The Chartered Institute of Personnel and Development and the Royal Society of Arts are calling on the wisdom of the crowd to help develop a common framework for measuring the contribution people make to business outcomes across the private and public sectors. Initial responses will be received through a social media platform.
By signing up to the Valuing Your Talent Challenge, HR and L&D professionals will join professionals from the finance and risk management disciplines, as well as broader management, in developing and refining a human capital framework for measuring the full extent of the value created and risk generated by the nature and composition of their workforces and organisational structures. In later stages of the challenge, they will be tasked with finding ways of making the framework easy to apply in practice, so that it can ultimately help organisations improve workforce skills and productivity and, in turn, organisational outcomes and performance.
The Valuing Your Talent (VYT) initiative, first launched in November 2013, is a collaboration between the UKCES, CIPD, CIMA, CMI, RSA and Lancaster University. Since November the project team has been drawing together a wide base of research, knowledge and practical experience in how best to understand and measure human capital. By identifying the organisational enablers and barriers that affect enterprise performance the team has created a common framework for valuing human capital. The Valuing Your Talent Challenge provides the opportunity to have a widespread debate and gain feedback from all those who have an interest in the measurement and understanding of people and organisational structures – particularly those who will ultimately have responsibility for implementing the framework in their organisations.
The Challenge, facilitated by the RSA as part of its RSA Premiums series, will run on an open and free-to-access social media platform over a period of 3 months. The first phase, lasting to 31 March, will allow anyone with an interest in this work to sign up and share their feedback on the framework, their insights into the opportunities and challenges of valuing human capital, and any case studies of how they have successfully reflected the value of their people.
At the end of this phase, the VYT partners will summarise the insights and update the framework accordingly. The Challenge will then move into an Open Innovation phase, from early April until mid May, where participants can suggest innovative and practical ways to apply the framework – for example through new methods, tools, technologies or resources – so that it is useful for businesses and other organisations. There will be a pot of £10,000 in prize money up for grabs for the best ideas.
All the insights and innovations generated by the Challenge will feed directly in to the final framework and research report to be published in the summer. The framework will be free and open to all, designed to encourage shared thinking and the development of more consistent practices across all sectors, for organisations large and small.
Peter Cheese, chief executive at the CIPD, said: “The need to understand workforce capabilities, engagement and alignment, training and learning investments, productivity, and the harder to assess and define characteristics of leadership and corporate cultures, has never been more recognised or more important. Yet we still don’t have common definitions or reporting practices in the most basic of human capital metrics such as headcount, and we’re still no closer to finding an effective means of measuring human capital value or assessing organisational and behavioural risk. For this initiative to succeed where previous attempts have failed, we need to have a broad collaboration across the different business professions and engage with thought leaders, academics, regulators, policy makers, investors and practitioners. We must harness the wisdom of the crowd so that we can establish a commonly understood and accepted framework and tap in to the widest possible range of experiences.
“Our goal is to create an open-source framework, and set of practical tools, for measuring human capital which will help all organisations understand the methods and potential measures for making good people management and HR practices much more visible and provide insight on how good HR drives value in a business.”
Julian Thompson, Director of Enterprise at the RSA, said: “The big idea behind this Challenge is that the issue of human capital measurement and management is too important, too complex and too sensitive to local context, for any one group of specialists to develop or determine good approaches. HR practitioners, management consultants, academics, business leaders, accountants and employees obviously all have a key part to play. But arguably previous attempts have failed to catch on because models have been developed in isolation from each other, and/or on a closed, proprietary basis.
“This experimental Challenge hopes to be the start of an ongoing open innovation community on the topic of better human capital valuation. Innovation is more likely when this community is diverse. That’s why we also want to invite creative ‘outsiders’ such as designers, developers, innovators and analysts from other disciplines to be part of the process.
But diverse collaboration is only possible when there is a shared foundation. The VYT framework provides a common focus for innovation around human capital value, but one that we expect to be continuously enriched and improved.”