Human Capital Development And Corporate Performances (A Case Study Of Zenith Bank Akwa Ibom State)
Human Capital Development And Corporate Performances (A Case Study Of Zenith Bank Akwa Ibom State)
Abstract
The purpose of this research work is to examine human capital development and corporate performance using a case study of Zenith bank, Akwa Ibom state. The study adopted a sample size of 283 using Taro Yamene formula at 5% error to tolerance and 95 % level of confidence. Instrument used for data collection was primarily questionnaire. The descriptive research design was adopted for the study. The findings indicate that there was significant relationship between human capital development and corporate performance. Training positively affects corporate performance. Incentives and compensations positively influence corporate performance. The study concluded that theoretical and technological advance in human capital development has allowed manufacturing organizations to move beyond managing personnel by head count and billet, the managing their workforces. The study recommends that Firms should conduct a workforce assessment to determine the current human capital capacity based on the verified job requirements.
Table of Content
Chapter One
1.0 Introduction
- 1.1 Background of the Study
- 1.2 Statement of Problem
- 1.3 Research Objectives
- 1.4 Research Questions
- 1.5 Research Hypothesis
- 1.6 Significance of the Study
- 1.7 Definition of Terms
- 1.8 Organization of the Study
Chapter Two
2.0 Literature Review
- 2.1 Conceptual Framework
- 2.2 Human Capital Development (HCM) Features And Functions
- 2.3 Human Capital and Complementary Capitals
- 2.3.1 Intellectual Capital
- 2.3.2 Social Capital
- 2.3.3 Organizational (Structural) Capital
- 2.4 Human Capital, Human Resources: Rhetoric And Reality
- 2.5 Critical Views on Human Capital
- 2.6 Concept of Organisational Performance
- 2.6.1 Factors Affecting Performance
- 2.7 The Relationship Between Human Capital and Firm Performance
- 2.8 Theoretical Framework
- 2.8.1 The Theory on Performance Management
- 2.8.2 Human Capital and the Resource-Based View Theory
Chapter Three
3.0 Research Methodology
- 3.1 Design of the Study
- 3.2 Area of the Study
- 3.3 Sample and Sampling Technique
- 3.4 Instrument for Data Collection
- 3.5 Validation and Reliability of the Instrument
- 3.6 Method of Data Collection
- 3.7 Method of Data Analysis
Chapter Four
4.0 Results and Discussion
- 4.1 Results
- 4.2 Discussion
Chapter Five
5.0 Summary, Conclusion and Recommendations
- 5.1 Summary
- 5.2 Conclusion
- 5.3 Recommendations
- References
- Appendix
Chapter One
1.0 Introduction
1.1 Background of the Study
Today’s business environment is in the state of flux, where competition is the name of the game. Organizations that fail to change may be forced to change from existence to non-existence, hence survival is the panacea. To survive, companies must explore all available avenues that can bring about competitive advantage. To develop a competitive advantage, it is important that firms truly leverage on the workforce as a competitive weapon. A strategy for improving workforce productivity to drive higher value for the firms has become an important focus. Firms seek to optimize their workforce through comprehensive human capital development programmes not only to achieve business goals but most important is for the long term survival and sustainability of the organization. To accomplish this, firms will need to invest resources to ensure that employees have the knowledge, skills, and competencies they need to work effectively in a rapidly changing and complex environment (Marimuthu, Arokiasamy, and Ismail, 2009).
In response to the changes, most firms have embraced the notion of human capital has a good competitive advantage that will enhance higher performance. Human capital development becomes a part of an overall effort to achieve cost-effective and firm performance. Hence, firms need to understand human capital that would enhance employee satisfaction and improve performance. Although there is a broad assumption that human capital has positive effects on firms’ performance, the notion of performance for human capital remains largely untested.
Human capital development can contain different aspect, such as personal cost, performance of employee turnover or demography .Human capital development is an attempt to place a financial figure on the knowledge and skill of an organisation employees or human capital (Bnet 2008) but also includes the planning, controlling and analysing of all personnel management related procedures as far as they are quantifiable. The growing number of articles shows the increasing relevance of human capital development theory take the view that employees can be regarded as assets (Ordiorne 1984) They even believe that value can be put on them and that employees can be managed much as a portfolio of stocks in managing and maintain or enhance their value to the firm (ordiorne 1984).
Human capital generally refers to a repertoire of knowledge, competency, attitude and behavior embedded in an individual (Youndt et al., 2004; Rastogi, 2002). It has gained increasing recognition among organization and management scholars because of its promise to deliver competitive advantage (Gratton, 2000; Pfeffer, 1994), create value (Rastogi, 2002; Mayo, 2001) and secure long-term economic growth (Tomer, 2003; Chuang, 1999). The growing emphasis on human capital in organizations reflects a view that market values depend less on tangible resources and more on intangible resources, particularly human resources (HR) (Edström and Lorange, 1984).
The development of the resource-based view of the firm (Barney, 1991; Penrose, 1959), together with influence work in strategy on organizational core competencies (Hamel and Prahalad, 1994), has placed the role of human capital centre stage within organizations. People and people processes, it is claimed, create competitive advantage chiefly through the characteristics of being (potentially) valuable, rare, hard-to-imitate and non-substitutable (Wright et al., 1994). This means that a link between HR practices and the firm-specific nature of particular organizations can foster uniqueness and create high barriers to imitation (Becker et al., 2001; Wright et al., 2001). In order to build a competitive advantage, organizations need to define what human capital really means and how to deliver effective human capital development.
As some scholars state:“…HR leaders [need] to know that the work they’re doing is among the most important work that anybody can do. Human capital is, and should be, the centre of any business.” (Rosner, 1999: 41) “[Human capital is] generally understood to consist of the individual’s capabilities, knowledge, skills and experience of the company’s employees and managers, as they are relevant to the task at hand, as well as the capacity to add to this reservoir of knowledge, skills, and experience through individual learning.” (Dess and Picken, 1999: 8) Such a philosophy requires, it is argued, a strategic approach to managing people, implementing solutions for evaluating workforce capability, identifying skill gaps areas and improving employees’ productivity, performance and well-being (Mayo, 2001). Strategic issues such as increasing firm’s performance (Maruping, 2002), designing competencies (Nordhaug, 1998), human capital measurement (Critten, 1994), returns on investment of human capital (Fitz-enz, 2000), benchmarking (Huang et al., 2002) and resource allocation (Lepak and Snell, 1999). Hence, this study attempts to look into the connection between human capital development and firm’s performance.
1.2 Statement of Problem
The productivity of workers is falling resulting to poor and low performance of the organization. This is because most firms fail to send their employees on training due to lack of funds that is involved in embarking on employees training. Also most firms believes that workers are dubious in nature, after returning from training desert their firms to join other firms. For instance most Nigerian organization do not give their employee effective and efficient training, considering the cost implication of sending employees on quality training which result into low productivity. Nevertheless, the issues of human capital development are not taken seriously by many organizations, this is because of the failure to acknowledge the fact that business environment has become very dynamic and as such only those organizations with the right informational need in the business times can succeed with the right technological manpower to succeed in modern times. Failure to take training and development especially in modern organization will lead to stifling growth, lack of productivity and inability to compete favourably in the industry. Pertinent to the above the study seeks to investigate the effect of human capital development on organizational performance.
1.3 Research Objectives
The purpose of this study is to examine human capital development and corporate performance using a case study of Zenith bank, Akwa Ibom state.
Specifically, the objectives include:
- To establish the relationship between Human capital development and corporate performance in Zenith bank, Akwa Ibom state
- To examine the extent to which training affects corporate performance in Zenith bank, Akwa Ibom state
- To ascertain the extent to which talent management impacts on corporate performance in Zenith bank, Akwa Ibom state
- To evaluate the extent to which incentive and compensation influence organizational productivity in Zenith bank, Akwa Ibom state
1.4 Research Questions
This project is designed to tackle the following reach questions;
- What is the relationship between Human capital development and corporate performance in Zenith bank, Akwa Ibom state?
- What is the extent to which training affects corporate performance in Zenith bank, Akwa Ibom state?
- To what extent does talent management impact on corporate performance in Zenith bank, Akwa Ibom state?
- To what does extent does incentive and compensation influence organizational productivity in Zenith bank, Akwa Ibom state?
1.5 Research Hypothesis
The following null hypotheses were formulated to guide the study the hypothesis is to be tested at 0.5 alpha levels.
- HO: There is no significant relationship between human capital development and organizational performance in Zenith bank, Akwa Ibom state
- HO: Training does not positively affects organizational performance in Zenith bank, Akwa Ibom state
- HO: Talent management does not significantly positively impacts on organizational performance in Zenith bank, Akwa Ibom state
- HO: Incentive and compensation don’t positively influence organizational productivity in Zenith bank, Akwa Ibom state
1.6 Significance of the Study
It will show how organizations will maintain, develop workforce in other to enhance organizational productivity.
The findings of this study would highlight the need for managers and trainers to design the content of their training and development programmes to reflect the needs of the employees and the organization.
It is significant in the sense that its findings will serve as a base and framework for future researchers to carry out further studies.
1.7 Definition of Terms
Human Capital Development:
This is the abilities and know-how of men and women that have been acquired at some cost and that can command a price in the labour market because they are useful in the productive process.
Human Resource Management:
This is the process of accomplishing organizational objectives by acquiring, retaining, terminating, developing and properly using the human resource in an organization.
Talent Management:
This encompasses all the applications necessary for handling personnel-related tasks. For corporate manager and individual employees from the point of hire to the point of retire.
Training:
This focuses on teaching organizational members how to perform their current jobs and helping them acquire the knowledge and skills they need to be effective performers.
Organizational Performance:
This is the commonly referred to as financial performance where considerations of budgets and assets are crucial in determining the overall bottom-line of an organization.
1.8 Organization of the Study
This study is divided into five chapters. The first chapter is the introduction which contains the background, research problems and objectives. The second chapter is the literature review and the third chapter is the research methodology. In the fourth chapter, the researcher analyses the data and discusses the results. The fifth chapter is the last chapter which presents the summary, conclusion and recommendations.
Chapter Five
5.0 Summary, Conclusion and Recommendations
5.1 Summary
The result based on the descriptive statistics reveals the following:
- There was a significant relationship between Human capital development and corporate performance. The test of hypothesis one confirmed this (r=.889).
- Training positively affective corporate performance in Zenith bank, Akwa Ibom state (X2c 39.438 > X2t = 15.51).
- Talent management positively significantly impacts on corporate performance in Zenith bank, Akwa Ibom state (X2c 102.988 > X2t 15.51).
- Incentives and compensation positively influence organizational productivity. The test of hypothesis four confirmed this (Zc = 5.129 > Z=1.96).
5.2 Conclusion
On the basic of research findings the following conclusion were made. The study concluded that theoretical and technological advance in human capital development has allowed organizations to move beyond managing personnel by head count and billet, the managing their workforces. Knowledge, skills, abilities and other characteristic. On a world of limited resources managing by human capital provides avenues for greater synergies and optimization.
5.3 Recommendations
Based on the findings from this study, the following recommendations were put forward:
- Firms should verify and validate the job information gathered to ensure that it accurately reflects mission requirements. Based on the information, consider streamlining the organization to generate synergies.
- Firms should conduct a workforce assessment to determine the current human capital capacity based on the verified job requirements.
- Firms should develop, verify and validate the proficiency scale so that the points on the scale are criterion-referenced, i.e. able to accurately reflect the level of proficiency required. The proficiency scale should account for gains in human capital from on-the job experience.
- Firms should explore areas in human resource management where the manpower readiness index can be used as a performance measure.
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