Description
Investing in people and developing management systems which treat people as a valuable asset, similar in importance to that of finance capital or physical assets, can substantially assist companies to improve and sustain their competitive advantage. Sophisticated human asset strategies have a pressing importance in the 1990s when demographic shifts and skill shortages are expected to undermine the competitive advantage of many Western companies. Keith Bradley and Simon Taylor demonstrate the importance of such strategies by focusing on the John Lewis Partnership, a major retailing company which has since 1929 been owned by its employees and run according to a set of democratic business principles. Conventional models of commercial success derived from neoclassical economics would predict that the firm would be inefficient and tend to under-invest as a result of the lack of capital market discipline an the influence of employees on decision-making. Using a wide range of conventional performance criteria the authors demonstrate that the John Lewis Partnership is highly successful and strongly suggest that the conventional approach to the determinants of business performance is flawed.
