Embracing the Human Capital Zeitgeist to Boost Business

Photo: I-Stock Red Leadership

In my recent Forbes.com post, 10 Reasons The Human Capital Zeitgeist is Emerging, I listed some key reasons behind the uptick in the race for skilled talent. To compete in a volatile global marketplace, I argued:

Big business, “might actually have to throw a bit more respect at the “human” in the human capital equation. It’s a socio-cultural shift that will have to address the work-life merge and worker satisfaction, like never before.”

My “Zeitgeist” theory about a new emerging workplace and business culture has been percolating for the last year as I’ve studied scores of reports and studies on talent retention, workplace flexibility practices, employee engagement and well-being. What I consistently found is that workplaces with high levels of engagement or well-being  - simply performed better. The question is, are they indeed more creative, and how does it impact the bottom-line?

The Argument for Creativity

A new study by technology giant Adobe, State of Create Global Benchmark Study, reveals a  creativity gap in five of the world’s largest countries (United States, United Kingdom, Germany, France and Japan). The study found:

  • 8 in 10 people feel that unlocking creativity is critical to economic growth
  • Nearly two-thirds of respondents feel creativity is valuable to society
  • But only 1 in 4 people – believe they are living up to their own creative potential.

The study showed a workplace creativity gap, with 75% of respondents saying “they are under pressure to be productive rather than creative.” That despite that they are expected to THINK creatively on the job.

Creativity is increasingly becoming more of a crucial component in the business model. Not that it wasn’t before, but now global companies are acknowledging it could offer a new important competitive edge when it comes to innovation.

CEOs Are Talking

Corporate chiefs know that creativity drives the innovation they need, to rise above the rest. CEOs are now dishing amongst themselves about the need to attract new blood in their fleets to drive profits. Not just run-of-the-mill drivers, but engaged, creative and innovative employees. Companies will need to warm-up their engines to attract the human capital they so desire, even in a rebounding economy, to effectively compete.

In PricewaterhouseCoopers 15th Annual Global CEO Survey 2012, CEO’s cited talent shortages and mismatches as impacting the bottom line.

“One in four CEOs said they were unable to pursue a market opportunity or have had to cancel or delay a strategic initiative because of talent challenges. One in three is concerned that skills shortages will impact their company’s ability to innovate effectively.” PricewaterhouseCoopers 15th Annual Global CEO Survey 2012

The report, Delivering results: Growth and value in a volatile world, found 66% of the CEO’s indicated that one of the top priorities was to personally spend more time developing leadership and talent pipelines.

Throughout the report numerous CEO’s touch upon the need to acknowledge the intricacies and importance of a humanistic approach in attracting and retaining skilled employees who once hired, will remain engaged and creative.

“People want to have an impact. They want to be listened to,” said Daniel S. Glaser COO, March & McLennan Companies Inc. Also echoing the human component in a changing world, Martin Senn CEO, Zurich Financial Services Group, weighed in with this comment: “I look for globally-minded people with the capacity to anticipate change and the flexibility to accept it.”

Culture Shift at Work

The talent pipeline is under the microscope, as companies contend with a shrinking working pool in new emerging marketplaces. New strategies to attract, retain, and engage skilled talent are in the works and that means a shift in culture, one that will arguably need to embrace human capital in new ways.

German philosopher, Johann Wolfgang von Goethe once said, “Talent develops in quiet places, character in the full current of human life.”

Character and individual uniqueness are fuel for innovation. And right now, the workplace, with companies tending to do more with less, is stressful as work-family conflict is more evident than any other time in history. It’s an argument for big business to woo employees by appealing to their human side.

That appears to be happening in progressive companies. In another of my other recent Forbes.com post, Employee Stress on Radar, for National Stress Awareness Month. I wrote about how employee assistance programs are focusing more on employee well-being and stress reduction. Some of those initiatives include work-life flexibility programs.

The Families and Work Institute’s 2012 National Study of Employers, suggests that flexibility is a “strategic consideration for organizations.”

“As flexible scheduling and workplaces become more common, organizations that fail to adopt these options run the risk of being outperformed by competitors who benefit from lower operating costs and better adaptation to a global knowledge- and service-based economy.” ~ FWI 2012 NSE

In conclusion, companies that don’t invest directly or indirectly in their talent pool’s needs and well-being in the new economy risk an unknown component that reveals itself generally in the 11th hour in the form of burnout, and potentially less creative and innovative employees.

Here’s the question: Without proper attention to the “human-ness” of human capital, will a company lose traction in a global competitive marketplace?