Job Design

Individual responses to jobs vary. A job may be motivating to one person but not to someone else. Also, depending on how jobs are designed, they may provide more or less opportunity for employees to satisfy their job-related needs. For example, a sales job may furnish a good opportunity to satisfy social needs, whereas a training assignment may satisfy a person’s need to be an expert in a certain area. A job that gives little latitude may not satisfy an individual’s need to be creative or innovative. Therefore, managers and employees alike are finding that understanding the characteristics of jobs requires broader perspectives than it did in the past. Designing or redesigning jobs encompasses many factors. Job design refers to organizing tasks, duties, and responsibilities into a productive unit of work. It involves the content of jobs and the effect of jobs on employees. Identifying the components of a given job is an integral part of job design. More attention is being paid to job design for three major reasons:

• Job design can influence performance in certain jobs, especially those where employee motivation can make a substantial difference. Lower costs through reduced turnover and absenteeism also are related to good job design.

• Job design can affect job satisfaction. Because people are more satisfied with certain job configurations than with others, it is important to be able to identify what makes a “good” job.

• Job design can affect both physical and mental health. Problems such as hearing loss, backache, and leg pain sometimes can be traced directly to job design, as can stress and related high blood pressure and heart disease.

Not everyone would be happy as a physician, as an engineer, or as a dishwasher. But certain people like and do well at each of those jobs. The person/job fit is a simple but important concept that involves matching characteristics of people with characteristics of jobs. Obviously, if a person does not fit a job, either the person can be changed or replaced, or the job can be altered. In the past, it was much more common to make the round person fit the square job. However, successfully “reshaping” people is not easy to do. By redesigning jobs, the person/job fit can be improved more easily. Jobs may be designed properly when they are first established or “reengineered” later.

Nature of Job Design

Identifying the components of a given job is an integral part of job design. Designing or redesigning jobs encompasses many factors, and a number of different techniques are available to the manager. Job design has been equated with job enrichment, a technique developed by Frederick Herzberg, but job design is much broader than job enrichment alone.

JOB ENLARGEMENT AND JOB ENRICHMENT

Attempts to alleviate some of the problems encountered in excessive job simplification fall under the general headings of job enlargement and job enrichment. Job enlargement involves broadening the scope of a job by expanding the number of different tasks to be performed. Job enrichment is increasing the depth of a job by adding responsibility for planning, organizing, controlling, and evaluating the job. A manager might enrich a job by promoting variety, requiring more skill and responsibility, providing more autonomy, and adding opportunities for personal growth. Giving an employee more planning and controlling responsibilities over the tasks to be done also enriches. However, simply adding more similar tasks does not enrich the job. Some examples of such actions that enrich a job include:

• Giving a person an entire job rather than just a piece of the work.

• Giving more freedom and authority so the employee can perform the job as he or she sees fit.

• Increasing a person’s accountability for work by reducing external control.

• Expanding assignments so employees can learn to do new tasks and develop new areas of expertise.

• Giving feedback reports directly to employees rather than to management only.

JOB ROTATION

The technique known as job rotation can be a way to break the monotony of an otherwise routine job with little scope by shifting a person from job to job. For example, one week on the auto assembly line, John Williams attaches doors to the rest of the body assembly. The next week he attaches bumpers. The third week he puts in seat assemblies, then rotates back to doors again the following week. Job rotation need not be done on a weekly basis. John could spend one-third of a day on each job or one entire day, instead of a week, on each job. It has been argued, however, that rotation does little in the long run to solve the problem of employee boredom. Rotating a person from one boring job to another may help somewhat initially, but the jobs are still perceived to be boring. The advantage is that job rotation does develop an employee who can do many different jobs.

Job Characteristics

The job-characteristics model by Hackman and Oldham identifies five important design characteristics of jobs. Figure 3—6 shows that skill variety, task identity, and task significance affect meaningfulness of work. Autonomy stimulates responsibility, and feedback provides knowledge of results. Following is a description of each characteristic.

SKILL VARIETY The extent to which the work requires several different activities for successful completion indicates its skill variety. For example, low skill variety exists when an assembly-line worker performs the same two tasks repetitively. The more skills involved, the more meaningful the work. Skill variety can be enhanced in several ways. Job rotation can break the monotony of an otherwise routine job with little scope by shifting a person from job to job. Job enlargement may as well.

TASK IDENTITY The extent to which the job includes a “whole” identifiable unit of work that is carried out from start to finish and that results in a visible outcome is its task identity. For example, one corporation changed its customer
service processes so that when a customer calls with a problem, one employee, called a Customer Care Advocate, handles most or all facets of the problem from maintenance to repair. As a result, more than 40% of customer problems are resolved by one person while the customer is still on the line. Previously, less than


1% of the customer problems were resolved immediately because the customer service representative had to complete paperwork and forward it to operations, which then followed a number of separate steps using different people to resolve problems. In the current system, the Customer Care Advocate can identify more closely with solving a customer’s problem.

TASK SIGNIFICANCE The amount of impact the job has on other people indicates its task significance. A job is more meaningful if it is important to other people for some reason. For instance, a soldier may experience more fulfillment when defending his or her country from a real threat than when merely training to stay ready in case such a threat arises. In the earlier example, the Customer Care Advocate’s task has significance because it affects customers considerably.

AUTONOMY The extent of individual freedom and discretion in the work and its scheduling indicates autonomy. More autonomy leads to a greater feeling of personal responsibility for the work. Efforts to increase autonomy may lead to what was characterized as job enrichment by Frederick Herzberg. Examples of actions that increase autonomy include giving more freedom and authority so the employee can perform the job as he or she sees fit and increasing an employee’s accountability for work by reducing external control.


FEEDBACK The amount of information employees receive about how well or how poorly they have performed is feedback. The advantage of feedback is that it helps employees to understand the effectiveness of their performance and contributes to their overall knowledge about the work. At one firm, feedback reports from customers who contact the company with problems are given directly to the employees who handle the customers’ complaints, instead of being given only to the department manager.

Consequences of Job Design

Jobs designed to take advantage of these important job characteristics are more likely to be positively received by employees. Such characteristics help distinguish between “good” and “bad” jobs. Many approaches to enhancing productivity and quality reflect efforts to expand some of the job characteristics. Because of the effects of job design on performance, employee satisfaction, health, and many other factors, many organizations are changing or have already changed the design of some jobs. A broader approach is reengineering work and jobs.

source by Human Resource Management 9th Edition Robert L. Mathis John H

Individual Motivation

The performance that employers look for in individuals rests on ability, motivation, and the support individuals receive; however, motivation is often the missing variable. Motivation is the desire within a person causing that person to act. People usually act for one reason: to reach a goal. Thus, motivation is a goal directed drive, and it seldom occurs in a void. The words need, want, desire, and drive are all similar to motive, from which the word motivation is derived. Understanding motivation is important because performance, reaction to compensation, and other HR concerns are related to motivation. Approaches to understanding motivation differ because many individual theorists have developed their own views and theories. They approach motivation from different starting points, with different ideas in mind, and from different backgrounds. No one approach is considered to be the “ultimate.” Each approach has contributed to the understanding of human motivation.

Content Theories of Motivation

Content theories of motivation are concerned with the needs that people are attempting to satisfy. The most well-known theories are highlighted briefly next.

MASLOW’S HIERARCHY OF NEEDS

One theory of human motivation that has received a great deal of exposure in the past was developed by Abraham Maslow. In this theory, Maslow classified human needs into five categories that ascend in a definite order. Until the more basic needs are adequately fulfilled, a person will not strive to meet higher needs. Maslow’s well-known hierarchy is composed of (1) physiological needs, (2) safety and security needs, (3) belonging and love needs, (4) esteem needs, and (5) self-actualization needs. An assumption often made by those using Maslow’s hierarchy is that workers in modern, technologically advanced societies basically have satisfied their physiological, safety, and belonging needs. Therefore, they will be motivated by the needs for self-esteem, esteem of others, and then self-actualization. Consequently, conditions to satisfy these needs should be present at work; the job it self should be meaningful and motivating.

HERZBERG’S MOTIVATION/HYGIENE THEORY

Frederick Herzberg’s motivation/hygiene theory assumes that one group of factors, motivators, accounts for high levels of motivation. Another group of factors, hygiene, or maintenance factors, can cause discontent with work. Figure 3—4 compares Herzberg’s motivators and hygiene factors with Maslow’s needs of hierarchy. The implication of Herzberg’s research for management and HR practices is that although managers must carefully consider hygiene factors in order to avoid employee dissatisfaction, even if all these maintenance needs are addressed, people may not be motivated to work harder. Only motivators cause employees to exert more effort and thereby attain more productivity, and this theory suggests that managers should utilize the motivators as tools to enhance employee performance.


Process Theories of Motivation

Process theories suggest that a variety of factors may prove to be motivating, depending on the needs of the individual, the situation the individual is in, and the rewards the individual expects for the work done. Theorists who hold to this view do not attempt to fit people into a single category, but rather accept human differences. One process theory by Lyman Porter and E.E. Lawler focuses on the value a person places on a goal as well as the person’s perceptions of workplace equity, or fairness, as factors that influence his or her job behavior. In a work situation, perception is the way an individual views the job. Figure 3—5 contains a simplified Porter and Lawler model, which indicates that motivation is influenced by people’s expectations. If expectations are not met, people may feel that they have been unfairly treated and consequently become dissatisfied.

Using the Porter and Lawler model, suppose that a salesclerk is motivated to expend effort on her job. From this job she expects to receive two types of rewards: intrinsic (internal) and extrinsic (external). For this salesclerk, intrinsic rewards could include a feeling of accomplishment, a feeling of recognition, or other motivators. Extrinsic rewards might be such items as pay, benefits, good working conditions, and other hygiene factors. The salesclerk compares her performance with what she expected and evaluates it in light of both types of rewards she receives. She then reaches some level of job satisfaction or dissatisfaction. Once this level is reached, it is difficult to determine what she will do. If she is dissatisfied, she might put forth less effort in the future, she might


work harder to get the rewards she wants, or she might just accept her dissatisfaction. If she is highly satisfied, it does not always mean she will work harder. She may even slack off a bit, saying, “I got what I wanted.” The essence of the Porter and Lawler view of motivation is perception. In addition, as the feedback loop in Figure 3—5 indicates, performance leads to satisfaction rather than satisfaction leading to performance.

source by Human Resource Management 9th Edition Robert L. Mathis John H

Organizational Strategy and Human Resources

The development of specific business strategies must be based on the areas of strength that an organization has. Referred to as core competencies by Hamel and Prahalad, they are the foundation for creating the competitive advantage for an organization. A core competency is a unique capability in the organization that creates high value and that differentiates the organization from its competition.

Human Resources as a Core Competency

Certainly, many organizations have voiced the idea that their human resources differentiate them from their competitors. Organizations as widely diverse as Federal Express, Nordstrom’s Department Stores, and Gateway Computers have focused on human resources as having special strategic value for the organization. The significance of human resources as a core competency

was confirmed in a study of 293 U.S. firms. The study found that HR management effectiveness positively affected organizational productivity, financial performance, and stock market value. Some ways that human resources become a core competency are through attracting and retaining employees with unique professional and technical capabilities, investing in training and development of those employees, and compensating them in ways that keep them competitive with their counterparts in other organizations. The value of human resources was demonstrated several years ago, when United Parcel Service workers went on strike. In offices around the country, customers had concerns that the brown-shirted UPS drivers, whom customers often knew by their first names, were not working. Fortunately for UPS, its drivers, and their customers, the strike was settled relatively quickly. Another illustration is what happened in the banking industry with the many mergers and acquisitions. Smaller, community-oriented banks have picked up numerous small- and medium-sized commercial loan customers because they emphasize that “you can talk to the same person,” rather than having to call an automated service center in another state.Resource-Based Organizational Strategies

There has been growing recognition that human resources contribute to sustaining a competitive advantage for organizations. Jay Barney and others have focused on four factors that are important to organizational strategic accomplishments.4 Those factors, called the VRIO framework, are related to human resources as follows:

• Value: Human resources that can create value are those that can respond to external threats and opportunities. Having this ability means that employees can make decisions and be innovative when faced with environmental changes.

• Rareness: The special capabilities of people in the organization provide it significant advantages. Especially important is that the human resources in an organization be provided training and development to enhance their capabilities, so that they are continually seen as “the best” by customers and industry colleagues. This rareness also helps in attracting and retaining employees with scarce and unique knowledge, skills, and abilities. Reducing employee turnover is certainly important in preserving the rareness of human resources.

• Imitability: Human resources have a special strategic value when they cannot be easily imitated by others. Southwest Airlines, Disney, and Marriott Corporation each have created images with customers and competitors that they are different and better at customer service. Any competitors trying to copy the HR management “culture” created in these organizations would have to significantly change many organizational and HR aspects.

• Organization: The human resources must be organized in order for an entity to take advantage of the competitive advantages just noted. This means that the human resources must be able to work effectively together, and have HR policies and programs managed in ways that support the people working in the organization.

Using a VRIO framework as the foundation for HR management means that people are truly seen as assets, not as expenses. It also means that the culture of organizations must be considered when developing organizational and HR strategies.

Organizational Culture and HR Strategy

Organizational culture is a pattern of shared values and beliefs giving members of an organization meaning and providing them with rules for behavior. These values are inherent in the ways organizations and their members view themselves, define opportunities, and plan strategies. Much as personality shapes an individual, organizational culture shapes its members’ responses and defines what an organization can or is willing to do.

The culture of an organization is seen in the norms of expected behaviors, values, philosophies, rituals, and symbols used by its employees. Culture evolves over a period of time. Only if an organization has a history in which people have shared experiences for years does a culture stabilize. A relatively new firm, such as a business existing for less than two years, probably has not developed a stabilized culture.

Managers must consider the culture of the organization because otherwise excellent strategies can be negated by a culture that is incompatible with the strategies. Further, it is the culture of the organization, as viewed by the people in it, that affects the attraction and retention of competent employees.5 Numerous examples can be given of key technical, professional, and administrative employees leaving firms because of corporate cultures that seem to devalue people and create barriers to the use of individual capabilities. In contrast, by creating a culture that values people highly, some corporations have been very successful at attracting, training, and retaining former welfare recipients.

The culture of an organization also affects the way external forces are viewed. In one culture, external events are seen as threatening, whereas another culture views risks and changes as challenges requiring immediate responses. The latter type of culture can be a source of competitive advantage, especially if it is unique and hard to duplicate. This is especially true as an organization evolves through the life cycle in an industry.

Linking Organizational Strategies and HR Plans

Strategic planning must include planning for human resources to carry out the rest of the plan. Figure 2—3 shows the relationship among the variables that


ultimately determine the HR plans an organization will develop. Business strategy affects strategies and activities in the HR area. For example, several years ago, a large bank began planning to become one of the top financial institutions in the country. Two parts of its strategic plan were (1) to adopt a global focus and (2) to improve service. HR plans to support global goals included integrating compensation and benefits systems and hiring policies for international operations and domestic operations. Service improvement plans hinged on well trained, capable first-level employees. But an HR diagnosis turned up basic skills deficiencies in employees. As a result of HR planning, a series of programs designed to remedy basic skills problems in the workforce was developed. The coordination of company-wide strategic planning and strategic HR planning was successful in this case because HR plans supported corporate strategic plans.

The cost-leadership strategy requires an organization to “build” its own employees to fit its specialized needs. This approach requires a longer HR planning horizon. When specific skills are found to be needed for a new market or product, it may be more difficult to internally develop them quickly. However, with a differentiation strategy, responsiveness means that HR planning is likely to have a shorter time frame, and greater use of external sources will be used to staff the organization. The HR Perspective discusses a study that examined the involvement of HR executives when determining organizational strategies and core competencies.

source by Human Resource Management 9th Edition Robert L. Mathis John H

Human Resource Planning

The competitive organizational strategy of the firm as a whole becomes the basis for human resource (HR) planning, which is the process of analyzing and identifying the need for and availability of human resources so that the organization can meet its objectives. This section discusses HR planning responsibilities, the importance of HR planning in small and entrepreneurial organizations, and the HR planning process.

HR Planning Responsibilities

In most organizations that do HR planning, the top HR executive and subordinate staff specialists have most of the responsibilities for this planning. However, other managers must provide data for the HR specialists to analyze. In turn, those managers need to receive data from the HR unit. Because top managers are responsible for overall strategic planning, they usually ask the HR unit to project the human resources needed to implement overall organizational goals.

HR Planning in Evolving Small and Entrepreneurial Organizations

HR management and ultimately HR planning are critical in small and entrepreneurial organizations. “People problems” are among the most frustrating ones faced by small-business owners and entrepreneurs.

EVOLUTION OF HR ACTIVITIES

At the beginning of a small business’s existence, only very basic HR activities must be performed. Compensation and government mandated benefits must be paid. As the organization evolves, more employees must be recruited and selected. Also, some orientation and on-the-job training are necessary, though they are often done haphazardly. The evolution of the business proceeds through several stages. The focus of each stage reflects the needs of the organization at the time. In the initial stage, the organization first hires an HR clerk, then possibly an HR administrator. As the organization grows, it may add more HR professionals, often including an employment or benefits specialist. With further growth, other specialists, such as trainers, may be needed. From this point, additional clerical and specialist employees can be added, and separate functional departments (employment, compensation, benefits, and training) can evolve.

SMALL BUSINESS AND FAMILY ISSUES

One factor often affecting the planning of HR activities in small firms is family considerations. Particular difficulties arise when a growing business is passed on from one generation to another, resulting in a mix of family and non family employees. Some family members may use employees as “pawns” in disagreements with other family members in the firm. Also, non family employees may see different HR policies and rules being used for family members than for them. Key to the successful transition of a business from one generation to another is having a clearly identified HR plan. Crucial in small businesses is incorporating the role of key nonfamily members with HR planning efforts. Often, non family members have important capabilities and expertise that family members do not possess. Therefore, planning for the attraction and retention of these “outsiders” may be vital to the future success of smaller organizations. One survey of over 3,000 small businesses found that management succession was one of the top challenges faced by family-owned firms.

It even may be that the non family members will assume top management leadership roles, with some or all family members who are owners serving on the Board of Directors, but not being active managers in the firm. Additionally, non family executives may be the intermediaries who focus on the needs of the business when family member conflicts arise. Small businesses, depending on how small they are, may use the HR planning that follows, but in very small organizations the process is much more intuitive and often done entirely by the top executives, who often are family members.

HR Planning Process

Notice that the HR planning process begins with considering the organizational objectives and strategies. Then both external and internal assessments of HR needs and supply sources must be done and forecasts developed. Key to assessing internal human resources is having solid information, which is accessible through a human resource information system (HRIS). Once the assessments are complete, forecasts must be developed to identify the mismatch between HR supply and HR demand. HR strategies and plans to address the imbalance, both short and long term, must be developed. HR strategies are the means used to aid the organization in anticipating and managing the supply and demand for human resources. These HR strategies provide overall direction for how HR activities will be developed and managed. Finally, specific HR plans are developed to provide more specific direction for the management of HR activities.

DEVELOPING THE HR PLAN

The HR plan must be guided by longer-term plans. For example, in planning for human resources, an organization must consider the allocation of people to jobs over long periods of time—not just for the next month or even the next year. This allocation requires knowledge of any foreseen expansions or reductions in operations and any technological changes that may affect the organization. On the basis of such analyses, plans can be made for shifting employees within the organization, laying off or otherwise cutting back the number of employees, or retraining present employees. Factors to consider include the current level of employee knowledge, skills, and abilities in an organization and the expected vacancies resulting from retirement, promotion, transfer, sick leave, or discharge.

In summary, the HR plan provides a road map for the future, identifying where employees are likely to be obtained, when employees will be needed, and what training and development employees must have. Through succession planning, employee career paths can be tailored to individual needs that are consistent with organizational requirements. Further, the compensation system has to fit with the performance appraisal system, which must fit with HR development decisions, and so on. In summary, the different HR activities must be aligned with the general business strategy, as well as the overall HR strategy, in order to support business goals.

EVALUATING HR PLANNING

If HR planning is done well, the following benefits should result: l Upper management has a better view of the human resource dimensions of business decisions. l HR costs may be lower because management can anticipate imbalances before they become unmanageable and expensive. l More time is available to locate talent because needs are anticipated and identified before the actual staffing is required. l Better opportunities exist to include women and minority groups in future growth plans. l Development of managers can be better planned. To the extent that these results can be measured, they can form the basis for evaluating the success of HR planning. Another approach is to measure projected levels of demand against actual levels at some point in the future. But the most telling evidence of successful HR planning is an organization in which the human resources are consistently aligned with the needs of the business over a period of time.

source by Human Resource Management 9th Edition Robert L. Mathis John H

Corporation

A corporation is a legal entity separate from the persons that form it. It is a legal entity owned by individual stockholders. In British tradition it is the term designating a body corporate, where it can be either a corporation sole (an office held by an individual natural person, which is a legal entity separate from that person) or a corporation aggregate (involving more persons). In American and, increasingly, international usage, the term denotes a body corporate formed to conduct business, and this meaning of corporation is discussed in the remaining part of this entry (the limited company in British usage).

Corporations exist as a product of corporate law, and their rules balance the interests of the shareholders that invest their capital and the employees who contribute their labor. People work together in corporations to produce value and generate income. In modern times, corporations have become an increasingly dominant part of economic life. People rely on corporations for employment, for their goods and services, for the value of the pensions, for economic growth and social development.

The defining feature of a corporation is its legal independence from the people who create it. If a corporation fails, shareholders normally only stand to lose their investment (and possibly, in the unusual case where the shares are not fully paid up, any amount outstanding on them - and not even that in the case of a No liability company), and employees will lose their jobs, but neither will be further liable for debts that remain owing to the corporation's creditors unless they have separately varied this, e.g. with personal guarantees. This rule is called limited liability, and it is why the names of corporations in the UK end with "Ltd." (or some variant like "Inc." and "plc").

Despite not being natural persons, corporations are recognized by the law to have rights and responsibilities like actual people. Corporations can exercise human rights against real individuals and the state,and they may be responsible for human rights violations. Just as they are "born" into existence through its members obtaining a certificate of incorporation, they can "die" when they lose money into insolvency. Corporations can even be convicted of criminal offences, such as fraud and manslaughter. Five common characteristics of the modern corporation, according to Harvard University Professors Hansmann and Kraakman are...

• delegated management, in other words, control of the company placed in the hands of a board of directors
• limited liability of the shareholders (so that when the company is insolvent, they only owe the money that they subscribed for in shares)
• investor ownership, which Hansmann and Kraakman take to mean, ownership by shareholders.
• separate legal personality of the corporation (the right to sue and be sued in its own name)
• transferrable shares (usually on a listed exchange, such as the London Stock Exchange, New York Stock Exchange or Euronext in Paris).

Ownership of a corporation is complicated by increasing social and economic interdependence, as different stakeholders compete to have a say in corporate affairs. In most developed countries excluding the English speaking world, company boards have representatives of both shareholders and employees to "codetermine" company strategy. Calls for increasing corporate social responsibility are made by consumer, environmental and human rights activists, and this has led to larger corporations drawing up codes of conduct. In Australia, Canada, the United Kingdom and the United States, corporate law has not yet stepped into that field, and its building blocks remain the study of corporate governance and corporate finance.

Human Resources

Human resources is a term with which some organizations describe the combination of traditionally administrative personnel functions with performance, Employee Relations and resource planning. The field draws upon concepts developed in Industrial/Organizational Psychology. Human resources has at least two related interpretations depending on context. The original usage derives from political economy and economics, where it was traditionally called labor, one of four factors of production.

The more common usage within corporations and businesses refers to the individuals within the firm, and to the portion of the firm's organization that deals with hiring, firing, training, and other personnel issues. This article addresses both definitions.

The objective of human resources is to maximize the return on investment from the organization's human capital and minimize financial risk. It is the responsibility of human resource managers to conduct these activities in an effective, legal, fair, and consistent manner.

Human resource management serves these key functions:

· Selection

· Training and Development

· Performance Evaluation and Management

· Promotions

· Redundancy

· Industrial and Employee Relations

· Record keeping of all personal data.

· Compensation, pensions, bonuses etc in liaison with Payroll

· Confidential advice to internal 'customers' in relation to problems at work

· Career development

Modern analysis emphasizes that human beings are not "commodities" or "resources", but are creative and social beings in a productive enterprise. The 2000 revision of ISO 9001 in contrast requires to identify the processes, their sequence and interaction, and to define and communicate responsibilities and authorities. In general, heavily unionized nations such as France and Germany have adopted and encouraged such job descriptions especially within trade unions. One view of this trend is that a strong social consensus on political economy and a good social welfare system facilitates labor mobility and tends to make the entire economy more productive, as labor can move from one enterprise to another with little controversy or difficulty in adapting.

An important controversy regarding labor mobility illustrates the broader philosophical issue with usage of the phrase "human resources": governments of developing nations often regard developed nations that encourage immigration or "guest workers" as appropriating human capital that is rightfully part of the developing nation and required to further its growth as a civilization. They argue that this appropriation is similar to colonial commodity fiat wherein a colonizing European power would define an arbitrary price for natural resources, extracting which diminished national natural capital.

The debate regarding "human resources" versus human capital thus in many ways echoes the debate regarding natural resources versus natural capital. Over time the United Nations have come to more generally support the developing nations' point of view, and have requested significant offsetting "foreign aid" contributions so that a developing nation losing human capital does not lose the capacity to continue to train new people in trades, professions, and the arts.

An extreme version of this view is that historical inequities such as African slavery must be compensated by current developed nations, which benefited from stolen "human resources" as they were developing. This is an extremely controversial view, but it echoes the general theme of converting human capital to "human resources" and thus greatly diminishing its value to the host society, i.e. "Africa", as it is put to narrow imitative use as "labor" in the using society.

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