This document discusses how an organization's maturity level in managing human capital can impact its ability to create value and control risks. It introduces Organization Maturity Ratings (OMR) as a framework for assessing how well an organization maximizes value through its people strategies and management of all employees. OMR evaluates organizations across ten pillars such as value motive, learning culture, trust, and performance management to determine a maturity rating. Higher ratings indicate organizations that treat human capital as integral to operations and strategy with outcomes including sustainable value creation, lower risks, innovation and inclusive workplaces.

1. Human Capital: Value Creation and Risk
An introduction to Organization Maturity Ratings
BBB+ A- A A+ AA- AA AA+ AAA
Stuart Woollard
CEO OMR Group
& Council member,
Maturity Institute

2. How much does human
capital matter?

3. Understanding how human capital drives value & risk:

4. Value motive – short, long term;
narrow or broad based?
“
The paradox is that by not pursuing
profitability to the exclusion of all
else, the Great Engine companies
in their Golden Age would achieve
enormous increases in
value...whereas, by single-mindedly
pursuing profit...these same
companies and their successors
actually created less genuine,
lasting wealth; indeed, they would
often destroy it.
(The Puritan Gift, Kenneth & William Hopper)
”

5. Profit is critical for a
healthy organisation but
[societal] value is much
broader, cleaner and
sustainable

6. The Measurement Challenge: how people link to Value

7. Maturity ratings & Value
• OMR assesses the extent to which an organization is
designed around the goal of maximizing its value, while
controlling risk, with respect to all its human capital.
• Value relates to the organization itself (i.e. productivity,
quality, revenue, cost) and value generated by the
organization in a societal context (e.g. economic, well-being,
environmental).
• Human capital relates to an organization’s people and all
people connected with the development, production and
supply of an organization’s goods and services.

8. Measuring or rating maturity:
“Art is about learning to
see and to observe. And
the sciences are about
seeing and observing.” –
Ed Catmull, Pixar
8

9. Value
Motive
Whole
system
Learning
Organization
Improvement
philosophy
Human People risk
capital
ethos
Trust
Communication
Performance
Engagement
Cooperation
system
Business/pe
ople strategy
The Ten ‘Pillars’

10. OMR
Stage 2
Good
Professional
Practice
Stage 3
Effective
Management
Stage 4
Human Capital
becomes integral
to business
operations
Stage 5
Transition:
operational
to strategic
focus
Maturity spectrum:
OMR ‘AAA’ Scale
Stage 1
Personnel
Administration
Board & Executives
resistant/unaware of people &
human capital value up to this
point
Stage 6
Organisation
becomes a
whole system
Stage 0
No Conscious
People
Management
©Paul Kearns/OMR 2013
LONG TERM - STABILITY
SHORT TERM –
UNSTABLE
A+ to
AA-AAA
BBB to
A
BBB-BB+
BB
C
B

11. Maturity predicts value creation & destruction

12. Value vs supply
chain orientation
Embedded
societal value &
responsibility
Truly inclusive
workplaces
Best/sustainable
resource use
High trust,
cooperation &
informed
decision making
Learning,
knowledge &
innovation
Maturity drives
higher value,
lower risk &
‘good’ outcomes
“social, economic, environmental, and ethical
factors directly affect business strategy—for
example, how companies attract and retain
employees, how they manage the risks and create
opportunities from climate change, a company’s
culture, corporate-governance standards,
stakeholder-engagement strategies, philanthropy,
reputation, and brand management.” – David
Blood 2007

13. Maturity in practice: value outcomes
Early indicators:
 Exec expectations of human capital & value now aligned
 Organization now adopting a new language around HCM
 10 Pillars embedded into assessment of planned HC activities
 Maturity is new framework for decision making
 Senior execs now lead on HC initiatives
 HR team now business focused rather than "best practice”

14. Thank you
www.omratings.com
Stuart.woollard@omratings.com
+44 [0] 7940585661