Risk & Business Magazine Gifford Associates Fall 2017 | Page 8

HUMAN CAPITAL RISK MANAGEMENT
BY: MICHAEL MCQUAID
Human Capital Risk Management
W
hat do executives
think about when
they consider their
human capital?
Hopefully they “look
both ways before crossing the street.”
And, there are only two tasks that matter
most to entrepreneurs: those that when
completed, will either make money in the
near future or will make customers happy.
Inevitably a discussion around human
capital risk management can move in
several directions, depending on the
perspective adopted. Considering its
inherent nature, human capital represents
an organization’s largest investment.
Employees engage the organization
on many levels: customers, fellow
employees, potential employees, trading
partners, regulators, investors, and the
public. Human capital engagement can
either enhance or detract from these
relationships. But to approach human
capital as either an asset or liability is
tantamount to crossing the street looking
only one way, and the likelihood of
successfully making it across is severely
reduced. Our parents’ sage advice still
holds true: “Look both ways!”
Managing your human capital as an asset
and improving your return on investment
(ROI) through Top Grading is more
exciting; it ties directly into corporate
strategy, research and development,
exemplary customer service, market
share, and profitability goals. It is
inextricabl