I have been kind of following a post on the Harvard Business Review blog about a hypothetical conversation between a CFO and a CEO that goes something like this – “The CFO says, ‘what if we invest in people through training and development and they leave us for a competitor? ’

The CEO responds ‘what if we don’t and they stay’.”

To date that post has received close to 400 “likes” and 350+ comments ranging from anecdotal to pedantic dialogues on the merits of both positions with the occasional shot at why HR stinks thrown in.

I personally despise the term human capital. As I have said here before the term to me implies something very transactional and short term. We lose sight of people as individuals. The combined talents and abilities of our staff do represent a significant asset and investment, but here is a news flash - 

Mr. Lincoln freed the slaves; we don’t own our employees or their capabilities. We rent their talents and behaviors!

I have written quite a lot on the social contract and the concept of personal competency. I won’t burden you with the details again, but fundamentally the way we see each other is screwed up.

I have been following a new show on Starz called Camelot. This is not King Arthur for kids. The relationship between haves and “have- nots” is pretty clear. In one scene a nobleman is confronting a particularly vicious King Lott about brutally murdering his wife and Lot’s response was, “you are being tedious, do you really expect me to remember a particular woman I killed?”

Kind of sounds like “human capital” doesn’t it.

For hundreds of years that was the model. The concept of the United States as a democratic republic and the idea of personal competence meant to change that, but the advent of the industrial revolution and scientific management largely attempted to change it back.

The conversation in the HBR blog post isn’t hypothetical for me as someone who has been in and around the Human Resources profession for over thirty years, I can’t tell you how many times I have been in C suites where that question is openly or subtly stated. Progressive leaders recognized it years ago.

"Companies have a hard time distinguishing between the cost of paying people and the value of investing in the."
-Thomas A. Stewart

It is 2011 and I am not sure we get it yet.

About 15 years ago I began refining and defining my own version of what we now refer to as employee engagement. I call my model moving from Compliance to Commitment. At its most simplistic is built upon five elements -

  • Respect
  • Responsibility
  • Information
  • Rewards
  • Mutual Loyalty

There are of course sub-elements and I have to admit I don’t have a template I work with. I have had a chance to implement my “system” in multiple settings ranging from high technology to not for profits and health care. The elements are the same; the design of the particular system is built to the organization. 

I bought into another heresy over 30 years ago.

  • There is no one right culture; there is a culture that is right for a particular organization
  • Culture is fluid; it evolves.

That is not to say that I don’t believe in things like core values and principles, quite the opposite. I do believe however the way you define and communicate those core values and model them needs to evolve and be checked for relevance.

Our employment relationship culture in my mind is way outdated and in need of serious overhaul. Trust in senior and middle management is at all time lows and employee dissatisfaction is at all time highs. Not being the sharpest tool in the shed (remember I was an HR guy) I see these as relationship issues. I am not sure how systems like Black Belt, Six Sigma, etc are going to fix relationship issues? 

Bluntly given that in many cases technology has been used to reduce personal competency and wages and head count I am not sure how we think technology is going to “fix” relationship issues either.

These days I spend my time trying to help organizations rethink their relationship models. I think congruence and engagement are way better than compliance.

I want to be clear that when I use terms like congruence, engagement, and others I am talking about alignment. Compliance with rules, regulations, and societal norms is fine; expecting obedience is highly over rated.

Our current approach to health care reform is destined to largely fail in my opinion for several reasons;

  • It focuses on health care delivery not health
  • It is compliance oriented rather than relationship oriented
  • Two of the major stakeholder groups – employer/sponsors and consumer/patients are largely left out of the process

Changing the way we manage health and health care in this country is not just about technology and cost, it is about relationships. It is about culture change.
We do culture change badly. We try to largely do it intellectually. We are going to “train” people to change.

Studies show that when our intellectual is in conflict with our emotional the emotional “wins” 85% of the time! Why do we continue to embrace a model with a success rate of 15%?

Here is a tip- if you want to see meaningful, sustained change you need to deal with people, whole people!

One of the elements to meaningful change is exploring something Ron Willingham calls congruency. He defines five levels of congruency that significantly impact meaningful behavioral change.

Another key element of sustained change is your process or methodology. I am lucky to work with a gifted colleague named Reut Hebron Schwartz who has created a model called KeyChange™. Her model focuses on what she refers to as implicit or change memory versus the traditional models based on explicit memory or storage memory.

Implicit memory focuses on the person and what is blocking or impeding the desired result; it brings into play the whole person. It facilitates congruency not compliance. It also gets results; measurable, sustained results.

I think we have a significant opportunity to improve our relationships and our results. In fact I wrote this article on the topic just last week:  http://bit.ly/dHTsNS

So I guess in parting I would leave you with that thought, maybe the key to fixing many of our issues is to focus on people. For those of you that are focused on compliance, technology, and systems I would ask you -

“How is that working out for you?


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