The Systems Thinking Approach of Human Capital Management Dr Wynand Goosen Infomage Rims Group

By drwynandgoosen, 22 July, 2013
  1. Development of a HR Strategy


The development of an effective human capital management strategy, using a systems thinking approach requires the executive to understand the interaction and roles of all components of the total HR system, as well as the business systems and their operational requirements. The effective HR executive will function on an awareness level that understand the balance between needs from operations, staff and strategic imperatives such as equity and BBBEE. This requires understanding of how the total “engine” functions as opposed to being a specialist in a certain field. For this reason effective systems thinkers are specialist in Human Capital Management as opposed to simply human resources.


In order to formulate an effective strategy for Human Capital (HC), the systems thinker will analyse the Organisational Strategic Plan (OSP) in detail, so as to develop a system of required HC. From the OSP the vision, mission and objectives should literally be “unpacked” and concepts formed as if it were a type of grounded theory research project. Identifying the broad tasks that would be required to fulfill the OSP should do this. These broad tasks form the conceptual framework of delivery, from where categories of required human capital (RHC) should be clustered, as the tasks or activities that would be needed to bring about the required actions of the OSP. This in turn should now be tested against the existing job descriptions, and such job descriptions should be reviewed, including creating new ones and scarping ones that may not satisfy the requirements.  


Only once the required human capital base is defined, do we start looking at the incumbents of existing jobs. This study implies a consideration of the “actual human capital” (AHC) of the organisation. By comparing the AHC to RHC, we will establish the skills gap – the shortcoming of achieving our OSP. However, the risk here is to NOT look at the results too mechanically. AHC should also include a potential analysis of whom, how and what we could do to rectify the skills gap. Various methods can be applied – Training, on the job coaching and even counseling can be used.

 2.Recruitment & Selection


Effective recruitment & selection is dependent on a few factors such as:

  • Clear definition of what is required
  • Effective selection of potential candidates
  • Effective, broad based interviewing skills
  • Compatibility analysis
  • Motivation levels and mental and learning agility 


It is very important to understand how a person will fit into a team. Sensitivities surrounding office politics need to be considered. Sometimes it could be an effective strategy to introduce an individual with opposing views to a team. Conflict management would be needed but progress could be driven with diversity management skills for managers.


ACH and RHC are primary factors to consider when determining the recruitment & selection strategy.

3. People Development


People development should also be driven on an integrated system. During job design, the Key Performance Indicators (KPI) should be aligned were possible, to known educational benchmarks. Performance management should, in the same vain, record actual outputs and competencies in a digital format that serves the needs of the organisation, but also facilitates the creation of a portfolio of competency for the employee. This will enable the employee to use such “evidence” towards an RPL activity for the attainment of formal qualifications or as CPD points in obtaining professional designations or maintaining such.


The PD strategy should however, not rest on just performance management, but ought to include training, on the job coaching and also, self-development. Each employee should be given access to a digital system to create and self-monitor, a Personal Development Plan (PDP) that could enable personal growth, career growth, RPL, CPD and designation management.


4. Organisational Design


From the human capital perspective, organisational design should be a function of strategic objectives, AHC and RHC. Management should have a clear understanding of what is realistic and pursue objectives accordingly. Unrealistically high expectations lead to as much disappointment as it’s opposite. OD should focus highly on integrated systems thinking. In this regard a type of Corporate Qualifications Framework (CQF) is required. The CQF should sever as a detailed organogram where the job descriptions, performance and career management functions as an integrated and dynamic system. The demands on IT systems must not be ignored as design and clear thinking of required information would have to be carefully spec’d.

5. Employment Relations


Effective employee relations have a high degree of compliance requirements in order to protect the right of the employer. Such includes clear guidance in terms of job descriptions, working hours, leave and other factors such the QMS and contracts. These factors need to be researched in the organisation and a compliance and risk management policy developed.


However, as part of such a compliance approach, effective human relations ought to also be brought into play. Much of staff conflicts can be avoided with the development of the correct organisational culture. The elements of culture can be developed with the aid of a code of conduct and the establishment of an ethics system.



Remuneration should be considered as more than just financial. Effective remuneration strategies include the following:


  • Market related financial reward.
  • Incentive systems
  • Non financial rewards
  • Recognition systems
  • Staff profiling
  • Team building
  • Development of a learning organisation culture
  • Competition systems
  • Development of a stimulating, respectful culture
  • Create a diverse but transparent team
  • Measuring achievement and staff guidance to growth

7. HR Admin & info Systems


HR Admin systems have, in the past, only recorded information that was controlled from an HR point. The individual would have at best, very limited insight to his file. This approach should and could be changed to allow for an element of self-management in the future. With the advent of the ability for employers and employees to co-manage an employee profile was created. Effectively an employee has a HR file that could now be “tagged” to a company. Should the employee change jobs the individual file could be moved between employers? Of course, employers could hold proprietary data that would fall outside of such a function.



Transformation is often mistakenly seen as bringing more black people on board. However, if this is the intent the organisation may find itself in trouble very soon. Transformation should include the development of a mentality or a strive amongst the workforce towards a more sensible value system, as a precursor to creation of an effective, learning organisation culture:


  • Change mindsets towards a non racial, non gender bias culture
  • Introduce a value of productivity
  • Create a system of self drive
  • Create “decent work” opportunities
  • Raised awareness levels
  • Internal locus of control environments


However, there are specific elements that would also need to be set as objectives:


8.1 Equity


Equity would not happen by itself. Care must be given not to repeat the mistakes of the past though. Appointing a person based on gender or race is fundamentally wrong, and in time to come the South African population would fully realize this.  For this reason, effective recruitment and development programmes should create equity. The introduction of Management Advancement Programmes for Women, should for example, be a programme to consider. In addition, an internship program aimed at identifying and developing young talent could be developed along equity lines.


8.2 Capacitate staff


As mentioned above, much could be done for staff capacitation. To recap the following items are important:


  • Education
  • Training
  • On the Job training
  • On the Job evidence collection
  • Performance management
  • Regular feedback



8.3 Information & Communication Technology


Information systems need to be flexible and allow for a component of input to come from the individual. Data requirements must be identified upfront and systems designed accordingly.


9. Creating a Centre of excellence


The above overview is by no means exhaustive on the development of an effective Human capital strategy and will in itself, require considerable investment in time and expertise to unpack, distill, explode and refine into a system that is agile and mutually beneficial for employer and employee. However, we believe that excellence is created by doing the right things well, and attempted to highlight a few of these in the above process.


10. Summary


Effective human capital management is not a stagnant, but a dynamic fractal that changes with new elements added every day. The effective Human Capital Executive is an individual that is aware of this constant change and comfortable with driving its dynamics, even capitalising on them. The reality of the 2013 is that human information now more than doubles in less than 30 days. So it is not what we know that matters so much, but how we act and react to out environment. How we influence our reality. It is not even about dealing with what happens to you. It is about how you happen to the reality. Business is dynamic and becoming more complex every day. The talent of the future is to create systems to de-complicate matters.


A clever person takes an ordinary concept and makes it complicated in an attempt to display a superior intellect, but a genius takes a complicated concept, and makes it simple.



Dr Wynand Goosen

CEO Infomage Rims Group

011 886 2727





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