EMPLOYEE VALUE AND QUALITY

“Our employees are our most important asset.” This statement makes for great press, particularly if you are one of the “most important assets.” It’s also one of the stock answers that assessment teams are likely to hear. It’s a catch phrase that can also mean, “We’re actually selling you our résumés.” This is one of those bell-ringer phrases that may indicate that the BS Quotient is running a little high. A good employee team is of course one of the most important assets for any business, and it can take a long time to develop, but sustainable businesses also require infrastructure, intellectual property, products, and (of course) revenue along with the résumés. Is there a résumé or CV on file for all employees?

If your primary reason for investing in the business is to acquire its personnel assets, then hearing that the employees are the most important asset is a great message. If, however, you have other strategic reasons for the investment, such as acquiring a product line or customer base, then you need to be aware of what this statement could mean. If you’re looking for a business with a mature operations infrastructure and expect that your investment will be more than résumé deep, then this statement is a risk indicator. The problem will be determining what the strengths of the employee team really are and what that means to the overall value you place on the business. Also, remember that résumés alone don’t indicate the contributions the employees make to the business. Is the value of the business limited to the strength of the employees’ résumés?