Human capital management - Matching timing and talent

Bert van der Zwan, VP EMEA, WebEx

Achieving the most productive combination of workers and work is vital to gain competitive advantage

Across the business landscape, executives are currently facing a similar problem: as part of a large corporation, you may oversee, say ten regional VPs, or managers and must assign them effectively across the enterprise. You know that the correct management of small differences in their preferences and skills can make a marked difference in their productivity. What's also clear is that the effective assignment of person to task, continues down the chain of command - making a significant affect on your company's earnings.

The Human-capital imperative
For decades, managers have struggled with the challenge of organising personnel in the most effective way possible. Value is now created by workforce innovation and more sophisticated people management. However, these productivity gains have become progressively obstructed by the growing cost and complexity of managing the workforce.

In the United States, for example, the service sector's share of employment has grown from less than half of the economy in the 1950s to more than seventy per cent today. Labour costs are the single largest component of US business expenses: in 2000 they represented forty four per cent of GDP. As the proportion of information workers in the overall workforce has risen, from one third of workers in the 1930s to over two thirds today, so too have the interaction costs required to conduct business. The cost per interaction might have fallen sharply thanks to technology, but the number of interactions has grown still more. In 2002, 31bn emails were sent worldwide, a figure that, according to analyst IDC, could double by 2006. With email becoming such a burden on business, a real need has grown for sophisticated tools to coordinate and manage interactions among workers more carefully.

Meeting overload
Despite the growing value of human capital, businesses are squandering their assets through a lack of organisation. According to research, European business people currently participate in 559 meetings per year - that equates to twelve per week - (interaction which occurs outside of other types of interaction such as email, or Instant Messaging). Interestingly, seventy three per cent of these meetings are conducted face-to-face, and yet, according to managers, only thirty two per cent of European meetings actually require face-to-face interaction! In other words, once the deal has been struck, the follow up sales meeting could be brought to the same conclusion by using technologies such as web meetings. Moreover, in many cases a better conclusion would be reached with a virtual meeting by reducing the stress and time wastage associated with business travel. By separating essential face-to-face meetings from those that are unnecessary, or even counterproductive we could dramatically increase the effectiveness of businesses.

Traditionally, travel has always been necessary to facilitate business and commerce - and the associated expense, time and stresses have been an accepted outlay. This has meant travelling to get some face-time with the customer to present your product or service. If you wanted to do a deal you had to look the customer in the eye, press the flesh and sign on the dotted line. However, as technology has advanced, many organisations have realised that we can do business much faster, far more often and across an increasingly broader range of goods and services by using virtual meeting technologies, such as online meetings.

Unfortunately, most companies abandon the attempt to make rational choices about the many meeting possibilities open to them and instead merely guess how best to assign employees. By failing to differentiate people with diverse skills, these companies forfeit the chance to maximise skills. A manager who wants the best people to do their best work must anticipate their meeting requirements. A systematic and continuous approach to fitting the right person to the right meeting at the right time is becoming the Holy Grail of workforce organisation. Few companies understand how best to structure their workforce so that skills are shared.

Making the best of your assets
All this is about to change. A new generation of technologies has made it increasingly possible to fashion a more sophisticated approach to the management of large distributed workforces. Real-time collaboration tools can adjust to customer demand to ensure that an internal specialist is available in every meeting, despite staffing issues. Web communication technologies can also provide the platform for unsung heroes to raise their profile.

Some business leaders have recognised the advances in technology and reengineered their businesses in line with current meeting technologies. This is especially true in the IT field, where businesses are used to using technology platforms to demonstrate their products. Whitaker Garnier, a partner to Microsoft, which sells financial solutions to Lloyds TSB, Lehman Brothers and others, uses online conferencing to demonstrate its technology via any web browser. Mark Weller, European Sales Director, says, Online conferencing does not replace the face-to-face chemistry of one-to-one meetings, but it does mean we can draft in a technical meeting into any meeting at the click of a mouse - essentially it means we can have a an expert in every meeting.

Matching people and tasks
If labour is the fastest growing expense in the knowledge economy, how can businesses capture productivity gains, to boost growth? New human-capital tools are one way for businesses to manage shortages of staff, and to spread the skills of its most important people.

To reap the benefits of the new technology, executives must begin with old-fashioned managerial insight. Otherwise, when a company implements a new technology, the likelihood is that employees adopt it in a piecemeal fashion, and the full benefits are not seen for a long, long time. When Toshiba Computer Systems implemented an online meeting service from WebEx, the company avoided this problem, by making clear distinctions between the skills of the workforce and the tasks they were given to complete. The General Manager, Oscar Koenders, says, A month of training courses was provided, to ensure that all the employees reached a professional level of understanding at the same time. At Toshiba we backed this up with an internal awareness programme, and clear instruction on which trips would be replaced, and which tasks use WebEx. For example, we decided to use online meetings for our marketing budget and website development planning - a simple decision which saved a huge amount of time and expense of business travel, required for a face-to-face briefing. By using online meetings, Toshiba saved 866 hours in the first year. This translates into 115 full working days. There was also a 75% cost saving in terms of overall travel budget, and a 25% increase in employee productivity. In other words, by identifying the critical groups of workers, Toshiba were able to understand how best to spread their skills across the enterprise, and create value by moving each employee to the most suitable project.

Turning to the technology solution
Falling telecom costs, the explosion of PC's, handheld computers, and conferencing services have transformed the way companies communicate with their employees. This electronic infrastructure has evolved enough to help companies map their human capital efficiently and cost-effectively: software can, for example, integrate recruitment, training, and staffing and thereby generate insights that once seemed impossible. Technology can also help uncover the management potential of all employees, not just those on the leadership track. The use of tools for connecting human capital can give companies a clear performance advantage by providing higher value from increased use of staff and through higher productivity - the result of improved training, and more effective deployment of the most productive employees.

A new era in human capital management is upon us. Value increasingly comes from boosting the productivity of individual workers and from greater workforce innovation. Meanwhile, the technology infrastructure needed to map out human capital is rapidly falling into place. By achieving the most productive possible combination of workers and work, the tools are available to enable companies to find a lasting source of competitive advantage.