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The importance of human capital management in achieving operational excellence

As organisations face increased technology disruption in an ‘always-on’ era, the value placed on effectively managing people is at the forefront of leaders’ minds. Human Capital Management (HCM) is a term that comes up regularly as the future of workplaces continues to evolve.

We recently spoke to Jelena Coso, Capability and Change Leader at Mercer, on her insights on the link between HCM and operational excellence.

To begin with, what does HCM mean to you?

“HCM is understanding the skills and capabilities that currently exist in our organisation, understanding the gaps we have and identifying where we want to be (i.e. the skills and capabilities we need for the future).

“It is also about developing current skills and capabilities and working with our teams to upskill them, so they have opportunities for growth and the capabilities needed for the future.”

This is a hot topic because of the disruptive work environment with AI, robotics and automation. How do you ensure staff are looked after culturally, and don’t feel threatened in such an environment?

“It’s very much a work in progress, and it is about bringing people along on the journey; helping them understand that automation doesn’t necessarily mean their jobs become redundant. Instead, we are trying to expose them to new skills and capabilities so they can see that these opportunities give them the ability to grow and develop by removing the mundane, manual tasks they are currently performing. It is about opening opportunities for growth.”

How does an organisation make the transition to automation?

“It tends to be based around identifying bottle necks and inefficiencies, recognising where a process can be simplified and taking that first small step. What we have found to be very helpful is the Enlighten tool. It is powerful in showing us where our inefficiencies are and identifying opportunities for growth and change. It allows us to pinpoint and target areas that need to be addressed, automate those processes and close the gaps.”

The recent Gartner Hype Cycle for Human Capital Management Technology, where Enlighten was named, refers to mid-to-back office tools that help with managing your human capital. How important is it to have that element to managing your people?

“It is crucial. We are working to embed Enlighten into our organisation. Not only as a workflow management tool, but also as a business optimisation tool. It’s important to have a tool that enables a holistic view of the organisation – one that encompasses process management and human capital; and then allows us to manage the implemented changes. Working with Enlighten we can implement changes that gives us the ability to achieve operational excellence. Because the tool is so powerful, it allows us to link all the different elements together and use the data to its maximum capability.”

How do you address the issue where some team members feel that workforce optimisation tools are ‘big brother’ tools? How do you work around that sort of thinking?

“This is probably one of the main obstacles we have had, and we still have to some extent. Our focus has been on educating the team on the benefits of the tool, showing them how they can use it to identify opportunities to upskill and develop their team, to improve processes and support team members in their development. It’s not a monitoring tool, rather something that can be used to support a team’s performance and enable them to perform at their optimum level.”

Do you have any thoughts on the future of what your workforce may look like?

“We are all about flexibility, or we’re trying to be. This is something that I promote with my direct reports. It’s not about where we are, but it’s about meeting our targets and meeting our objectives. So, as long as there’s a clarity around the expectation and best way we can measure our success, then the flexibility is there, and it should be utilised. So, it’s something that is strongly encouraged within our organisation.”

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