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The importance of labor is fundamentally recognized in all sectors of this busy world.
The proof is the establishment of the Personnel Department as past practice and the Office of Human Resource Management or the Office of Human Resource Development in recent trends.
This is true whether the organization or company is a public or private entity.
In the business world and even in educational institutions, seven important resources to consider are identified and given broad importance. These are called the “Seven Ms of Management.”
These include machines, labor, materials, messages, methods, minutes, and money.
Organizational resources
Machines are compared to modern technologies invented by men to facilitate the process of doing a particular job, for example a tractor for agriculture and a computer for office work are just a few examples.
The workforce are human beings who take care of the different jobs of the organization.
Materials are inputs that are used for the production of any activity carried out by the company.
Message refers to communication and the communication process used by the company.
Methods are the step-by-step routine in handling work, either manually or in these modern days, through automation.
The minutes refer to time, the usual basis for remunerating the production of labor for the exercise of their vocation or profession.
Finally, the money, the resources of the organization that have the purchasing power.
But, among the resources mentioned, labor is the most important asset of an organization because only men are the only living organisms while the other resources are inanimate beings.
Human capital
Why consider labor as human capital instead of human resources? This is due to the paradigm shift of considering labor. There are two perspectives on the workforce of organizations today, according to author Perfect Sison.
First, the old school of thought, the treatment for the workforce as it is hired in the company is: “Putting the right people with the right skills in the right jobs for the right cost at the right time.”
Second, the new school of thought, the company’s workforce is considered human capital and is treated in this way, “To place the right people with the right skills in the right roles that have added value at the moment suitable”.
The schools of thought described differences in the following aspects: “suitable skills versus suitable competencies”, “suitable jobs versus suitable roles” and “suitable cost versus added value”.
It seems that there are more opportunities and benefits for both the company and the workforce by treating labor as human capital rather than human resources.
According to Sison, “workers today act as commercial or capitalist establishments. Their capital is their capacity, behavior, effort and time that they contribute to the company. Like all free market capitalists, they, the workers, expect a healthy return on their investments.
He added that today, “workers are considered the lifeblood of the company and that the business enterprise cannot prosper much without human capital.”
Dr. Antonio G. Papa is a retired university professor in the Faculty of Economics, Management and Development Studies at Cavite State University in Indang, Cavite. In 2018, he served as a Scientist 1 and Consultant at Marinduque State College in Boac, Marinduque. He graduated from Master of Science and Doctor of Philosophy in extension education from the University of the Philippines Los Baños in Laguna in 1986 and 1991, respectively.
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