Managing Human Capital in a Way Better suited for Individuals – Can a Tool Common in Marketing be of Use?
Human resource management (HRM) – or Human Capital Management (HCM) as it is often referred to nowadays – can be logically stated to be sensitive to societal changes. This is due to its nature as an organizational function that links to the values, educational processes and structures and behavioral patterns in the everchanging world around the company.
Some of the changes that have affected HCM in modern companies are contradictory. On one hand, advances in data and analysis tools propose that human capital can be better developed via the deployment of wider and deeper “people analytics”. On the other hand, the strengthening tide of protecting people´s privacy and integrity from misuse and misinterpretation of the data gives a clear counterargument. Examples of the technologies – as listed by a leading ICT research and consulting company Gartner (2019) that have the potential to offer companies a more data-backed view on their people processes are blockchain, artificial intelligence, augmented analytics, and quantum computing.
In addition to technologies, HCM is also prone to changes affecting societies at a wider scale, often referred as megatrends. For the current decade, megatrends worth following and reacting or even proacting include, for example, shift towards flexible workforce, and adoption of artificial intelligence and digitalization etc. (Minbaeva, 2020). Another perspective that sheds light on the urge to rethink and renew HCM practices and principles is the generational shift taking place in the world of work and the way generation Z represents the potential new recruits to firms, future talents, and leaders of the organization (Cristina, 2021). Prior-art research has described the relationship between the people of Gen Z and work as well as the need to adapt the HCM to suit to the worldview of Gen Z, e.g., in the following ways: flexible hours, diversity and inclusivity, work-life balance, transparency, continuous learning and sense of purpose or belonging. Companies must take specific action in these areas to counteract the changing demands (Klein, 2020).
The agents of HCM change are posing a dilemma: How to offer individually considerate HCM experience to attract, keep and further develop talent yet have a fair and solid HCM process?
A potential answer to the call might be available in another field of science and business organization – marketing. Marketing researchers as well as practitioners daily use concepts such as segmentation and customer experience to better match the firm´s offering to the needs of the clientele. To still maintain some benefits of economies of scale, a concept of mass tailoring appeared. In short, the idea of mass tailoring is the intermediate concept between mass marketing and fully individual offering. On the HCM side, many companies have been mass tailoring in the past without using the marketing-originated word. Clustering the personnel based on their performance and on their perceived potential is a well-known practice to many HCM professionals and employees in big corporations. Getting identified into the “high potentials” cluster often gives the employee access to specific training programs and mentoring.
One concept of marketing that has spread widely in the 2010s and 2020s is that of personas. Personas in marketing try to capture (instead of aggregative market size estimations) the “life and mindset” of a limited number of potential customers as human beings – personas. Most often, personas are (partly) imaginary yet possible descriptions of customer demographics and psychographics, added with descriptions of things such as “watering holes” (the environments that a person links to in their free time) and “day-of-life” (how a person´s activities are organized in a typical day they live). This concept has been used, e.g., in the entrepreneurship education to better understand the potential customers and influencers and their needs (Aulet, 2013). Personas have also been used as archetypes to which educational offerings and processes have been developed.
One example where persona concept was used for HRM research is a bachelor’s thesis on work-life balance expectation of young talents. The persona concept was developed based on the data sample. Based on research data the following figure demonstrates average set of expectations young talents have. In this figure, fictional Mr. Y is the representative of an average sample subject. Noteworthy, gender is not relevant to this profile, but the profiling factors are (Mikhlina, 2021).
Figure 1. Mr. Y profile (Mikhlina, 2021)
Thus, it can be logically argued that the conscious use of personas within the realm of HCM would offer companies advantages by (i) giving people analytics a human touch, as the analysis of human performance would not be done on a fragmented level one variable at the time, but the employees would still be seen as human actors, (ii) offering the HCM a way to apply mass tailoring strategies to the recruitment, retainment, and development in the changing demographics and psychographic employee landscape, and (iii) strengthening the need-based specification of HCM tools and processes instead of technology- and system-based view.
However, in a similar vein, these opportunities may face difficulties on the level of both principles as well as practices. Some foreseeable challenges derived from earlier research are:
- since persona development would need a lot of “soft information” about current and potential employees, is collecting that information and acting on it is an ethical way to operate?
- are the personas created averaged compromises of the reality, i.e., is the company shooting off the target but equally so for every HCM customer?
The challenges stated above are not linked to the concept of personas alone. Likewise, strict, and very little individually considerate HCM processes can be stated to be fair, but also in the sense that they fall short of a goal based on the needs of current and future employees.
The research gap on the current scalable HCM responses to the megatrends of individualism and value-driven behavior is evident. There is some research on the relationship between HRM or HCM and individualism (some hits in a Boolean search combining the words “Human Resource Management” OR “Human Capital Management” OR “employee management” AND “Individualism” OR “individual” in the research title, Google Scholar October 2022), but the discussion on HRM/HCM/Employees AND mass tailoring/clustering/personas is almost non-existing in what comes to the motivations and implications (hits in Google Scholar, October 2022) since the biggest volumes of published research seemingly focuse on the development of clustering algorithms. The question of “how?” has superseded the questions of “why?” and “so what?” in the prior-art-research.
To close the gap of research and shed light on the identified phenomena and potential solutions, qualitative research among a sample of both HCM and marketing practitioners has been initiated in Jamk University of Applied Sciences. Meanwhile, feel free to comment or contact the authors to propose views of the issue as well as the potential collaboration in the research still at an early stage.
Authors:
Juha Saukkonen, D.Sc. (econ.), Jamk University of Applied Sciences, School of Business and Services Management juha.saukkonen@jamk.fi
Anastasiia Mikhlina, Education Coordinator, Jamk University of Applied Sciences, School of Business anastasiia.mikhlina@jamk.fi
References
Aulet, B. (2013). Disciplined Entrepreneurship: 24 Steps to a Successful Startup. ISBN: 978-1-118-72081-3
Cristina, P. R. U. N. D. (2021). Why Generation Z Is Redefining the HRM Processes. Studies in Business & Economics, 16(3).
Gartner (2019). Top 10 Strategic Technology Trends 2019. Garter IT symposium/XPO in Orlando, Florida. Retrieved from https://www.gartner.com/smarterwithgartner/gartner-top-10-strategic-technology-trends-for-2019
Klein, P. (2020). New Generations: Changing Values of Generation Y & Z. Impact on Today’s Organizations, Human Resource Management And Leadership. Doctoral Dissertation. University of Sopron, Hungary.
Mikhlina, A. (2021). Work-life Balance Expectations of Young Talents: Projections to the Year 2026. Bachelor’s Thesis, Jamk University of Applied Sciences, Finland
Minbaeva, D. (2020). Disrupted HR. Human Resource Management Review 31(4):100820