Rule No. 8: Manage human personnel, capability, and knowledge capital to increase human worth

20^th century management administers human resources

20^th century management provides the human resource function to administer human resources. Human resources provide administration for recruitment, actions, payroll, and some development functions. While human capital may be called human capital, rarely is there any real effort to develop humans as actual capital to meet the specific business needs and increase worth to the enterprise.

20^th century management cannot develop and apply human and knowledge capital directly to the business

Some more advanced companies try to develop human capital, but as humans rather than as the specific capital needed by the business. They are at a disadvantage because the business is not organized to define specific business needs, to understand where special capabilities are required in the business, to understand the value created in the business through application of human capabilities, and the added worth of human capabilities through value creation.

Rule No. 8 of 21^st Century Management: Manage human personnel, capability, and knowledge capital to increase human worth

Result-performance Management (R-pM) organizes the business results produced and human capital as performance solutions to be utilized to produce specific results. As part of this rule, R-pM provides principles for strong human capital management:

• Analyze the business process to describe the human capabilities that must utilize the process to produce difficult high-value results
• Define specific high-worth capabilities to produce high-value results as performance solutions for specific human knowledge and human capability development
• Focus human capital on results, so that they always know the results expected and how to apply their capabilities to produce results
• Develop human capabilities as specific performance solutions to produce specific high-value results
• Support human capital with knowledge capital to utilize specific performance solutions to produce specific results
• Let human capital know the value of their results and how their performance can add value to results
• Let human capital know the relationship between the value added to results produced and their worth to the enterprise as human capital
• Compensate and reward human capital in accordance with their human capital worth

Strategic human capital development develops the capabilities described in the business process and the knowledge required to produce new high-value strategic results. R-pM manages human capital worth and human performance cost in relationship to the value of results produced, and continually develops improved capabilities to produce higher-value results.

Human capital includes three classes; personnel, capability, and knowledge

R-pM provides three classes of human capital:

• Human Personnel Capital: Readiness capital solutions deployed to be ready to produce a set of results as managed
• Human Capability Capital: Production capital solutions deployed to provide a specific capability required by the process in order to produce a specific high-value result
• Human Knowledge Capital: Information capital in specific knowledge solutions for human development and for operations to utilize performance solutions to produce specific results

Human Capital Management is responsible for managing personnel capital to keep humans ready to produce routine results, development and deployment of human capabilities when needed to produce high-value results, and development and provision of human knowledge capital that specifically develops and supports the human performance needed to produce results.

Human personnel capital keeps human capital ready to produce results

Human personnel capital provides human capital administration to recruit, orient, reward, and maintain human capital to be ready to produce results. Each individual utilized by the business to produce results at all levels is a human personnel solution. This includes part-time, contracted, seconded, or personnel from another enterprise utilized under enterprise management to produce results. Human personnel capital is utilized to produce the day to day results required by the business. Human personnel are normally assigned to a result organization unit to produce results in the set under the responsibility of the result unit manager. Human personnel capital produces human capital management results carried over from the existing business.

Human personnel capital also manages periodic human worth assessments to determine and update human capital worth related to performance as human capital solutions and result value added to the business. Human capital worth assessments provide the basis for annual and special rewards and human career planning in capability development and result utilization.

Human capability capital develops and deploys human capabilities to produce specific results

R-pM develops needed capabilities to produce result value and increase human capital worth. Every business has some difficult high-value results to produce that require specific human capabilities such as salesmanship, equipment expertise, innate analytical ability, management skills, extensive result experience, technical training, human handling skills, etc. The advanced capabilities needed to produce a result must be defined as a requirement of the business process to enable recruitment and development of human capabilities specifically to add value to the business. Human capability capital develops, maintains, and deploys the capabilities required by the business. Human capability solutions are defined by the capability required. Several human personnel solutions may be developed to provide the capability.

Human knowledge capital develops human capabilities and guides utilization of solutions to produce results

Human knowledge capital may develop and maintain some generally applicable business knowledge, maintained by business subject, as is the case in 20^th century management. But, the focus of human knowledge capital in 21^st Century Management is to create and utilize knowledge that is specifically applied to the business. Knowledge is needed to utilize specific performance solutions to produce specific business results and to orient personnel and develop capabilities to utilize solutions to produce results. Human knowledge capital must be developed as a part of every capital development project, with the documentation records, to provide the human instructions and other knowledge needed to utilize new solutions to produce specific results. Human knowledge is delivered, usually in conjunction with business data, by specific solution or result identifier. Human knowledge is also developed as a solution to develop human capabilities required by the business and to provide specific knowledge solutions that may be needed by management or special business circumstances.

R-pM provides the means to develop and utilize human capital to produce results

The procedures and guidance to organize the business to utilize human capital effectively is provided in The R-pM Toolkit, now available at result-performance-management.com.