· 2 min read · Features

Don't ignore trust, anger and panic

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The tired assertion, 'people are our greatest asset', has been disproved by the credit crunch.

I am sure I'm not alone in receiving occasional requests from students, seeking help with projects. I recently had one from a German student studying in the UK. She was studying HR in a second language. This, of course, means she must learn a third language - the peculiar terminology adopted by HR practitioners.

I wonder what she will make of terms such as 'agile organisations', 'listening skills', 'downsizing', 'employee engagement' and 'core competencies'? I thought I had heard them all until I went to a US-style presentation in London recently held by US consultancy O C Tanner. I could just about forgive the presenter's attempt to wake up his audience with cries of 'Hallelujah' and 'Amen'. But I thought he let himself down when it became clear he did not know that what he called 'onboarding' is actually called staff induction in the UK.

The list of American-style buzzwords provided in the information pack betrayed a definite divergence in US and UK management cultures. Here are some of my favourites: clockroaches - employees who spend most of their day clock-watching; bobbleheading - the mass nodding of agreement in meetings; and cube farm - an office space consisting of cubicle workspaces. But far and away the best for the way it creates an instant image in the mind has to be prairie dogging which occurs when workers simultaneously pop their heads above their cubicles to see what's going on. It makes me think of a family of meerkats.

There must be quite a lot of prairie dogging just now as nervous office workers maintain a vigil over their desks in a declining economy. I shouldn't make light of people's livelihoods but the banking crisis exposed the fragility of careers, even in the most admired institutions. You don't need me to tell you that no one and nothing is safe just now. I wonder how many business books have been shredded these past few weeks, as once shining examples of HR practice struggle to repair their tattered reputations.

Remember how bosses would boast 'our employees are our greatest asset'? It made so much sense. People always make a difference. But some make a bigger difference than others, and not always for the best.

I had a problem answering the German student's question. She had been asked to select an organisation and discuss its approach to HR management. She had chosen Royal Bank of Scotland, and after trawling on the web had turned up some of my articles, praising RBS, no doubt, for its human capital management systems.

So were we all wrong? I think the answer is 'no'. The HR team headed by Neil Roden at RBS has done some pioneering work in performance management. The bank's recent decline in fortunes tells us not that HR is ineffective, but that HR's value may be less than is sometimes claimed. It couldn't halt a slide in investor confidence as the bank was engaged in consolidating an expensive purchase of Dutch bank ABN Amro.

As field marshall Montgomery's attempt to capture the Arnhem bridge in the second world war was described as 'a bridge too far' so, after a string of acquisitions, ABN Amro was a bank too far for RBS.

If anything disproves the assertion that 'employees are our greatest asset', this does. No matter how talented, productive or engaged a workforce may be, if a market downturn swiftly follows such an aggressively bold purchase, there is going to be trouble. When the downturn has the power of a tsunami, as this did, a bank needs financial strength in depth. But RBS was financially stretched at just the wrong time.

The credit crunch demonstrated that a business is not people alone. Nor is it a building or the services it provides. There are abstract, human, emotional, constituents - trust, love, anger, panic. We can never truly value these things. They will remain the hidden, perilous, measures of performance.

Richard Donkin is author of 'Blood, Sweat and Tears' and 'The Evolution of Work'

richard.donkin@haymarket.com