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Why People are Not Your Greatest Asset

John Commins, for HealthLeaders Media, September 26, 2011

Ask any CEO, in healthcare or elsewhere, about the secret to success, and not a few will fall back on the tired platitude that “our people are our greatest asset.”

That phrase sets Tom Davenport’s teeth on edge. “That is utterly wrong. People are not assets. People own a very important asset called human capital,” says Davenport, the author of Human Capital: What It Is and Why People Invest It, and the coauthor of Manager Redefined: the Competitive Advantage in the Middle of Your Organization. “The ‘asset’ is an intangible that resides in the heads of employees, not in the bank account or the building of the company,” he says.

This is not just semantics for Davenport, who is a senior consultant at Towers Watson. To him the people-are-assets mindset is indicative of an antiquated management style that views people like office furniture – something to be arranged, inventoried, and occasionally sat on.

“You don’t manage people. You manage assets,” Davenport says.

If you understand that your employees own their own assets, however, you can create the work environment and incentives to get those employees to invest their human capital in your hospital.

Davenport spoke with HealthLeaders Media this month at the 47th Annual Convention & Exposition of the American Society for Healthcare Human Resources Administration (ASHHRA), in Phoenix, AZ, where he led a discussion on transforming the healthcare workforce.

“The question HR folks should be asking is ‘How can I get people to invest more of their human capital in their job here in this organization?” he says.

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2 comments on "Why People are Not Your Greatest Asset"


R Daniel King (9/29/2011 at 9:04 AM)
I disagree with Davenport that today's worker is "better educated, more sophisticated, and more demanding of their work experience." How are the products of a K-12 public educational system that [INVALID]ped from first in the World in 1960 to 24th today and [INVALID]ping "better educated?" It may apply for less than 10% of these graduates but the remaining will need extensive education and constant management to address their lack of education, self-esteem, and work ethic. If Davenport defines "sophisticated" as being exposed to more countries, states, cities, commercial events, sex, immorality, violence, selfishness, cheating, lying, dysfunctional families, entitlements, and the soft discrimination of lower expectations then I agree. But, collectively these are major challenges of the management level Davenport references that need to "manage the environment." If Davenport defines "demanding of their work experience" as a sense they are entitled to work on their on schedule, at their own pace, in their own manner be damn for outcomes, quality, efficiency or impact on other individuals and departments then I agree. Davenport is right on achieving the right environment but it is only achieved through effectively managing an increasing dysfunctional, morally challenged, pseudo-educated workforce. What Davenport has not recognized is there are two contrasting environments that impact organizational culture: accountable and political. The contrast between the two is an accountable environment is where individuals utilize political skills to achieve universal accountability starting with senior leadership. Whereas, in a political environment individuals utilize political skills to avoid accountability for the politically protected and deflect it to the politically isolated. Government, Wall Street, education and health care are all posted boards for the decaying impact of a predominantly political environment.

svbellistri (9/28/2011 at 9:07 AM)
Much of what the artical states has some bearing in the healthcare environment. My thought is that there has been an evolution in management direction and staff motivation. Executives and managers need to realize that one style does not fit all. Our employees are our experts and they can be the solution and the advancment needed in healthcare to obtain better outcomes.