Human resource professionals should learn from economic principles, but not be bound by them. Economics is sometimes referred to as “dismal science.” When people are involved – there can be no controlled experiments – only experiences. Your expectations of people will become more accurate with more experience, but over time – no matter what – the behavior of people will continue to surprise you.
In human resources you must continue to learn. Adjust people to your company, and your company to the people. While economists try to quantify the effects of human capital, those working in HR know you must adjust to the people around you. For Human Resources, It’s a fine line – remaining true to your principles and procedures – while onboarding and minimizing the barriers to production for everyone at the company. Here are some of the most sound economic principles, modified for Human Resources:
Quote: “The problem isn’t that people don’t understand how good things are. It’s that they know, from personal experience, that things really aren’t that good.” – Paul Krugman
Comment: Paul Krugman is as close to a rock star as an economist can be in today’s world. Rock stars have the power to transcend music to culture. In the quote above, Krugman transcends irrational expectations of behavior economics to everyday pessimism. In human resources, you must know that the employees you help have lived full lives. They have seen things you have never seen. Temptation can say to them this isn’t as good as then, but human resources knows this also isn’t as bad as another then. Yes I’m talking about the water in the glass / company culture you live. Show your employees the flavor of your company’s water.
Modified Tweet: “The problem is that people forget how another could see how good things are. It’s that you must let them know, citing personal experience, that things of the present really are goods.” @AcademiaHR
Quote: “Men will not always die quietly.” – John Maynard Keynes from “The Economic Consequences of Peace” (1919)
Comment: Employee turnover is inevitable for a company. Sometimes employees leave happy, but other times employees leave bitter (for just and unjust reasons). Employee alumni can be a great asset or great liability. If an employee leaves happy, do little things to stay in touch, such as sending them a holiday card, or sharing something he or she would value via social media; this expands the enthusiasm of a great employer brand ambassador. If an employee leaves with a bitter taste of the company in his or her mouth, address the issue. If you believe the bitterness is for an unjust reason, practice damage control; speak to their clients and co-workers, and be transparent about why, given the company’s value proposition, parting ways was in the best interest of the company. If an employee leaves for a just reason, do not ignore it – learn from it. Sometimes an employee leaving for a just reason, can be a great opportunity for a company culture to look itself in the mirror and evolve.
Modified Tweet: “Employees will not always move on quietly. Manage the ensuing noise.” @AcademiaHR
Quote: “All money is a matter of belief.” – Adam Smith from “The Wealth of Nations” (1776)
Comment: Adam Smith is the Father of Economics. This simple mantra explains how money is fiat. The paper and cotton that money is printed on has nearly no value in-it-of-itself. In this way, the company’s brand is fiat. A company’s brand is built upon the value the community places upon it. Your employees (and the company’s resulting product/service) are the ambassadors to your employer brand. In human resources, you must show the employees why they should have pride in their work. An employee who takes pride in their work, will not only produce better work, but will also speak more highly of his or her company. This is how human resources can build powerful employer brands, which in turn will attract great talent.
Modified Tweet: “All employer branding is a matter of employee pride.” @AcademiaHR
Photo Credit Baltimore City Paper, Nonicoclolasos, The NewStatesman, The Energy Collective
@AcademiaHR is Alter-Twe-Go of @DavidSmooke. The account is dedicated to applying the great knowledge of the secular world into the day-to-day activities of Human Resources.