In this month’s Human Resources Magazine, Richard Donkin’s column carries this subheader:
The tired assertion, ‘people are our greatest asset’, has been disproved by the credit crunch.
To be fair, a lazy sub-editor may have added this sub on to the full article before popping out to do the Christmas shopping, but it is more or less the gist of the article.
The piece is a bit of let down – sad, because normally Donkin is a good read – it’s riddled with false logic.
Here’s the logic, paraphrased:
1) RBS was widely praised for its great HR work, particularly in performance management. It was almost the epitome of the phrase ‘our employees are our greatest asset’.
2) RBS is in bad shape (stock down about 75% since September), not least owing to its over-priced pre-slump purchase of ABN Amro.
3) Outside influences can clearly drive a company’s financial strength down. Therefore ’employees are not our greatest asset’.
This sort of syllogism just doesn’t hold up. Who made the decision to buy ABN Amro? A machine? Who approved it? The birds on the trees? It looks to me as if RBS’s performance management system had one problem: it did not extend widely – or high – enough.
Here’s how Richard Donkin wraps up his piece:
The credit crunch demonstrated that a business is not people alone. Nor is it a building or the services it provides. There are abstract, human, emotional, constituents – trust, love, anger, panic. We can never truly value these things. They will remain the hidden, perilous, measures of performance.
So let me get that straight. A business’s value is not entirely made of people, therefore people cannot be its greatest asset. (Hhm – my house isn’t entirely made of bricks, therefore it can’t be made mostly of bricks?).
The title of this piece, though, is exactly right: Don’t ignore trust, anger and panic. Yes, these things are crucial. They are also human, and yes, you cannot measure them. But just because you cannot measure them, doesn’t mean that they aren’t important. And precisely because they are human, they demonstrate how crucial people are to any organisation.
I blogged in March 2007 that People are our greatest asset – you just can’t say it, and nothing here causes me to revise my opinion, except perhaps to add this codicil: as well as operations, people are responsible for good governance and good shareholder advice, too.