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A Human Capital Management Model to Optimize Resource Efficiency of Logistics &Supply Chain Management
Conference
Proceedings of the 2nd International Conference on Operations and Supply Chain Management
Publisher(s)
University of the Thai Chamber of Commerce
Date Issued
2007
Author(s)
Kattarwala, Nafisa Habilbhai
Abstract
Human Resources in any organization are perceived as acost to the organization and the Human Resource functionis perceived as a cost center, which needs to be monitoredstringently to deliver optimum value. This paper exploresthe context of Human Resources as the cost of capital tothe company in order to understand the repercussions ofhuman capital management which can not just help savecost but add to the bottom line in a more competent andfinancially accountable manner. A huge expense of theorganization is incurred on human resources and it isimperative that this organizational cost is not justoptimized to enhance human competencies but the humanresource be managed so that it is a financially strategictool to add value to the organization and to realign its corecompetencies to leverage upon the varying businessopportunities and to combat challenges morecompetitively. The traditional return on investment modelalways inevitably anticipated the returns on otherresources invested by an organization excludingmanpower, which was perhaps discounted because of itsintangible and inconsistent measurement and no meansavailable to establish its direct co-relation to theprofitability of the organization. It is high time thatorganizations seek to correct this and account for thehuman capital and measure the return on this investment.This paper will present a strategic perspective on thesignificance of measuring the cost of human capital inlogistics and supply chain management to create a morerobust organization, which is geared to deliver aperennially more market-driven and consistently adaptivehuman resource to build an organization which is bestsuitedto serve the customer and reinforce its owncapabilities to so as to have a greater return on investmentfor all human capital.This paper will explore the dimension of human resourcemapping and control through Human Capital Return OnInvestment to derive efficient cost-to-serve and valuebasedsystems in a highly competitive and dynamicbusiness environment such as logistics and supply chainmanagement. Often companies focus on impacting thebottom lines by optimizing the operational efficiencyrather than human efficiency. The cost of using IT or anyother strategic or systemic tool could be phenomenal to anorganization. This paper will provide an alternativestrategy to use the human resource cost of capitalapproach to optimize on manpower efficiency to driveorganizational growth and to develop a web of importanthuman competencies to remain flexible in a highly fastchangingenvironment and to deliver in the shortestpossible timelines. It is imperative that the intangible andthe unmapped human synergy and its direct repercussionson the organizational results are captured throughsystemic tools to enable decision-makers to use thehuman resources more effectively. This paper is anattempt to look at human resources management not as acost to the organization but as an investment which cancreate highly competitive &profitable logistics andsupply management systems and to move beyond theconservative view to contemplate human resourcesmanagement as a mere cost to a more transformationalperspective of using human resource as a strategicrevenue boosting resource. It proposes a model of HumanCapital Management to optimize the business values inlogistics &supply chain management and attempts toposition Human Resources Management as a strategicbusiness partner making it accountable for company’sfinancial results.
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Rights Holder(s)
University of the Thai Chamber of Commerce
Bibliographic Citation
Nafisa Habilbhai Kattarwala (2007) A Human Capital Management Model to Optimize Resource Efficiency of Logistics &Supply Chain Management.
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