'Short-termism' has always been a big concern in organisational effectiveness. According to the lexicon financial dictionary 'short-termism' refers to an excessive focus on short-term results at the expense of long-term interests. It follows the argument that a preference for short-term performance leads to unintended consequences for the long-term value- adding capability of an organisation (Hayes and Abernathy, 1980). In corporate, this has led to what is referred to as the agency problem, where it is argued that some executives may take decisions that maximise short-term profit at the expense of maximising shareholder value in the long run. We argue that there is a lot of 'short-termism' in how we have approached human capital development in South Africa and the rest of the African continent.
When our focus is on the workplace skills plan, the annual training report and the broad-based black economic empowerment codes, we are in our view, practicsing short termism. We have seen how organisations maximise their skills development points on all these without any consideration on business impact or organisational sustainability. We have seen how organisations focus solely on doing accredited training programs so that they can maximise their mandatory and discretionary grant claims from their Sector Education & Training Authorities (SETAs). This, in our view, is a classic case of short termism in human capital development. Accredited programs are important because they lead to portability but you cannot design learning for unit standards; you have to design for business impact. Those are not necessarily mutually exclusive, they just need a skilled human capital development practitioner who understands that the goal of developing human capital is, first and foremost to improve business performance. We have to design human performance improvement programs that are long term, planned and can be sustained.
Such efforts usually begin with asking the right questions before the start of any learning or organisational development intervention. The process initially starts with an executive sensing that something is wrong but “they can’t really put a finger on it”. It is the role of the professional to take this “hunch” and design a diagnostic intervention, which leads to a thorough organisational diagnosis, a correct plan of action and cosequently business impact. The time for short termism in human capital development is long gone.