Although companies say they recognize the importance of people in business, they tend to focus on cost-cutting and short-term productivity gains.
The problem with this approach is that the payroll savings often translate into fewer and lower-quality resources, which, in turn, lead to diminished operational performance, and hence, weaker sales and profits.
To stop this vicious circle, IESE professors Philip Moscoso, Alejandro Lago and Carlos Rodríguez-Lluesma offer an alternative view to the policies and operational practices commonly used by companies, focusing on the human factor.
To better understand the human dimension and its impact on operations management, one must first grasp three truths about people: their productivity depends on their motivation; they have the ability and desire to learn and develop over time; and they have certain biases that may lead them to make a number of systematic mistakes in decision-making.
Read full article on the IESE Insight website.