From G-D to S-D Logic in Human Capital Resource Management

In the human capital resource (HCR) management industry customers (i.e., employers, workers, and learners) are looking for alternatives to current solutions provided by higher education and training providers and recruiting and placement firms. Although there has been a constant stream of assurances from solution providers that they are customer-centered they haven’t changed the employer-employee relationship from a two-sided marketplace of employers and workers to same-side interactions that improve overall well-being for workers.

Currently, solution providers rely on old goods-dominant logic concepts which prevents them from realizing that their own customer-centered marketing speak is a form of self-deception. That is the real problem and their marketing deceives employers, workers, and learners as well as stakeholders. A new perspective and accompanying framework is necessary to execute on the value propositions attached to those marketing words in the human capital development and placement space.

Unsurprisingly, current solution providers think that they are relevant to their customers. Well, that would be right if market participants were aware of an alternative framework to enable the interactions that improved their pursuit of career and overall well-being. Then customers could compare relevancy.

I have noticed that representatives of the HCR management industry seem to think that they — their firm and the specific product or service they offer in exchange — create and deliver a particular kind of value to their customers. This idea — the notion of goods-dominant value production — is currently pervasive in all sides of the market. They don’t realize that value is a purely subjective notion, and value is never created by the service provider.

There is no logical way to argue that an entity is able to embed value into a product/service, and then think that this value is somehow consumed by the consumer without it being acted upon. Because there is no such thing as measurable value incorporated in a product/service customers seek experiences, not products.

So, how solution providers think about their position and role must shift towards an expanded view of business output which allows for the co-production of value propositions and the co-creation of value.

Transformation, in the context of HCR management, is about abandoning firm-centered goods-dominant logic and moving towards service-dominant logic concepts.