Role of Leadership In Human Capital Management | MBA IN HR

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Role of Leadership In Human Capital Management

28 Oct 2021
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Businesses in the recent past have confronted new challenges with the pandemic throwing up double disruption. A recent study by KPMG refers to these challenges of “automation and the changes brought about by virtual working”. With layoffs and re-skilling becoming the order of the day, there was a dawning realization that human resources in organizations had to evolve in their skills and size. There was a significant change in attitudes, within organizations, employees and society towards a shift to management of human capital. Past perceptions and methodologies evaporated and we are now looking at innovative leadership human capital management strategies.

The corporate world is still in the process of evolving, responding and countering disruptions; and require professionals that can look at creating value rather than simply administration of the workforce. This is where there is a growing realization of the importance of leadership in Human Capital Management.

The Evolving Role Of “S” In ESG And Its Impact on Organizations

ESG refers to environmental, social and corporate governance issues in how organizations manage their investments.

The SOCIAL aspect of an organization refers to its policies on manpower and society at large with respect to key issues such as its handling of diversity, gender equality, employee rights, community work etc.

Some of the important issues in Human Capital Management could arise due to the following reasons
1. Diversity and Equality
2. Mental Stability
3. Emoluments
4. Balance in Work and home
5. Recruitment policies
6. Retention of manpower
7. Community interface
The increasing focus of investors on employee skilling, training, and organizational culture has led to a paradigm shift in the way organizational leaders look at leadership. Clearly, the need of the hour is to move away from administrators to leaders and look at human capital as an important tool and opportunity for long term sustenance and growth of any business.

Away from an investor’s perspective, businesses are now getting oriented more towards building social capital. All this requires a perspective that transcends from convention to the unorthodox.

Human Capital in Business – A New Perspective

Human capital is defined by the OECD as the knowledge, skills, competencies and attributes embodied in individuals that facilitate the creation of personal, social and economic well-being.

In an organization, “human capital” is an important asset that helps it to have a motivated workforce, increase efficiency and maintain a sustainable competitive advantage. Employees that have sufficient knowledge, information, and creativity lead to customer satisfaction and lead to a higher competitive index for the organization.

The term “human capital” is considered as a key element in improving the assets of an organization, since it is a sustainable competitive advantage and increases the employees’ efficiency. Some organizational theorists apply the rules of human capital theory to prove the ability to create

To build on this concept, organizations have been looking at investing in education, training, physical and mental health care, external social activities etc as part of building human capital. Employees are referred to as human capital as they are viewed as composite along with knowledge, skills, health, and values.

Thus, Human capital management (HCM) would refer to practices that are focused by organization in an effort to provide competencies to the workforce by way of acquisition, management and optimization of people as also to provide a face to the community to build social capital.

Role Of Leadership In HCM

Leadership is the process of provoking a positive change in an organization. While conventional managers look at stability, the vision and the path are put forth by a leader. The management professional is being called on to envision a dual change in people management practices and present a face to society.

“The traditional HR role is changing very rapidly. In many organizations now, the expectation is that the HR team is really a business partner with a specialized focus on deploying, training, engaging, and getting the most productivity out of their people.

~ Carl Zangerl of Northeastern university.

As part of their core functional approach, an MBA tends to be responsible for employees within an organization.

With the rapidly changing scenario in the business world, most professionals are found wanting in leadership roles. Built-in concepts and practices that are focused on managing rather than leading, managers tend to be more individual contributors rather than modern day business leaders. Leadership skills required to be an effective leader could be.
1. Communication – Positive outlook towards constructive criticism from subordinates, peers and other stakeholders.
2. Team-building – Transforming through a SOCIAL approach (ESR). Aligning organizational goals with a motivated team and a positive society, would be far easier.
3. Human Centric – Ability and willingness to appreciate the others’ perspective within, and outside the organization is one of the key constructs that distinguish a leader from a manager.
4. Ethical Approach – This approach is crucial as managers are often in a quandary to decide when confronted with difficult and conflicting situations.
The Final Take

Organizations that fail in the leadership challenge will become increasingly redundant, going forward. Since there is no defined pathway to leadership in the current situation, An MBA in HR management should look to fuel social, economic and cultural changes. Human Capital assets now being viewed as important components of an invested organization, leadership skills in professionals need to make the most of their talents and abilities.

As human capital evolves in importance over time, future leaders will seek two goals – 1) measuring the gaps, and 2) leading to better efficiency and attainment of goals, both with a social outlook.

Human Resources Leadership at SOIL

SOIL Institute of Management’s One Year MBA in HR Management focuses on budding leaders with a global perspective who are equipped to handle the workload of a professional / manager in various industries and situations across functional roles. The world class programs are designed with a pedagogy that is industry led. The industry led teaching methodology allows students to evolve to a high level of self – awareness regarding their own leadership style, thus making them better prepared for their new role in the corporate world.

SOIL’s one year MBA in Human Resource management is a flagship programme that emphasizes on developing specialized skills, and nurturing leadership skills by building the students’ knowledge through core management subjects. The programme, through leadership training, exposes the student to take on challenges in emerging India. The innovative experiential and case method learning nurtures leaders that are inspired and come with a humane outlook.

SOIL’s HR MBA is a potent launch-pad for professionals wanting to accelerate their career armed with leadership skills, with top-notch corporations.

SOIL Institute of Management’s innovative pedagogy develops aspirants into leaders that are high on integrity and character. SOIL’s one year PGPM-HR program looks to take future HR leaders to the next level.

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