Human
capital management is a set of practices and processes related to hiring the
right people, managing the workforce effectively and improving productivity.
What is Human Capital
Management (HCM)?
Human Capital Management
is the set of practices, concepts and processes implemented in organizations to
manage productivity and employee satisfaction in the work environment.
In any organization, the
human team that makes it up has always been considered one of the fundamental
factors to achieve business success.
That is why human capital
management is increasingly applied in the business sector with the intention of
seeking the effective development of its employees, through strategic practices
and processes.
Due to the social and
technological advances observed in recent years, companies have needed to
optimize different spheres of management in order to:
- improve work performance;
- achieve good results;
- meet the needs of their customers with maximum efficiency and agility.
Among the many strategies,
investing in the development, motivation and productivity of employees has been
one of the most satisfactory and profitable options.
In fact, until recently,
the approach to the human resources, it was restricted to hiring, firing
and controlling employee benefits. For this reason, it was recognized for
having a mechanistic approach.
However, from the 80s,
companies began to embark on a new path, understanding, in this way, that
achieving better results is closely related to caring for the company with its
staff.
This closer look at the
needs and perspectives of employees has caused the Human Resources sector to
position itself as the main responsible for the transformation of the work
environment.
In this way, human capital
is considered the main concern of organizations and, today, it is classified as
the greatest asset of a company. But, ultimately, what is the relationship
between HRM and HCM?
What is the Link between
Human Resource Management and Human Capital Management?
There are many
similarities between Human Resource Management (HRM) and Human Capital
Management (HCM).
Both the HRM and HCM deal
with the human resource department, which is the specialized office of an
organization that deals with the workforce or employees and all related issues
and concerns such as recruitment, employment, training, mentoring, development,
performance appraisal, payroll, and other work-related services for employees.
The difference between HRM
and HCM lies in their processes and their responsibilities to corporate
routines. In essence, both types of management have essential roles in
organizations.
Human Resource Management
focuses its efforts on the development of a macro strategy thus generating a
bridge between the company and its professionals. While Human Capital
Management's main challenge is to develop the skills of employees, thus leading
to their commitment and maintaining a good work environment.
For example, HCM provides
an ambiguous response and relates to elements such as personal management,
organization management, human resource management, and develops employee
development strategies and other operational goals.
Therefore, for the company
to walk towards success, it is essential that these areas work as a team, align
their strategies and complement each other.
When the organizational
scheme of a company works successfully, it is mainly due to the effective
management it has over its work team.
Over time, more and more
tools are developed and applied so that the Human Resources unit can better
analyze the data of the profiles that apply for a job.
This means that corporate
leaders are increasingly focusing on how they manage their human capital, providing
them with more specific skills, achieving HR objectives and goals, and
developing a good organizational climate.
Why is Human Capital
Management (HCM) Important in an Organization?
Human Capital Management
(HCM) plays an important role in hiring, managing, training, retaining talented
and high-performing employees, and orienting a new employee to the system.
HCM helps an organization
in recruiting the right people. This will prevent it from hiring employees who
don't really deserve to be in the organization.
HCM sees employees as
capital, which means that organizations can grow their capital in the future by
investing in employees.
HCM helps employees
upgrade their knowledge with time to cope up with the changing situations.
HCM helps optimize and
maximize the value and ROI of the human capital in an organization.
HCM helps the organization
increase the overall productivity of the organization and achieve its
objectives.
HCM identifies needs in
the human team and manages possible improvements.
HCM maintains the quality
of its employees, perfecting their skills and training stages.
HCM deepens moral values, the sense of belonging, the spirit of teamwork and focuses on achieving common goals.