Are People Your Greatest Asset?

Scott contributed a comment to a recent article on how to motivate front line workers:

I never liked the expression that “people are your greatest asset”. People should never be looked upon as an asset. An asset is defined as property owned and controlled by the firm. People cannot be controlled, only influenced, and are certainly not owned. Therefore, people should be looked upon as members. Members are stakeholders in an organization. This recognition is one step towards respect for people, versus looking at them as objects.

The notion that Toyota puts people on the asset column of the balance sheet is a piece of the Toyota mythos that has entered the consciousness of lean thinkers. I don’t know the exact source of this idea. Likely it was an interpretation of a comment or a fragment of a speech made by one of Toyota’s Japanese leaders in reference to how they value their people. It would be interesting to see the original quote. The term “zaisan” is often translated as asset, even though it means also “wealth” or “riches” that belong to a person, family or company. Scott may argue that people are not riches that “belong” to a company, but we could say people belong as a member belongs to a team.

In English we use the term “asset” rather loosely to mean strengths, skills or capabilities that confer some advantage and not always in the strict financial asset definition that Scott describes above. However, he raises a good point that speaking of people in terms of assets can risk dehumanizing people. This raises a few questions:

1) Does your organization view or describe people as their greatest asset or contributing factor to generating value?
2) If your organization does not view people as their greatest asset, would there be more or less harm in your company if the leadership began believing in and referring to people as their greatest asset?
3) Is it possible to view and refer to people as assets and still respect them as individuals without dehumanizing them or thinking of them as controllable resources?

And a bonus question, if the answer to 1 was “no” then what exactly does your organization believe is your greatest asset?


  1. Joseph

    August 26, 2010 - 2:34 pm

    Most companies pay lip service to saying that people are their greatest asset.
    The owners think that it looks good in the “mission, values & guiding principles.” They think that it wins, Brownie Points, with the public and workers and looks as though they embrace diversity.
    I believe that they actually think that the Management are their best assets. All men are born equal but some are more equal than others. In separating the people into two distinct groups, Managers and Workers, the battle lines are drawn.
    The Japaness are no different they just make the dividing line harder to see. They believe that people should respect authority. It is bread into them but does not work the same in the West.
    Now to the RESPECT issue. People talk about we respect them. This is all wrong. Instead of saying I respest them, people should conduct themselves in a manor that commands respect from people. Note I did not say demand respect but command respect.
    It is wrong to treat RESPECT as a thing that you give out, it should be a thing that you draw to you or earn . If you conduct yourself in a manor that commands respect then you should never loose it.
    RESPECT should not be given in advance of being earned. If a person does not earn your respect then do not give them any. That does not mean that there is hostility you just work with them but you do not pay lip service to respecting them. It becomes worthless if it is not earned and precious if it has been earned correctly.
    I can respect an Operator the same as the Operations Manager if they deserve it.

  2. Owen Berkeley-Hill

    August 27, 2010 - 1:31 am

    Hi Jon,
    I suspect the term was coined during the sushi runs to Japan in the 80s when anyone who was anyone, or would have liked to be someone justified their benchmarking trip to discover the source of the Japanese advantage. If my memory serves me, I doubt much of any use was learnt during these expensive 5 Star visits, but they did create some very damaging myths. For example, we were told that the Japanese “got things right first time”, and this then became a big inhibition as no one wanted to make any career-damaging mistakes. I also remember the expression “people are our greatest asset” used just before a redundancy programme was announced. As Joseph rightly says, this looked good on the MVGP (mission, values, etc.) which I believe was developed (I suspect rather reluctantly) as a result of the association with Dr Deming. We then half-heartedly tried our hand at Quality Circles, Employee Involvement and Process Improvement, but these were seen as radically dangerous stuff which might bring the organisation to its knees. You must remember in those days, hugging trees or getting in touch with your feminine side (even for women) was seen as a capital offence with no last-chance reprieve.
    The phrase is meaningless whether you see the term “asset”, when used about the workforce, as a positive or a negative. If we treated people as an asset, how would we measure our efficient use of their capabilities? No, I’m not talking about that silly and destructive measure, Labour Efficiency (Note: it is “Labour” not “Work”, so it applies to “them”, not “us”). I am thinking of the potential bran power which could be harnessed, but is not. And this is where the natural sciences have a massive advantage over that gaggle of stuff labelled as “management science”. The miracle/curse of the mobile phone would not be possible without precise measures such as the nanometre, picoliter, Volt, Ohm or Watt. For all its bluster, the management sciences have not yet developed a measure of the brain power available in the workforce. Without such a measure, managers get away with appalling levels of incompetence. If such a measure had been discovered (let’s call is the BraWatt) the majority of today’s supervisors, Managers and CEO’s would take greater heed of Konosuke Matsushita when he said:
    “For us, the core of management is precisely this art of mobilising and pulling together the intellectual resources of all employees in the service of the firm.”
    That was said over 30 years ago and has had little impact since on current leadership thinking. But if we could measure the BraWatt available and also that which was used productively, not many leaders would keep their jobs. It is said that only 20% of people’s capabilities are used which is a criminal waste when you think of how the business schools convince their MBAs to “sweat their assets”.
    So are people an “asset”? I doubt anyone would mind being thought of as such, so long as they were able to work with pride and climb Maslow’s hierarchy.

  3. Jon Miller

    August 27, 2010 - 8:39 pm

    Hi Owen
    Thanks for your insightful comment.
    It still amazes me that the open secrets of Japanese management have been so thoroughly misunderstood for so long. Mr. Matsushita’s simple message to get every person to think and improve is a case in point.
    What’s the message of most major world religions? Love one another. Sadly, too often lost in translation.
    Neither of these are too difficult for us to understand or do. Both are extremely threatening to those who have power.

  4. Rob

    August 28, 2010 - 1:58 am

    Jon – not directly related to this post but I read this article:
    The written languages of China and Japan have been around for thousands of years, but in the global digital age, Western style Roman letters are far more useful on computer keyboards and mobile phone keypads. So much so that many kids in China and Japan become far more comfortable writing, texting and typing either the romanized versions of Chinese and Japanese words or highly simplified versions that they have to be reminded how to write them properly.
    What affect will this have on communication over and above the normal lean tools: A3s, visual controls, etc?

  5. Owen Berkeley-Hill

    August 28, 2010 - 8:55 am

    Thank Jon for your kind words.
    I found out early in my career that if something could be misunderstood or distorted it would soon be. Because the senior management in the West were adapt at playing games and hiding the truth, I got the impression that they thought the Japanese were doing the same during the benchmarking visits. For example, I remember the story of a plant in Northern Ireland, which when told that the big boss from the US was going to visit them, hid the WIP in a shed the day before thew visit. They’d heard that he was hot on inventory. The visit went well and the boss was impressed, but boy did the plant have a problem because no one had bothered to label containers, and no one knew what was to be scrapped, what was WIP and where it should go next, and what was on engineering hold. Each container contained between 350-400 parts each with a value of around $12.
    Matsushita-san’s, as much as Toyota, has been my inspiration during my journey to understand Lean. Because much of the dialogue on Lean is focused on the application of the Toyota tools and not the underlying philosophy which developed those tools, I have struggled with the simple definition of Lean which suggests it only about eliminating Waste. If that was so then any action which eliminated waste would be Lean. If definitions of Waste were made a bit more elastic, then Lean would suffer the same distortions as BPR, and it soon be seen by the most vulnerable as a way of reducing headcount. To this end I have used Matsushita-san’s observations to define my own definition:
    The art of mobilising and pulling together the intellectual resources of all employees in the service of the firm so that it continually delivers products to its customers of the highest quality, with the minimum use of wasted resources
    Knowing how awkward customers can be according to Kano’s model of quality, and recognizing the importance of kaizen, I have redefined Quality as:
    A measure of how well an organisation delivers the customers’ perception of value.
    I hope these two definitions make managers realize that without their most valuable asset firing on all sixteen cylinders, the organization is not going to make any Lean headway.

  6. Chris Nicholls

    August 31, 2010 - 8:11 am

    In my organisation people are referred to as members and it is through people we achieve our objectives. However it is irrelevant what your call them it is how you treat them that makes a difference. It makes good sense to respect your people’s opinions and ideas encouraging them all to be involved in improving the business.
    Leadership should inspire and encourage people to make improvements through their actions not their words. A simple management principle I use is to recognise or reward the behaviours I want to see, because that encourages those behaviours to be repeated. Management who are not treating their people with respect might be described as a liability rather than an asset.
    An asset is more likely to be considered as a thing not a human being. I think it is important to treat people like human beings by dealing with them as you would like to be dealt with yourself.

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