Analysis: Human capital
Analysis and Reflection #3
Part one
Human capital can generally be defined as the set of skills which someone acquires on the job, through training and experience, and which increase that person’s value in the market place. Any activity that increases the productivity of labor may be considered an investment in human capital (McConnell, 2009). Company can spend not only on formal education for employees, but also can spend on informal training. In addition, providing them with health or other benefits could also improve employees’ productivity. According to Dereck Jones (2008), investment in human capital benefits both the employee and the employer. For instance, when a company invests in training, Jones posits that the company benefits through increased efficiency in the production process and thus experiences increased and quality production while the employee benefits from having an easier time at work.
At the moment, there is a lot of discussion and theories raised in regard to human capital investment. As a human resource manager I would apply the insights from the discussion about human resource investment in the following ways. First of all, I would set up a structure whereby all new workers are given some company specific training. According to McConnell et al (2009) new workers take a considerably long amount of time adjusting to a company’s structure and processes. During this phase when new workers are being integrated into the system, they are not very much productive. To avoid prolonged periods of new workers adjusting to the company processes, I would invest in a company specific training program to ensure that all workers are integrated and they understand their duties and how they are supposed to achieve them.
McConnell et al (2009) posits that a company that has invested in firm specific training loses the firm specific training when it loses an employee. However, firm specific training increases employee loyalty and helps an employee to
Part one
Human capital can generally be defined as the set of skills which someone acquires on the job, through training and experience, and which increase that person’s value in the market place. Any activity that increases the productivity of labor may be considered an investment in human capital (McConnell, 2009). Company can spend not only on formal education for employees, but also can spend on informal training. In addition, providing them with health or other benefits could also improve employees’ productivity. According to Dereck Jones (2008), investment in human capital benefits both the employee and the employer. For instance, when a company invests in training, Jones posits that the company benefits through increased efficiency in the production process and thus experiences increased and quality production while the employee benefits from having an easier time at work.
At the moment, there is a lot of discussion and theories raised in regard to human capital investment. As a human resource manager I would apply the insights from the discussion about human resource investment in the following ways. First of all, I would set up a structure whereby all new workers are given some company specific training. According to McConnell et al (2009) new workers take a considerably long amount of time adjusting to a company’s structure and processes. During this phase when new workers are being integrated into the system, they are not very much productive. To avoid prolonged periods of new workers adjusting to the company processes, I would invest in a company specific training program to ensure that all workers are integrated and they understand their duties and how they are supposed to achieve them.
McConnell et al (2009) posits that a company that has invested in firm specific training loses the firm specific training when it loses an employee. However, firm specific training increases employee loyalty and helps an employee to
References: National Academy of Sciences. (2008). Future Skills Demand. Washington: The National Academies Press. Hilton, M. (2008). Skills for Work in the 21st Century:. Retrieved february 17, 2013, from Academy of Management Perspectives. Jones, D. (2008). The Effects of General and Firm-Specific Training on Wages and Performance. Retrieved February 17, 2013, from http://academics.hamilton.edu/economics/Home/workpap/09_02.pdf Kalmi, P. (2012, January). The effects of general and firm-specific training on wages and performance: evidence from banking. Retrieved February 20, 2013, from http://ideas.repec.org/a/oup/oxecpp/v64y2012i1p151-175.html Mingat, A. (2003). Achieving Universal Primary Education by 2015 - A Chance for Every Child. Retrieved February 18, 2013, from Education: Human Development Network: http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/EXTEDUCATION/0,,contentMDK:20225533~menuPK:540090~pagePK:148956~piPK:216618~theSitePK:282386~isCURL:Y,00.html Schone, P. (2004, December). Firm-financed training: Firm-specific or general skills? Retrieved February 19, 2013, from Springer link: http://link.springer.com/article/10.1007%2Fs00181-004-0219-3?LI=true