“Employees Are Our Most Important Asset” It’s almost ubiquitous in corporate culture statements, but what does it really mean?

Financially, employees simply don’t show up on the balance sheet. On the income statement, employees are definitely an expense, often well over 50% for most service-oriented companies. So, in any accounting or financial sense, employees are simply not treated as assets.

Next, asset ownership. Companies own assets .They can buy assets, sell assets, and borrow against assets. Pretty difficult to do that with employees.

Finally, assets tend to have long lives. Real estate has a long life, patents last 17 years (or more); even inventory has a shelf life up to a year.

But companies treat employees just the opposite. Companies resist unionization, which creates long-term relationships with employees. Companies prefer “at will” agreements, which allow the company to terminate employee relationships with only two weeks notice. Is that long-term thinking?

Bluntly, most American companies simply do not treat employees as long-term assets. European companies are even worse. Due to government regulations limiting a company’s ability to terminate employees; most European companies go to extreme lengths to avoid hiring full-time employees.

Rather than working to acquire these human “assets,” they actively avoid them. Sounds like employees are treated more like liabilities than assets.

And in the US the concept of “employee as a liability” has certainly gained currency in the past ten years. Temporary employment, both full-time and part-time, has exploded. Outsourcing, both foreign and domestic, is simply one more way for companies to avoid acquiring employee liabilities.

While employees may be our “most important asset,” companies act as if employees are their greatest liability.

Does your organization claim that employees are its most important asset? How does it demonstrate that? Do your employees believe it? Let us know.

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This entry was posted on Tuesday, February 17th, 2009 at 5:30 am and is filed under Business info, Communication, Culture, Hiring, Motivation, Retention, Richard Barrett. You can follow any responses to this entry through the RSS 2.0 feed.
Tags: Culture, Employees Are Our Most Important Asset, HR policy, Richard Barrett
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