Homo Economicus

ephraim “I think to start answering the questions you’ve posed we need to stop using the term ‘human capital management.’

The main point of ‘social business’ is that people and their connections move to the forefront (of software, organizational structures, planning, etc). As a term, ‘human capital management’ really takes the ‘human’ out of people.

‘HCM’ represents a detached, mechanistic way of talking about people and leadership. Let’s do away with it.”

ephraim commenting on “Why Social Business?” | October 13, 2011

Thank you, Ephraim for your comment, to which I am in the main sympathetic. A few things, though.

One is that production in a capitalist system can be alienating, dispassionate and, even, unkind. Using terms like “human capital management” is, to a certain extent, just calling it like it is. Terms like human resources and headcount have become useful as well as popular because they reflect the way things are done. Am afraid that a detached, mechanistic approach to labor is, and has been, at the “heart” of much economic activity and theory.

I hope this situation changes. The possibility that social business may help spur that change is exciting and is the reason I asked, “Will social business spur new organizational forms and new approaches to human capital management?” Perhaps, when the underlying behaviors change, the terminology will change. But we are not there yet.

That said, there are already signs that social business is having the humanizing effect you describe. See David Garvin’s HBS case study of Zensar1, an Indian software services company, whose CEO speaks openly about love, leadership and business. At Zensar, social platforms are critical to building community and innovation.

Here’s some background on where I am coming from. In the mid-90s, I co-edited a book called Human Well-Being and Economic Goals.2 In that book, we questioned how economic theory relied on homo economicus, a strictly rational entity, as a proxy for human agency in economic situations.
https://dev03.mitsmr.io/wp-admin/post.php?post=11859&action=edit&message=1#
That book was an early effort to capture (then) new thinking about imbuing representations of the economic individual with more human traits. The idea that social business may encourage theorists and practitioners to view economic agents as more than “homo economicus” is behind my comment, “Perhaps, making better use of the social animal will prove to be the most enlightened next step in the evolution of modern capitalism.“

Finally, we need to be balanced in our approach to social business in order to distinguish hype from reality. With this new phenomenon, exaggerating the promise of social business is a much lesser fault than exaggerating what is actually happening today. Our goal is to be true to what is happening on the ground while remaining open about where this phenomenon will take us.

So, thanks again for your comment Ephraim. Please stay involved as our social business hub moves forward.