An Investment Perspective in Human Resources

Human assets are equally important to that of fixed and current assets of the organization. People or Employees are often referred as Human assets because they add value to the investment decisions of the organization. When organizations recognize the value of human resources, it drives the organization towards success increasing the efficiency and productive capacity of the organization. Today, the skills and dexterity of employees has becomes a strong source for sustaining a competitive advantage over other rivalry. CEOs of organizations must believe in Employees are a knowledge base and should be ready to invest in developing them when the time comes depending of the need of the organization and these trainings and inductions will definitely will become a sense of motivation for them in near future. Many employees are motivated when they really know the exact know-how at workplace which comes with proper trainings.

Effective employees should be retained in the companies using different retention strategies which needs to be implemented by the strategic management. These retention strategies could include better pay, bonuses, more flexibility at work, holidays etc. Sometimes retention strategies becomes a must to regain the investment costs done on their development , to make them learn and to grow. We often find Investment-oriented organizations towards human assets which becomes central part of management philosophy and organization culture.

The challenges we see every in investments to human assets are increasing. One of the biggest challenge is that employees retaining becomes a difficult task for the organizations due to open market job opportunities and friction in the job market. It becomes a sunk costs for the firms and companies since the "ownership" of these skills solely belongs the employee but not with employer. 

Therefore, we may need to have a check on the economic costs of investments in Human Resources since today's world heavily replace the labor with technology. The future question for any CEO to think will be now, shall we invest in technology or human?