Your most valuable asset doesn't show up on your balance sheet. Your most valuable asset is your ability or capacity to perform effectively, in a word: POWER!
Your equipment, computers, business machines, buildings and vehicles are all listed on your balance sheet. There are no item descriptions on your balance sheet for the experience of your employees, the wisdom of your organization leadership or the company culture you've worked so hard to develop.
General Patton once said,
"Remember the French Revolution? That battle was won with brooms, sticks and stones- by a bunch of angry women. Get a determined bunch of men and women and they will win the battles no matter what the odds or what kind of equipment they use."
Training & Development
In fact, the training and experience that develops your culture and makes your workforce so valuable are only directly tied to expenses! You have expenses for training, for research and development and for payroll. The overall return on these investments is reflected in revenue on your profit and loss statement, but the continually accruing asset of a well-trained and motivated workforce are usually only expressed in print through a few paragraphs in your annual report, business plan or brochure.
It's sometimes too easy to cut back on training and development when budgets are strained or economic conditions are difficult. The problem is that while it takes only a decision to cut training expenses, it takes years to build a successful culture.
I'm all for cutting unnecessary or unproductive expenses. If someone isn't producing, get rid of them. If you've truly isolated a wasteful expense, cut it. If you can save, do it. But be very careful when you're cutting training.
The spirit of your company
An organization, just like an individual, has a body, mind and spirit. The body is your people. The mind is your leadership. The spirit is your culture. It takes motivation and discipline over time to develop these resources and keep them healthy and productive. Investments in these resources are essential to generate organizational POWER. Power is the organization's capacity to perform effectively, and that's tied directly to each individual's ability to act effectively and that's a product of motivation and training.
Instead of an expense, training should be listed as a tangible asset account, and one that appreciates with time!
Dynamic Components of Personal Power
10 Jordan Avenue
Brunswick, Maine 04011