How to leverage your human capital

Finding great people, keeping them and inspiring them to do great things always ranks as a top concern on any CEO’s list. The ultimate goal is to attach people’s performance to workplace outcomes, but getting there is never as clear as it seems. Here are three critical areas that CEOs must focus on in order to get the most out of their human capital.

1. Performance management processes and accountability

Teamwork makes the dream work. Dysfunctional teams don’t communicate well, avoid conflict and have trust issues; team members rarely have the guts to hold each other accountable. Even then, fully functional teams will not perform without the proper goals and incentives in place. To truly connect people with your business plan or strategy, you need to make sure all goals have a direct connection to your objectives. Every employee should realize how their role impacts the business and what initiatives their team is working on to help contribute toward those objectives. Annual objectives should be broken down into more bite-sized, attainable goals, so the company can celebrate wins or acknowledge (together) when things are off track. This is performance management at its finest.

Managers play a key role in performance management for obvious reasons. Helping employees distill corporate objectives into directly attributable objectives is critical. Managers must also be ready and willing to confront and manage conflict, which is almost guaranteed to happen in some capacity if people are really acting as a team and holding each other accountable. Creating a trusting, safe environment that fosters constructive feedback and resolution will only enhance accountability.

As a CEO, putting significant thought into how your workforce will help you achieve your business objectives and broadly communicating it across your organization will provide a level of transparency necessary for your managers and employees to clearly understand who is accountable for what. Looping in compensation by tying bonuses and merit-based programs (individual and team-based) to your objectives will really drive home the importance of accountability. Otherwise, you may be rewarding those who fail to meet performance standards — only causing more misalignment.

2. Leadership development

Many of your next great leaders will come from within your organization. Effective leadership development is often a CEO’s most forgotten tool. Creating more structure around how you determine who is naturally poised for managerial or leadership positions in your company can have dramatic results.

For instance, the use of workforce assessment tools that predict behavior and cognitive ability are often used to identify high-potentials. Qualitative and quantitative results from any goals aligned with corporate objectives or cultural values can then also be used to create action plans that put your high potential employees on the leadership path. By developing current and future leaders, companies can promote and develop a culture that directly supports a purposeful, sustainable and socially conscious one that is committed to people. In turn, leaders can execute the overall business strategy and achieve desired results.

3. Employee engagement and culture

While customers are core to any company’s existence, CEOs should also focus on creating an employee-centric workplace culture. Companies that celebrate workforce diversity, encourage behavioral awareness and provide employee onboarding, training, development and socializing opportunities will undoubtedly have a more engaged and connected workforce than those that don’t.

As with most human capital management strategies, managers play a big part in employee engagement, especially when it comes to personal and professional development. Managers who take an active role in developing their team members through regular goal setting and development meetings will naturally have better success making their team perform. CEOs can lead by example by providing their teams with the same opportunities for mentorship and coaching.

Notice how I have yet to even talk about culture. The cross between the product or service you provide and all the focus areas I mentioned previously will give you all the building blocks you need to define your core values and set a culture in motion. Trying to define your culture before putting the aforementioned initiatives into action will likely lead to misalignment and a false sense of workplace culture.

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