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The true meaning of Human Capital

By: Walter Martínez

wmartinez@deloitte.com

 

The concept of human capital can be interpreted in many ways.  One of them could be looking at the person as an asset; as a resource that belongs to the organization and from which we can demand all its capacity and commitment.  A more suitable definition from what I have learned about this term over the years is that human capital is a treasure that a company or institution has available with respect to the qualifications of the personnel that works there. Therefore, human capital represents the value that each employee brings to the table, according to his/her studies, knowledge, capabilities and skills.

 

The main value of a company does not lie in its systems, controls, or machinery and equipment. As much as technology and data systems may evolve, nothing substitutes the value provided by human capital.  The biggest companies in the world are recognized by their talent and the attitude of their people. 

 

Many years ago I read that human capital is a non-depreciable asset.  Today, however, I can say firmly that it does. When? When we do not value it, when we do not train it and when we do not create an environment in which they can align themselves with the mission and vision of the organization.  What in the past was gotten through a mere salary is now much more difficult to obtain; it is necessary to recognize the person as an individual and not as a machine. 

 

I have seen how the best human resources leave a company, not for a better salary or due to excess work, but rather many times they leave in search of a better work environment, training and development opportunities, and overall, looking to fulfill that need to be recognized and valued.