Human Capital Architecture

(Refer our High Quality Management Encyclopedia “Management Universe” at: http://management-universe.blogspot.com/) 

Introduction

• Human resources are human capital.
• Characteristics of human capital required for an organization will depend upon it's business strategies.
• Organizations adopting different business strategies will have different human capital needs.

Architecture

Therefore, one should conceptualize a suitable human resource architecture for an organization. One framework for analyzing different types of human capital required for the organization and the HR systems that generate this human capital is known as human capital architecture.

This human resource architecture is based on the thinking that human capital varies along two factors:

• Uniqueness of skills: whether the skills are general types or specific to the organization.
• Strategic value of the skills to the organization.

Based on the extent of these two factors i.e. the extent of uniqueness and strategic value of the skills requirements, the human capital architecture for an organization will be decided and accordingly, the employment modes of human capital will be selected.

Mapping an Organization's Human Capital Architecture

Following four employment modes will be resorted to create the human capital architecture:

• Work requiring skills that are low in uniqueness (they are general types) and are of low strategic value to the organization could be contracted outside the organization (outsourced/subcontracted).
• For work requiring skills that are high on uniqueness and are of low strategic value to the organization, looking out for right kind of partnerships or alliances is necessary. Here the relationships of the partners/alliances to the organization's in-house employees (whose skills are unique and are of strategic value to the organization) are vital.
• Transactional work requiring skills that are low in uniqueness but are of high strategic value to the organization will need in-house employed persons.
• Knowledge based work requiring skills that are high on uniqueness and also are highly strategic to the organization will also be done by the in-house employed persons.

Based on such mapping, the decisions to carry out the work within or outside the organization will be decided and accordingly, HRM strategies to build up the human capital will be worked out which in turn will guide the HR practices to be followed.

Build or Buy Approaches

With the above-mentioned discussion, an organization can start seeing as to:

• What and how much human capital to build within (in-house employment) and
• What and how much human capital to buy from outside (outsource/subcontract)

The in-house employment may promote more commitment, pride, quality and security. The outsourcing may result in less supervision, minimum contracted quality and low overall costs.

Books Suggested for Your Professional/Personal Library (All the titles as paperbacks and eBooks available online from Amazon)

Books Authored by Shyam Bhatawdekar and Dr Kalpana Bhatawdekar (eBooks and printed books available online from  Amazon)

Management, Business, Self-help & Personality Development Books

1. HSoftware (Human Software) (The Only Key to Higher Effectiveness)

2. Sensitive Stories of Corporate World (Management Case Studies)

3. Sensitive Stories of Corporate World (Management Case Studies) (volume 2)

4. Classic Management Games, Exercises, Energizers and Icebreakers

5. Classic Management Games, Exercises, Energizers and Icebreakers (Volume 2)

6. Classic Team Building Games, Exercises, Energizers and Icebreakers

7. 101 Classic Management Games, Exercises, Energizers and Icebreakers

8. 101 Classic Management Games, Exercises, Energizers and Icebreakers

9. Stress? No Way!! (Handbook on Stress Management)

10. HSoftware (Shyam Bhatawdekar’s Effectiveness Model)

11. Competency Management (Competency Matrix and Competencies)

12. Soft Skills You Can’t Do Without (Goal Setting, Time Management, Assertiveness and Anger Management)

13. Essentials of Work Study (Method Study and Work Measurement)

14. Essentials of Time Management (Taking Control of Your Life)

15. Essentials of 5S Housekeeping

16. Essentials of Quality Circles

17. Essentials of Goal Setting

18. Essentials of Anger Management

19. Essentials of Assertive Behavior

20. Essentials of Performance Management & Performance Appraisal

21. Essentials of Effective Communication

22. Health Essentials (Health Is Wealth)

23. The Romance of Intimacy (How to Enhance Intimacy in a Relationship?)

Novels, Stories, Biographies and Travelogues

24. The Peace Crusaders (Novel: thriller, mystery, adventure)

25. Love Knows No Bounds (Novel: a refreshingly different love story that discusses an important and topical societal issue. Also available with the title “Good People”)

26. The New World Order (Novel: socioeconomic, thriller, mystery, adventure)

27. Funny (and Not So Funny) Short Stories

28. Stories Children Will Love (Volume 1: Bhanu-Shanu-Kaju-Biju and Dholu Ram Gadbad Singh)

29. My Father (Biography)

30. Travelogue: Scandinavia, Russia

31. Travelogue: Europe

32. Travelogue: Central Europe

33. Travelogue: Egypt (Mysteries of Egypt)

34. सीमाओं के परे: (एक अलग प्रेम कहानी) (Novel in Hindi)

35. अमन के सिपाही (Novel in Hindi)

36. अभिजात प्रेम (एक वेगळी प्रेम कथा) (Novel in Marathi)