On people

Assets or resources?

The trillion dollar problem nobody acknowledges

According to research firm, Gallup, employee disengagement in 2025 cost the global economy ten trillion dollars, with only one in five of all employees feeling engaged at work.  That results in approximately one hundred billion hours of wasted human potential per week, or half a quadrillion hours per year. And of course there is the societal impact of the associated misery seeping through the factory walls.

As you will read, the solution is obvious. It boils down to whether we treat people as resources or assets. Are we trying to get the best from our people or the most?

if global conference agendas are anything to go by, this is clearly not of great interest to the HR community. But the blame sits both higher and deeper, as we will see.

Assets and resources defined

An asset is something that delivers value by virtue of ownership. Like property, it’s value may simply rise over time. It might also actively generate value, eg. rental revenue. The aim is to maximise the return. This requires preservation of the asset.

A resource is something that delivers value but at the cost of the resource. Cars eventually cease to perform. That mountain of cement no longer exists because it was used to create a flyover. The aim is zero waste. The cement is gone.

Resource reality

From a scientific management perspective the role of the worker has evolved, at least theoretically:

• Early 1900s - Worker as cog in the machine - Frederick W. Taylor

• Circa 1920 - Worker as a social cog in the machine, aka organisational behaviour – Elton Mayo

• Circa 1950 – Worker as a self-motivated cog in the machine – Abraham Maslow et al

• Circa 1970 – Worker as an autonomous, creative thinker, aka knowledge worker – Peter Drucker.

Even if we imagine this to reflect a linear change, one would expect, half a century later, that organisations would be swelled with self-actualising intrapreneurs who race to work in their quest for self-mastery.

Unfortunately the train stopped one station short of Peter Drucker. Managerial science and the business schools need to explain why this is so.                

One could argue that from a business perspective treating people abhorrently could be considered a means to an end if it increased the value of the business. But it is clear that treating people poorly is, to put it mildly, a failure of corporate governance.

Here are some high-profile examples:

• Amazon – Relentless performance pressure, internal competition and burnout-inducing expectations. Impact: Psychological safety eroded, long-term thinking impaired and a global debate sparked about the sustainability of high-performance cultures.

• Uber – Aggressive ‘win at all costs’ culture characterised by harassment, intimidation and toxic internal dynamics. Impact: Lawsuits, investigations, reputational damage and the departure of senior leadership.

• Wells Fargo – Unrealistic sales targets and distorted incentives pressured employees into unethical behaviour. Impact: Millions of fraudulent accounts, regulatory penalties and a major loss of public trust.

  
  

• Boeing – Commercial pressures increasingly outweighed engineering judgement, making it difficult for concerns to be raised. Impact: Catastrophic safety failures, loss of life, regulatory scrutiny and severe reputational damage.

  
  

• Volkswagen – A culture where challenging authority was difficult and performance expectations encouraged manipulation over transparency. Impact: Deliberate emissions cheating, billions in fines and lasting brand damage.

  
  

• Enron – Ruthless employee ranking systems fostered internal competition and discouraged collaboration and truth-telling. Impact: Organisational collapse, massive job losses and one of the largest corporate scandals in history.

  
  

• British Post Office – Frontline workers were blamed and punished whilst management trusted systems and processes over human testimony. Impact: Wrongful prosecutions, destroyed lives and a profound loss of institutional credibility.

  
  

• NHS England – Bureaucratic targets and administrative priorities became disconnected from frontline reality. Impact: Poor patient care, avoidable suffering and a public inquiry into systemic failure.

Each of these is in some way a failure of leadership and organisational design. It can of course be argued that a failure of leadership is a consequence of a failure of organisational design. There's certainly a failure of trust.

Asset possibility

But it is not all bad. Treating people as assets is happening in some organisations. No doubt many startups and scaleups get this. But such intelligent behaviour is considered exceptional in organisations with any track record.

• Toyota – Empowers frontline workers to identify problems and improve processes. Impact: Higher quality, continuous learning and operational excellence.

  
  

• W. L. Gore and Associates – Uses minimal hierarchy and encourages self-organisation. Impact: Greater innovation, adaptiveness and employee commitment.

  
  

• Southwest Airlines – Prioritises employees and empowers frontline staff. Impact: High customer satisfaction, workforce loyalty and long-term profitability.

  
  

• Costco – Invests heavily in employee pay, benefits and retention. Impact: Lower turnover, higher productivity and strong financial performance.

  
  

• NVIDIA – Gives highly skilled employees autonomy and trusts their judgement. Impact: Sustained innovation and market leadership.

  
  

• Patagonia – Builds trust, flexibility and purpose into the employee experience. Impact: High engagement, retention and brand advocacy.

  
  

• Semco – Replaces command-and-control management with self-management and transparency. Impact: Increased ownership, resilience and organisational adaptiveness.

  
  

• Google – Encourages experimentation, collaboration and employee-led initiatives. Impact: Breakthrough innovation and rapid organisational learning.

  
  

• John Lewis Partnership – Aligns employee and organisational interests through ownership. Impact: Strong commitment, accountability and long-term thinking.

  
  

• The Ritz-Carlton Hotel Company – Trusts frontline employees to make decisions on behalf of customers. Impact: Exceptional service quality and rapid problem resolution.

  
  

• Haier – Pushes authority and accountability to autonomous business units. Impact: Faster adaptation, entrepreneurship and responsiveness to change.

These companies have boosted their market brand with their employer brand. Brand value, and its derivative, market capitalisation, is a clear measure of value. 

Think cognition

Some of you will be thinking, “Get with the programme, Daddio.” AI is here so let’s run down the people and focus on AI assimilation. That of course presumes a ‘worker OR tech’ stance. Companies such as Klarna, IBM and Duolingo are cautionary tales in this respect.

A more enlightened perspective is to think in terms of ‘worker AND tech’. In my work, I prefer to use the term cognition to address the combination of natural intelligence (worker) and artificial intelligence.

AI needs to be seen as a tool to augment the workers, to turn them into high performing cognitive athletes. In fact, this could have been the reality if the business world had listened to Peter Drucker. AI when used sensibly is simply adding cognitive steroids to the mix.

Given that cognition is the asset of interest, I would recommend that HR and IT sit down and rethink their trajectories.

Much of my work is around helping organisations turn their battery farms into cognitive gymnasiums, where high performance athletes come to raise each other’s game whilst benefiting all stakeholders. In this model the manager becomes the cognitive coach.

Why cognition?

There needs to be a rationale for harnessing the power of tech and people. Not everyone sees it because they are so busy scrutinising their strategic plan that they fail to look out of the window. Much like pretending it is business as usual when your headquarters sits atop an active fault line during an earthquake.

Looking out of the window is a crude but effective form of sensing. Those that have a better sense of their surroundings (exteroception – in neuroscience) will see that there are growing forces at play. Some of these forces are manmade and some are natural. They are compounding and conflating to make the world unknowable. Disruption is thus creating an unknowable world.

An unknowable world presents novel situations with increasing frequency. Process-centric organisations, ie most organisations, ossified by process, are unable to respond to new situations. Novel situations thus require an innovative response. Thus innovation is the mechanism by which organisations navigate their environments and thus remain viable.

Fuel for thought

The fuel for innovation is cognition. QED Cognition is critical to your organisation’s viability. Again in an uncertain world, innovation becomes core business. Business as usual should be considered as a collection of background habits that require approximately zero management attention.

One could argue that if cognition is the ultimate fuel for modern business, organisations should simply stock up on AI and eliminate human staff to cut high overhead costs.

However, this logic overlooks a critical advantage: most companies have already paid the upfront cost for human capital. With targeted investment, the dormant cognitive potential of an existing workforce can be unlocked immediately.

In contrast, enterprise AI remains largely unproven beyond basic task automation. It introduces significant, unresolved risks regarding data accuracy, operational transparency, cybersecurity and systemic bias. Whilst many leaders believe they are stockpiling advanced technological armaments, they are actually accumulating an expensive inventory of future operational headaches.

Nurturing the asset      

Transitioning to a people-first organisation is difficult when the organisational design promotes the opposite. A few years ago, I helped a pharmaceutical manufacturer create a governance structure that enabled the workers to share their ideas on:

• How to improve the organisation

• How to decide which ideas to run with

• How to measure the associated value realisation.

  
  

The talent was highly engaged, not least because their ideas could accelerate their visibility with senior management, and thus their professional progression.

It’s worth noting that we are entering a post-careers world. In more predictable times, after leaving school, you could enter an organisation and steadily move up the ranks before collecting your gold watch. As industry grew, it was possible to do the same but via an assortment of companies. Today, not everyone wants to ascend the greasy pole and so have created their own definition of what they want from work.

I suggest HR thinks of the organisation as a railway station. The majority of the people you see on a daily basis are only using the station to get to where they want. If another station can do that better, they will use it. HR’s role is to create an environment where the talent sees no reason to move.

To clunkily switch analogies, one might think of the organisation as a nightclub where the leader is the deejay. Intelligent deejays cultivate an environment where people can express themselves freely and are in no rush to leave. And intelligent nightclubs can be detected by the perma-queue of people hoping to be part of the experience.

Conclusion

While a clear path forward exists, a frustrating paradox remains: very few leaders or organisations can accurately diagnose the underlying problem.

On an individual level, employees and managers remain blind to the root cause because they lack the conceptual framework needed to perceive it. They are acutely aware of the day-to-day symptoms, the friction, inefficiencies and stress, but lack the structural lens required to design a systemic cure.

This strongly points to an organisational design issue, which oddly sits within HR and therefore is unlikely to be on the c-suite’s radar. Consequently the leaders continue to fan the ‘people as resources flywheel’. And of course, leaders are people too. So they are in effect self-harming by not addressing the structural issues.

It is intended that this essay serves to change the conversation around talent and AI. Please share if this essay resonates with you.