The difference between people and resources

I went to university with a scholarship from Hewlett Packard. Actually everyone on the course I was on had to have a scholarship to be part of the course. It was a course setup by a consortium of industry leading computing companies to fill a need they had for people who were specifically trained for roles in their industry. If I remember correctly the sponsors were IBM, HP, DEC, Data General, Wang and a couple of other names. Of these only a couple of those trade names are still in existence, with the others being consumed in mergers and acquisitions.

Bill Hewlett and Dave Packard
The founders of HP

As part of the course we all spent time (time that on every other university course was vacation), going to large corporate training centers and taking courses in such exoteric subjects as x25 configurations, system 360 basics , sales methodology and troubleshooting skills, among others.

Dr An Wang
The founder of Wang Labs

It was a major investment, and one that was a win, win for the corporations and the students. When we graduated, I believe virtually every graduating student got offered a position with either their sponsoring company or one of the other companies on the course.

I look back at that program and think it showed a level of corporate responsibility that is missing from the world today. Instead of training people, companies look to hire pre-trained candidates. And as a previous blog Business Shoot Thyself pointed out, this is a silly situation where the overall quality of candidates goes down over time, as the pool of knowledge is not enhanced.

The key to me was that companies recognized that spending the time to train new employees while costly ensured that a business was able to keep and grow its culture. When you fail to spend that time and effort to help new employees understand why a business has been and continues to be successful, then in fact you are rolling the dice every round of employment. Will the good ideas of the past be remembered?

The issue is exacerbated when after a few years those previous new hires then go out and hire for themselves. They are likely to continue to treat the next round of employees just as they were treated.

The concept can be seen very simply as follows:

When a new business is formed, the founders have a deep passion for their business, and they have the desire to instill this passion in those they hire.

James Watson
The founder of IBM

But when a business gets some distance from the founders, often that passion is diluted and it is not passed onto new hires.

The result is that where founders hire people, those without passion for their business hire resources.

How can you tell when this happens? I’ve read quite a few papers from places like the HBR that try and but a business size or revenue number on this tipping point. I’d suggest the answer is much simpler.

If everyone in the business cannot answer one simple question, then the business has moved from hiring People to hiring resources, and this one question is:

“What business are we truly in”.

If the answer is we are in the business of making money, it’s too late, but if the answer is along the lines of “we’re in the business of solving problem x, or making people feel good” then the business has a healthy dose of passion in its blood.

Companies that know why they exist, and see profit as just one of the results of doing what they are passionate about as opposed to the only goal will be around for many decades or longer and will inspire and improve the world.

While those who focus on resource management as a way of maximizing profit are going to merge and acquire their way into homogeneity.
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