Understanding Human Capital Management, Benefits and 5 Strategies

Lutfi

Strategy and the Important Role of Human Capital Management
Strategy and the Important Role of Human Capital Management

Rancakmedia.com – The meaning of human capital management or HCM must be understood by all business owners. Check out the full review below! HCM is an abbreviation of Human Capital Management, which refers to a set of procedures used by organizations and companies to recruit, manage, develop and maximize their employees. The goal is to increase their estimated company value.

The HCM process will produce various results, including:

  1. Obtain personnel according to the required skills
  2. Have staff with all the abilities needed in a work environment
  3. Improve results by successfully managing employees.
  4. Apart from the abbreviation HCM, there are additional companies that use the term Human Resource Management.
  5. To better understand both, see the following explanation!

Definition of Human Capital Management

Both HRM and HCM are responsible for managing the human component of the company. However, these two departments actually have different approaches to viewing individuals. This impacts how companies view it.

Human Capital is the department that handles people from a capital perspective. Besides that, resource human can be increased to increase company profits like other company assets. In essence, companies consider people or employees as assets whose value can be developed.

With this point of view, HCM evaluates the recruitment, training and salary payment processes as a form of investment that will provide ROI (Return of Investment). Investments can also take the form of providing employees with the best working conditions, as well as giving them a variety of useful benefits.

Human Capital Management Duties

In general, the role of Human Capital is to increase the value of a company's human resources so that they can utilize their potential to the maximum. Tasks performed by HCM during the process include:

  1. During the process of searching for possible employees, compile a database. When the time comes, the company is ready to recruit every open position with new employees who meet the specified requirements.
  2. Post-recruitment, HCM is trusted to prepare employees for work through the onboarding process.
  3. The preparation includes presenting tools, goods, company policies, and co-workers
    To improve employee performance, HCM also plays a role in training and development programs
  4. HCM maintains the company's best expertise through training and recognition programs
  5. Conduct employee performance assessments and manage all data related to employees.

Benefits of Human Capital Management

HCM considers employees to be more than just a tool to achieve business goals. Having HCM can provide a variety of benefits for individual employees and the business itself. Whatever?

  1. Increased job satisfaction is a byproduct of training and development efforts, such as increased productivity.
  2. The availability of management in the form of training and development can help increase employee retention and engagement with the companies involved. This can minimize costly turnover rates.
  3. Excellent knowledge of investment methods in human capital can help companies increase ROI (Return of Investment)
  4. The recruiting process went well because of HCM's capacity to attract great applicants and develop their capabilities for the company's success.

Strategy in Implementing Human Capital Management

There are five techniques that can be used to design good HCM in your company, namely:

  1. Set a clear and meaningful vision. This includes everything from the size and budget constraints of the business to stakeholder expectations and employee demands in achieving business goals.
  2. HCM can better close the gap between business and HR demands by gaining a better understanding of both. Prioritize training and development initiatives for prospective employees.
  3. Decide on the best strategy and the policies needed to design it.
  4. Develop a strategy to implement the strategy, which should include allocating sufficient resources, establishing a timeline, and allocating adequate funds.
  5. Verify your progress regularly to ensure everything is going according to plan.

Conclusion

HCM is an abbreviation of Human Capital Management, which refers to a set of procedures used by organizations and companies to recruit, manage, develop and maximize their employees.

HCM evaluates recruitment, training and salary payments as a form of investment that will provide ROI (Return on Investment). Having human capital management (HCM) in your company can provide a variety of benefits for individual employees and the business itself.

There are five techniques that can be used to design a good HCM, namely:. Set a clear and meaningful vision. Prioritize training and development initiatives for prospective employees.

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Lutfi

Hi, let me introduce myself, Lutfi Hulasoh, I am a writer and techno blogger. I started creating a personal blog writing informative articles about the latest trends and developments in technology. My writing covers a wide range of topics, from mobile applications to artificial intelligence, and I can also provide easy-to-understand explanations to help readers understand complex concepts.