HR In a Truly Capitalist System

by Matthew Stollak on Monday, April 29, 2013

What would happen if HR truly operated in a truly capitalistic society where everyone is a rational actor?

In such a world, there would be a plethora of choices and perfect information about which choice to make.  Needs would be addressed quickly as businesses operate to fill that vacuum at maximum profitability.  Employees will find those organizations which put together the optimal compensation package with the appropriate work/life balance.  On the other side, companies will try to maximize employment with the best combination of knowledge, skills, and abilities at the lowest wages they can.  Equilibrium will always be reached where supply meets demand.  Consumers, companies and workers will choose the option that is most appropriate to their lifestyle.  Government will not interfere and "distort" the playing field.

What would this mean for HR?

  • Would nepotism disappear as it would be viewed as an inefficient way to find talent, or is it, on certain occasions, a politically expedient choice?
  • Would all salaries become public knowledge, as pay secrecy leads to imperfect information
  • Would negotiation and pay unfairness become a thing of the past as all parties enter the contract with perfect information?
  • Would there be a need for training as firms would only hire those who had the proper qualifications and skills to do the job correctly?
  • Would there be a need for safety committees or OSHA, as taking shortcuts, in the long run, would be inefficient?
  • Would wellness initiatives disappear, as employees make the right choice in diet and exercise?
  • Would performance appraisals be done frequently to address any problems that arise, instead of waiting to be done annually?
Unfortunately, this nirvana is extremely difficult to achieve.  Access to good information is difficult and time consuming.  Optimal choices are not always available or easy to discern.  Even with years of civil and human rights legislation, prejudices and social ills continue to pervade the workplace.  And, in the absence of profit, companies are unlikely to enter arenas such as rural mail delivery or public sector necessities as police or firefighting. 

As a result, we get wage theft.  We get industrial accidents in West, Texas and Bangladesh.

How would you see HR changing in a truly capitalistic society?

One comment

I would be worried about my HR Business Partner job in such a world, I think having lots of irrational people ensures there are plenty of HR jobs!

by HR Mole on April 30, 2013 at 2:49 PM. #

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