Talent Management have emerged as the ‘new black’ for Human Resources leadership. For the HR professional, staying ahead of trends is key to leading change and survival in today’s rapidly changing landscape.

Most CEO’s and CHRO’s agree that Human Capital is a key priority, however it is generally regarded as a long-term need that is important, but not urgent. For the CEO, it means: ‘I have ticked the box, but now HR can deal with it.’

Therefore, a big challenge for HR leadership is to make Human Capital and Talent Management an urgent priority for today.

Keys to Leadership Through Human Capital Management


1. Embracing the New


Talent Analytics – the New Norm in HCM

Talent analytics is quickly becoming the foundation of all talent management initiatives. By using talent analytics, talent management trends are implemented efficiently, making speed more important than ever.

People Analytics determine the characteristics of the best-performing people and teams. These findings can be used effectively for people and team development, as well as recruitment.

AI – a Threat or a Way that brings HR Leadership to ‘The Big Table.’

Artificial Intelligence in the future workplace

AI is poised and ready to take HR by storm. It is already adding value to organisations using it to streamline activities and improve the candidate experience. It could also be key to stamping out unconscious bias from the HR process.

What are the Potential Uses?

AI can transform the current one-way communications from HR to employees. Companies are using AI to:

  • Categorize employee feedback into areas such as compensation, work/life balance or benefits, giving HR teams key insights to integrate into future strategy.
  • Measure engagement, social connection and emotion.
  • Drive better decision-making through smart assistants, allowing managers in direct communication to address concerns faster.
  • Enhance employee experiences through increased employee intimacy.

It cannot be avoided that AI initially brings a level of disruption to the HR sector, however with the right team in place, managers can take full advantage of the way AI is revolutionising Human Capital.

2. Five Key Trends for Valuing Human Capital

Individual approach

The most important trend in HR is individualisation, where employees expect the type of individual experience they have as consumers.

Performance Consulting

Good people want to become better. Performance consulting does this by offering regular and detailed feedback based on real performance, rather than the standard annual review.

Increased Team Focus

Many HR practices are still focused on individuals, yet teams and networks of teams are the major building blocks in most organisations.


According to recent statistics, only 13% of the global workforce is engaged in their work. Engaged workers:

  • Yield higher results
  • Contribute directly to higher productivity
  • Are more innovative

This means employees should have positive work experiences! People like to share experiences at work and the better that these are, the better it is for workplace branding.

Team Productivity and engagement, HR Management


Traditionally capacity problems have been solved by recruiting new people. The problems created with this approach are:

  1. Difficulty in applying selection criteria leading to compromise on quality
  2. Productivity drops

By switching focus to productivity HR can hire fewer people (cost-saving) and instead focus on developing the potential of each current employee.

3. Eliminating Outdated Human Capital Measures

Old HR measures such as headcount, compensation/benefit cost, ‘time-to-fill’ and turnover no longer cut it in this new world of accountability. These measures simply don’t go far enough anymore to create shareholder value and align people decisions with corporate objectives.

Real leadership requires putting hard science around issues that have traditionally been difficult to quantify, such as, why people leave the company or better job engagement.

Human Capital metrics can help predict employee patterns in behaviour as well as future human capital investment demands.

The focus on overall efficiency, lean operating costs and significant returns on investment is now expected of HR.

4. The link between Human Capital and company success

The Human Capital Idea centres on these two Central Principles:

  1. People are assets whose value can be enhanced through investment.
  2. Human Capital should be designed, implemented and assessed by how well it helps the company achieve strategic results and pursue its mission.
Human Capital productivity is in fact associated with share price gains of between 3%-10% across all industry sectors using Human Capital metrics. Click To Tweet

As an example of the link between HCM and company success, extensive research over 16 years has shown gains across all industry sectors of the 10% in Human Capital, with productivity associated with share price gains of between 3%-10%.

Now is the perfect time for HR professionals to seize this opportunity and take a leadership role as Human Capital Champions, a role that, executed with excellence will lead them to a seat at ‘The Big Table’.

Your Career in Human Resources

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