HCM may seem relatively new, but the concept can be traced back to Sir William Petty in 1696, who proposed factoring in the cost of human life to anything from labour to war. Similar themes of investing in people can be found through history in the writings of Adam Smith, John Stuart Mill, Jean Baptiste Say and others who wrote on capital and labour. The term “human capital” first appeared in 1961 from Schultz: “Consider all human abilities to be either innate or acquired. Attributes... which are valuable and can be augmented by appropriate investment will be human capital.”
HCM of today is built on this foundation of investing in people and talent management above simple administration from a standard HR role.