Developing Human Capital
Organizations compete over market access and dominance in the global arena. For an organization to stand out from its competition, it needs well-capacitated human capital. A well-capacitated human capital possesses effective communication and persuasive skills, leadership skills, technological savviness, and marketing and sales acumen. The organization can equip employees with these skills by undertaking employee development programs tailored to their areas of work. Organizational leaders are sometimes reluctant to train their employees because they worry that the employees may leave the organization immediately after completing their training programs, hence leading to resource wastage. However, CEOs should be more worried about the cost of having loyal employees with limited capabilities. It is worth noting that employee development motivates employees, besides equipping them with the necessary skills to perform their jobs. Human capital development equips employees with knowledge, which attracts intellectual skills, enhancing their productivity and efficiency.
Competency Frameworks
According to Campion et al. (2011), for the organization to conduct human capital development, it is crucial to set out the specific skills, knowledge, and behavioral requirements necessary for employees to do their jobs successfully. A competency framework defines what performance success looks like for the organization and individual employees. Among others, core organizational competencies include teamwork, personal effectiveness, achieving business results, leadership, technical knowledge, critical thinking, communication effectiveness, and organizational knowledge.
According to the competency model, there are core competencies that every employee requires to succeed regardless of their job. These competencies may differ from one company to another, depending on organizational culture, objectives, and philosophy (Campion et al., 2011). However, core skills like teamwork and communication apply to almost every company since most jobs require employees to work with others to some degree and interact effectively. Competencies that depend on organizational objectives may differ depending on the company’s goals (Campion et al., 2011). For instance, in a delivery company, the job-specific core employee competence is on-time delivery of parcels.
Moreover, there are functional competencies that are unique to an employee’s role. For instance, a key competence for a salesperson is the possession of persuasion skills, while a supermarket attendant requires the ability to handle customer complaints. Functional competencies enable an individual to be a top performer in their roles. Also, leadership competencies are crucial in any position that requires leadership skills, such as decision-making.
Steps Required for Future Innovation and Growth in the Organization
Innovation refers to the methodical approach organizations leverage to create and introduce groundbreaking services and products likely to gain customers’ acceptance. It involves the digital technologies and critical thinking that organizations leverage to implement change, create value, and enhance stakeholder interactions (Verworn & Herstatt, 2002). Innovation is not limited to the adoption of new technologies but also includes changing how the business operates by adopting new business models.
The first step of innovation is opportunity identification, which involves gaining insight into market and customer needs through market research. After opportunities are identified, the next step is ideal generation and collection, which involves employee participation through brainstorming sessions and collaborative efforts across multiple departments (Verworn & Herstatt, 2002). Innovative idea generation is crucial because it helps organizations come up with ideas that may transform services and products. Having generated a wide pool of ideas, the third step involves choosing the most promising ideas by considering factors such as technical feasibility, alignment with organizational goals, and resource availability.
In the fourth stage, the selected ideas are passed through development and prototyping, where ideas are transformed into tangible models. The fifth step involves testing prototypes with their potential users (Verworn & Herstatt, 2002). Once an innovation is accepted, the sixth step involves implementation and scaling, where the service or product is executed in the market. Finally, lifecycle management is the last and continuous step in which organizations monitor an innovation and identify areas that require improvement.
Important Traits for Successful Leadership
As mentioned above, leadership is one of the vital organizational competencies. Individual employees should learn leadership skills with the help of the organization to perform their roles effectively. One key trait of successful leadership is the ability to delegate to avoid overwhelming oneself with tasks that can be effectively done by others (Kragt, 2022). Secondly, great leaders require agility and adaptability. Faced with uncertainties that characterize the business environment, including pandemics, climate change, and a hyper-competitive business environment, successful leaders should implement changes that align with dynamic business needs (Kragt, 2022). Another key trait of successful leaders is creativity and innovation. Tim Cook and Steve Jobs are credited as successful leaders, having looked into the future and implemented changes that put Apple ahead of competitors. Also, the ability to motivate employees is crucial as it produces engaged and efficient human capital (Kragt, 2022). Finally, decision-making is a vital skill for employees. Great employees should identify a conflict and resolve it before it affects an organization’s operations.
Factors to Consider When Developing a Leadership Strategy
HR professionals should consider the business strategy and its implications on leadership while developing a leadership strategy. This step requires experts who understand the business, and, may involve a SWOT analysis to identify business needs (Pasmore, 2014). Secondly, HR professionals should consider business drivers to determine the most effective leadership strategies. For instance, in the restaurant industry, a key business driver may be client satisfaction, hence, the leadership strategy should be customer (Pasmore, 2014). Also, it is crucial to consider the competition a business faces before identifying the most effective strategy. For instance, in the technology industry, innovation leadership will suffice because technology keeps shifting.
Challenges in Developing Leadership Strategies
While developing a leadership strategy, organizations may face challenges that may hamper the adoption of an effective strategy. One of the challenges organizations are likely to face is skills shortage (Pasmore, 2014). If an organization adopts innovation leadership, it is not guaranteed that employees are creative. Also, cultural differences may pose challenges, especially for multinational organizations. For instance, if an American MNC operating in China adopts collaborative leadership, Chinese employees may face difficulties aligning with this strategy because, culturally, they prefer top-down instructions. Thirdly, there is a likelihood of facing cost constraints while developing a leadership strategy. Once an organization adopts a leadership strategy, employee development is necessary, but it requires significant investment. Research by Times Magazine in the US shows that development costs average $1200 per year per employee, or 2-3% of organizational payroll costs (Pasmore, 2014). Therefore, implementing some leadership strategies may not make economic sense.
Metrics for Measuring Leadership Development Approach
The extent of employee engagement activities is one of the metrics for measuring a leadership development approach. It is worth noting that employees are informal leaders. Therefore, if leadership development leads to enhanced engagement amongst employees and with the organizational leadership, one can conclude that the leadership development approach was effective (Pasmore, 2014). Engaged employees are more productive because they can exchange ideas on how to improve individually and as a team. Moreover, the leadership development approach should fulfill business needs. Once the leadership development approach addresses the known business needs, then that approach is deemed successful. By fulfilling business needs, a leadership development approach will help the business gain a competitive advantage. Finally, a well-thought-out leadership development approach should return benefits at the individual, team, and organizational levels (Pasmore, 2014). This collective approach is sustainable and will bring long-term benefits.
Making Managers Better Coaches
Managers should be better listeners to become better coaches. Westfall (2019) avers that employees who feel that their voice is heard are 4.6 times more likely to be empowered. Listening to employees does not amount to letting inmates run the asylum; rather, employees’ input can shape a manager’s perspectives positively. Also, managers should reject their static premises as they can hinder progress (Westfall, 2019). A great manager should realize that they possess limiting beliefs and pursue objectivity. Finally, managers should foster an environment of safety where employees feel free to criticize anything without fear of retribution (Westfall, 2019). Once managers create an environment free from judgment, they will interact with followers better.
Conclusion
Human capital development is vital to equipping employees with the capacities they require to ensure organizational success. To develop employees, there is a need for CEOs and managers to analyze competency frameworks to discover organization-specific skills that will help the business to prosper. A competency framework offers insight into core, functional, and leadership competencies necessary for organizational success. To improve leadership competencies, the organizational CEOs should implement a leadership strategy that aligns with the business strategy and needs. Since employees are informal leaders, a leadership developmental approach should equip them with the necessary traits that make successful leaders.
References
Campion, M. A., Fink, A. A., Ruggerberg, B. J., Carr, L., Phillips, G. M., & Odman, R. B. (2011). Doing competencies well: best practices in competency modeling. Personnel Psychology, 64(1), 225–262. https://doi.org/10.1111/j.1744-6570.2010.01207.x
Kragt, D. (2022, December 7). How Busy People Can Develop Leadership Skills. Harvard Business Review. https://hbr.org/2022/12/how-busy-people-can-develop-leadership-skills
Pasmore, W. (2014). Developing a Leadership Strategy A Critical Ingredient for Organizational Success. https://www.ccl.org/wp-content/uploads/2016/09/developing-leadership- strategy-center-for-creative-leadership.pdf
Verworn, B., & Herstatt, C. (2002). The innovation process: an introduction to process models (No. 12). Working paper.
Westfall, C. (2019, July 5). Why Coaching Matters: How Leaders Can Become Better Coaches And Build Stronger Teams. Forbes. https://www.forbes.com/sites/chriswestfall/2019/07/04/coaching-matters-how-leaders- become-better-coaches-build-stronger-teams/
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Question 
Developing Human Capital
Imagine the following conversation taking place between a CEO and the director of HR:
CEO: What if we invest in the development of our employees and then they leave our company? Aren’t we wasting that investment?
Director of HR: Well, what if we decide not to invest in the development of our employees, and they stay?
Developing Human Capital
Developing human capital is a top priority for organizations aiming to be successful and effective. In fact, it is an important factor in retaining winning talent. For your Assignment this week, imagine that you have been appointed for a special project to build the human capital at Global ProTech. You must research how to develop human capital.
Submit a 3- to 5-page paper that addresses the following:
Analyze how competency frameworks help determine capabilities needed for organizational success.
Analyze steps required for future innovation and growth in the organization.
Distinguish at least five important traits for successful leadership.
As an HR professional, identify at least three factors to consider when developing a leadership strategy.
Identify three challenges in developing such strategies.
Identify three metrics that you would use to measure a leadership-development approach and explain why these three metrics will build human capital.
Finally, provide three suggestions that can help managers to be better coaches.