Human Capital: The disenfranchisement of employees

For a while now, the phrase "Human Capital" has replaced "Human resources" as the buzz phrase to refer to people in an organisation.

I suspect the well intentioned people within the "jobtitle and department naming" department were thinking that it suggested an association with capital and investment. How wrong they were. Let's look at some of the employment themes over the past 5-10 years:

Disenfranchisement of employees

Go back 10 - 15 years and there was a much stronger association between people and who they worked for. People expected to have a job in an organisaton for their career. They associated their identity with the company: "I'm a Mars person" or "I belong to Shell". Whilst I am sure that this is still true for some larger organisations, and some employees, many people have had this contract broken.

Pensions debacle

One good reason to stay with a company was the pension rights. By staying in a company with a final pensionable salary scheme you built up a strong pension, guaranteed to provide after you have retired. However the increasing life expectancies have driven a cart and horse through the actuarial calculations and Gordon Brown's stealthy raiding of the pensions dividends for tax purposes, have together undermined these attractive schemes.

People treated as capital

Remember that capital is a commodity. It is traded and swaped in markets. You don't invest in cash, you use cash to make some thing else (which will turn into cash). You borrow it and put it back. It is a commodity. We are seeing the same with the investment in people.

Partly due to the breaking of the contract of employment and the disenfranchisement of employees and partly due to capital constraints, training was dropped back. The expectation that people will not stay as long as they would means you either find a cheaper way to train then, don't train at all or rely on people who have been trained by others. The result, created a merry go around of employment, where the only ones winning are the recruitment companies and monster.com.

Permanent contracts?

Let us take another example. A few years ago a well qualified colleague of mine was offered a job in an IT development company. Typical terms, 6 months probation period, 3 months notice after that. Despite doing an excellent job, he was made redundant at 5 months and 3 weeks (when the notice period was still a week). Within 2 months he was in another job and six months later he was in the same situation again, being made redundant after 5 months and 3 weeks. This time it was because he had done such a good job, he had put himself out of a role in their minds. In neither case was he made redundant for adverse reasons.

You can imagine that now, whilst he is in a "proper job" with a full time contract, he is constantly thinking he has 6 months' employment left and that he is only as good as his last 6 months of deliveries.

In a final case, a friend of mine was offered a contract in a large company to replace a maternity leave. When I asked about the day rate and we did the calculations, we worked it out that he was being paid the same effecive salary as the full time employee he was replacing. Moreover, the company was not factoring in the costs of employment sich as NI and taxes. He received no offer of holiday time and no other benefits such as insurances. He would be taxed out of this. They thought this reasonable.

I recall arriving in an established company during the late 90s having moved from a redundancy to another job and then to this one. My first reaction was, "Gosh, these people have no fear in their eyes!". They were walking around as if the waves of redundancies on the outside world had not been happening. I was asked, by a lovely chap who had been in the company for 25 years whether I was a full time employee or a contractor.

I explained, I had a full time "permanent" contract, that was on 3 months' notice, whereas the full time "contractors" I was working with had contracts that provided for 6 months' notice.

He looked at me as if I had come from another planet. Two years later a large proportion of those people were made redundant and within 5 years, the place was down to around a quarter of its original size.

Anti-big corporate

One other piece in the jig-saw is the invideous trend towards regarding large organisations as nasty, selfish, money- grabbing, don't care about the environment, unethical monothiths that need to be brought down.

The BBC do it when they talk about profits without a reference to the investment return. Enron and Parmalat stand as blotches in a landscape that includes philanthropists who put their hard earned money back into society (yet people ignore). Television soaps put out the image of the rich as unworthy cheaters. Directors responsible for the running or large corporation at risk of losing their property, are seen as money grabbers. The green lobby is on the same wagon playing ethical and moral cards, where economic ones could be played.

No matter that the prosperity, increases in life expectancy and health, televisions that peddle this trash, and the ability to communicate together like we do, comes about largely due to these people working in these corporations.

The brand "me" generation and portfolio careers

When I first joined IT it was apparent that people in IT thought of themselves as part of the IT industry rather than a part of the company that employed them. The exception were those employed by the large IT firms.

Now we have the logical extension of that. People regard a career as a series of jobs seen in retrospect. We protect ourselves from unemployment by creating multiple sources of income through internet companies run in the evening, trading on ebay, property investments and other side (or main) businesses.

In "The brand you" Tom Peters makes it clear that you run your career now. You develop multiple sources of income. You develop your credibility beyond your cv through the internet, to others around you whom you connect with.

At the same time our communities have become on-line communities, and multiple ones as well.

Is it recoverable

So the interesting questions for organisations are:

"Can we as an organisation win back the loyalty, commitment and affiliation of our people?"

"What do we as organisations have to do to make it worthwhile investing in our people?"

"How do we regain their trust?"

"How to we develop a sustainable trust that will make a difference to us as an organisation?"

I welcome your comments and will put more later...

Phil

www.excitant.co.uk

"Work-Life balance": A dangerous way to think about the issue

You hear it all over the place nowadays. "I need a better work-life balance". "People have their work-life balance wrong"."You need to improve your work-life balance".

What this all suggests is that work and life are at the opposite ends of a scale. Like a children's see-saw in a playground, as one child rises ,the other falls; apart from those moments when both have their feet dangling uncomfortably off the ground. It suggests there is an old style pair of scales and, one one side there is the time you spend at work, on the other side the time you spend at life; and they work against each other unless they are in that precarious equilibrium of perfect balance.

I believe this expression, and the underlying thinking is is dangerous. Why? Because it suggests that work and life are different. Let's be clear now, they are NOT.

To suggest that work is not a part of life is to suggest that we all take off our heads before we go to work in the morning. It suggests that somehow we can enjoy life, but we can't enjoy work. It suggests that, in our lives, the time we spend at work is not a part of our "life".

The mere act of starting with the suggestion that life and work are separate, starts in the wrong place. It causes all sorts of wrong thinking as a result.

What are the implications behind this thinking. It suggests you can't enjoy work. It suggests that work is not a social activity. It suggests that at work you are somehow controlled and not yourself. It suggests that you have your life outside work and any part of work that exists, takes away from your life. It reminds me of the old factory mentality of the 50s, 60s and 70s where you went to work, did a mundane activity and then were released from this servitude when the factory hooter went off.

It also carries a deeper suggestion: that work does not contribute to your life;that they are separate. When I describe this face to face I usually have one hand to represent life and another to represent work, and they are held apart with a void between them.

Now bring those hands together.

What we have now is more about the balance of work in your life. It is also about how work contributes to the rest of your life.

Of course, I run my own business and enjoy what I do. It interests me. It challenges me. I learn things from it. I want to be better at it. To me there is no distinction between life and work. I can't imagine not being interested in what I do.

However, I recognise that there are people out there who have a different approach. They see work as a way of earning money to do other things in their lives. Of course that makes sense. Many people go to work simply to get money to "live" and enjoy things. But that never makes work a different thing to life. It simply has a different aspect and importance.

I was chatting to a colleague yesterday. She runs a business where there are a lot of part- time people running a business in their spare time to earn money, but they are self employed and geographically spread out. She can't "supervise" them, as they are working independently. They have to be self- motivated and self- managing.

Ironically, the answer in this environment is one which works in most environments: help people to understand what they have to achieve.;give them the tools to help them achieve it; provide the motivation and direction that they need, and trust them to get on with it.

In most cases people like to be trusted and make decisions for themselves. It is empowering (sorry - awful buzz word). It says "I trust you, you are an intelligent person, these are the guidelines and these are what you can achieve. Now use your initiative and judgment to deliver it". In those circumstances, people will deliver. The rest of management is making sure they are delivering and helping them to do it.

As another colleague said to me. "If you can communicate the vision and convince people of it, and ,at the same time, if you can communicate the values, then you have management cracked. The rest is simply checking that they are doing it.

In both these circumstances these people are using their life experiences, characters, skills knowledge and personalities to deliver and enjoy work.

Of course the work-life balance is used in the sense of overworking and not having a balance of other time in one's life. The other expression we hear about now is "Quality of life" and "Quality time".

So, my suggestion is that we ban the phrase "work-life balance". It is a dangerous and misleading phrase. The effect on employee -thinking is dangerous: I switch off when I come to work. The effect on management thinking can be similarly dangerous.

I suggest we use phrases like, "a balance of work in our lives", or "having a balance of work as a part of our lives". Both these expressions are far more inclusive. They recognise that work is a social activity; that chatting next to the coffee machine is a vital part of it; that enjoying what we do, learning things, and seeing a difference matters to people; that organisations are social networks; that the people in companies and their customers, partners and suppliers are also people.

Moreover, that work is a part of life. If we deny that we lead to a robotic model of management; one which no-one I know really wants, whether as a manager, or as those who are managed.

There are more dangerous expressions out there we need to be careful of. I'll cover more soon.

Phil

Excitant Ltd: Stimulating your Strategy, People, Performance and Results....
phil@excitant.co.uk
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