Magazine article Workforce Management

WAITING FOR GOOD DATA: Valuing Your Talent Is One Thing, but Valuating Your Talent Can Be Complex-So Some Are Trying to Change That

Magazine article Workforce Management

WAITING FOR GOOD DATA: Valuing Your Talent Is One Thing, but Valuating Your Talent Can Be Complex-So Some Are Trying to Change That

Article excerpt

When Jeff Higgins was a controller at health care giant Johnson & Johnson, and later the chief financial officer for aerospace firm Klune Industries, he regularly shot down the HR department when they asked for support for projects.

"They never had the numbers to support their business case," Higgins says. "And the other divisions did."

That's long been the problem for human resources. Everyone says that human capital is their most valuable asset, but because the value of talent can be so difficult to measure, few HR leaders over the years have even tried to put metrics around their efforts.

From an accounting standpoint, human capital is defined as a liability, not an asset, and that's troubling, Higgins says. "Companies need a standard analytic principle to measure the value of their human capital so they can understand its worth."

When Higgins moved from the finance track to HR, he vowed to change all that. Beginning in 2001, he held several HR leadership roles in banking and real estate companies, where he worked closely with the finance department to build metrics that would quantify the worth of human capital. Then in 2009, Higgins launched the Human Capital Management Institute, or HCMI, a consulting firm that aims to help companies develop human capital analytics.

Higgins and HCMI are part of a growing movement to bring rigorous measurement to the people-management field. Consulting firms and technology vendors are touting products to better assess talent quantitatively. And companies are expanding efforts to dig into their "big people data" for business insights.

HCMI argues that if companies can measure the value of certain types of talent or behaviors, they make workforce investment decisions that will increase revenue, improve productivity and reduce turnover.

"Jeff brings the financial perspective to human capital analytics," says Julia Gometz, former director of people analytics and engagement for JetBlue Airways, and current founder of the Brandful Workforce consultancy. …

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