Many managers believe that their staff are their most important assets. This is a strong and true belief that reflects the concept of human capital acquisition. In fact, some people might find it weird to call the human element an asset. But it is a good choice of words as the quality of employees leads to an increase in its economic value. In the same way, machines and buildings contribute to business value. Acquisition and management of human capital in any business organisation is now an integral part of any company’s success. If you are curious about these concepts, this article will give you some insight.
What is human capital?
To get a clear idea of the meaning of human capital management and acquisition, you need to know more about human capital. Human capital refers to all the characteristics a worker has that add value to the economy of a business organization. So, these characteristics can include an employee’s punctuality, academic qualifications, practical expertise and abilities. You can consider human capital a kind of intangible asset, as it is not of a physical nature. In contrast to tangible items such as machines, equipment, and real estate offices,
So, if you are still wondering about the meaning of human capital, the following examples can make things clearer:
· The worker’s commitment, dedication, and loyalty
· Overall values and professional ethics.
· Mental and physical wellbeing
Despite being intangible and having an inability to be listed on balance sheets, human capital can be assessed and improved.
Why should companies pay more attention to human capital?
Human capital is the real power of any business. Machines can do a lot of work, but they are programmed and run by humans. Machines can produce products but can’t distribute them to retailers or sell them in stores. Also, only the human element is the only one who can work efficiently on customer care and support. Due to the huge significance of the human capital concept, there is a need to provide proper management.
Definition of human capital management
Acquisition of human capital simply means acquiring and maintaining human capital. It is considered a part of human capital management. Human capital management refers to everything a company or an organisation does to acquire, manage, and improve its human capital. This process aims to increase the economic value of its workforce. Typically, this will lead the company to stay ahead of its competition.
Human capital management and human resources management
These are not the same things, despite having some common grounds or interests. For instance, both fields are working closely on the company’s workforce. However, human resources is responsible for hiring and training the company’s employees. Human capital management, on the other hand, is about making the most of the company’s workforce in order to increase its overall economic value.
You can consider human capital acquisition or management a more extensive aspect. When your human resource management works properly, it can become the basis for successful human capital management. You can have your company’s HR team handle all aspects of human capital acquisition and management. However, a third-party company with specialisation and authority in this field can bring a fresh and objective perspective to the management process.