Search results

Over the past three years Accenture developed and applied a new measurement tool that assesses the maturity of an organization's human capital development processes, benchmarks the processes' performance against other organizations, and determines the relationship of each process to bottom line business results. It is designed to help executives make significantly more informed choices about their investments in human capital. This article aims to look at this tool.

The tool, known as the human capital development framework, now has been tested in more than 60 organizations. This case describes how one organization used it to help turn around a struggling division.

Results of the initial implementations of the framework suggest that financial performance improves as a company improves its scoring in those critical human capital processes with strong relationships to financial success. As an organization moves from one benchmarking quartile to the next in these processes within the framework scoring, its capital efficiency – or the ratio of total annual sales to the capital invested in the operations of the business by shareholders and creditors – improves from 10 to 15 percent.

The framework outlined in this article provides a tool that enables company leaders to make clear‐eyed assessments of the payoff from human capital investments. It helps organizations diagnose their strengths and weaknesses in key human capital practices, to set investment priorities and track performance, and to establish an empirical link between human capital investments, business practices, and overall business performance.

Those organizations in the study with more mature human capital processes have better financial performance than those organizations with less mature processes. Specifically, those organizations that focus on processes devoted to three key areas – creating a people strategy aligned with the business strategy, providing supportive work environments, and developing employees by giving them ample opportunities to learn and grow – achieve far greater economic success than those that do not.

The purpose of this paper is to seek effective measurement methods that reflect the real value of process capital.

From a system model perspective, the authors refined the existing knowledge of process measurement by distinguishing three kinds of indicator for the value of process capital: input, output, and the capability to manage process capital. The design of this study, therefore, incorporates a longitudinal analysis of the content of process capital and traces its evolution by attaching a monetary value to activities and assets.

The tested results reveal that the input measure is a less effective measure for process capital, while the output measure is a valid one for measuring operational and managerial performance of process capital. The capability to manage process capital can predict all dimensions of process capital in both the short‐ and long‐term periods.

A practical view of process capital enhances the current understanding of process capital by highlighting the sustainability of process value and the validity of measuring output and management capability of the process capital. Second, the study results also explain the productivity paradox because of the complexity of the hidden cost of process input and the distinctive capability of organizations in managing technology and complementary resources. Finally, the system view of process capital, from input through process to output of the process capital, with operationalized measures, provides a useful reference for examining intellectual capital.

The findings offer a more robust definition of process capital as a firm's established capability to exploit the knowledge of business processes and organize resources in designing and managing business activities for sustained value.

The purpose of this paper is to respond to the call by McMullen and Dimov (2013) for a clearer understanding of entrepreneurial journeys by investigating the entrepreneurial capitals and micro-processes of seven young early stage entrepreneurs who all exited their businesses within 3 years of start-up.

The authors analysed empirical data from concurrent in-depth interviews which generated rich longitudinal case studies. Theory-building then led to a proposed “Longitudinal Dynamic Process Framework” of entrepreneurial goals, processes and capitals.

The framework builds on prior studies by integrating entrepreneurial processes and decisions into two feedback loops based on continuous review and learning. It thereby enhances understanding of the dynamics of new business development and unfolds the early stage ventures entrepreneurs' business exits.

The findings are based on a small purposive sample. However, the main implication for research and theory is showing how the entrepreneurial capitals are dynamic and influenced by entrepreneurs' environment, and also separating entrepreneurs' personal issues from their business issues.

The findings challenge some assumptions of policymakers and offer new insights for practitioners and early stage entrepreneurs. These include having more realistic case-studies of the entrepreneurial journey, recognizing the need to be agile and tenacious to cope with challenges, understanding how capitals can interact in complementary ways and that entrepreneurial processes can be used to leverage them at appropriate stages of the start-ups.

The concurrent longitudinal analysis and theory-building complements extant cross-sectional studies by identifying and analysing the detailed processes of actual business start-ups and exits. The proposed framework thereby adds coherence to earlier studies and helps to explain early stage entrepreneurial development, transformation of capitals and business exit.

The purpose of this chapter is to examine the budgeting process in a local church from a social capital perspective. The social capital provides novel insights into the construction of budgets and its social aspects. A qualitative case study was adopted, with an interpretive methodology. Semi-structured interviews were used to interview 14 managers involved in the budgeting process at a local independent church. The interview data were supplemented by documentary evidence. Nahapiet and Ghoshal (1998) framework of social capital was used to analyse the data. The main finding was that budgeting was found to be a social process – that can best be explained by social capital theory. There may be an element of self-selection, as the church agreed to participate in the study and chose to allow a researcher to examine social aspects of its budgeting process. The chapter contributes to both social capital theory and church literature. Social capital provides novel insights into the construction of budgets and its social aspects. In addition, contemporary budgeting practices are studied in a church in a denomination and country not previously studied.

Using a multilevel approach, this theoretical paper aims to build a framework to explore the cognitive and non-cognitive dimensions of human capital, which may in turn explain how they become a source of competitive advantage.

This paper presents several propositions to be empirically tested in further research using multilevel analysis. Starting at the individual level, four configurations of human capital are determined by considering cognitive and non-cognitive human capital. Based on these settings, interactions of human capital at intermediate or departmental level are discussed, taking into account the complexity of the task environment and psychosocial processes. These interactions constitute microfoundations, which explain why human capital may influence different types of organizational capabilities.

The theoretical analysis carried out allows proposing four configurations of human capital, combining individual cognitive and non-cognitive dimensions. These configurations form a human capital portfolio classifying different types of employees. In addition, this paper shows how individual human capital aggregates into departmental level and generates human capital emergence processes by contextualizing through the complex task environments and psychosocial processes. The development of these emergence processes enables proposing the association of certain organizational capabilities with cognitive elements of human capital (absorptive capacity, innovativeness and technical capacities), whereas a second group of organizational capabilities is linked to non-cognitive human capital aspects (organizational commitment, leadership and customer intimacy).

This paper combines individual dimensions in the study of the content of human capital from a multilevel and microfoundational approach, explaining the effects of emerging human capital on different organizational capabilities when human capital is contextualized at departmental level. This theoretical paper is a new step towards understanding and measuring the concept of human capital, enriching the resource-based view framework.

Utilizando un enfoque multidimensional, este paper teórico tiene como objetivo el diseño de un marco conceptual que explore las dimensiones cognitivas y no cognitivas del capital humano, de cara a explicar cómo puede convertirse en fuente de ventaja competitiva.

En este artículo se presentan varias proposiciones teóricas que pueden ser testadas empíricamente en investigaciones futuras a través de análisis multinivel. Comenzando a un nivel individual, se determinan cuatro configuraciones de capital humano, al considerar las dimensiones cognitivas y no cognitivas. En base a esto, a nivel intermedio o departamental se discuten las interacciones de capital humano, teniendo en consideración la complejidad del entorno de tareas y los procesos psicosociales. Dichas interacciones se convierten en microfundamentos que explican cómo el capital humano puede influir en diferentes capacidades organizativas a nivel de empresa.

El análisis teórico que se realiza nos permite proponer cuatro configuraciones de capital humano al combinar las dimensiones individuales cognitivas y no cognitivas. Estas configuraciones forman un portafolio de capital humano que permiten clasificar cuatro tipos de trabajadores. Además, este artículo muestra cómo se agrega el capital humano individual a nivel departamental, generando procesos de surgimiento del capital humano, los cuales se contextualizan por la complejidad del entorno de tareas y los procesos psicosociales. Dicho proceso de surgimiento nos permite proponer la asociación de capacidades organizativas como la de absorción, innovación y tecnológica, con los elementos cognitivos del capital humano, mientras que un segundo grupo de capacidades organizativas (compromiso, liderazgo, intimidad con el cliente) se asocia a aspectos no cognitivos del capital humano.

Este paper combina las dimensiones individuales del capital humano en el estudio de su contenido, desde una perspectiva multinivel y basada en microfundamentos, explicando los efectos del surgimiento del capital humano en diferentes capacidades organizativas, una vez que dicho capital humano se contextualiza a nivel departamental. Este paper teórico sería un paso más en el conocimiento y medición del capital humano, enriqueciendo el marco de la Teoría Basada en los Recursos.

Usando uma abordagem multidimensional, este paper teórico tem como objetivo a construção dum marco conceptual que explore as dimensões cognitivas e não cognitivas do capital humano, de modo a explicar como se pode tornar em fonte de vantagem competitiva.

Neste artigo apresentam-se várias proposições teóricas que podem ser testadas empiricamente em futuras pesquisas através da análise multinível. Partindo dum nível individual, determinam-se quatro configurações de capital humano, considerando as dimensões cognitivas e não cognitivas. Baseado nisto, a nível intermédio ou departamental debatem-se as interações do capital humano, tendo em consideração a complexidade do ambiente de tarefas e os processos psicossociais. Ditas interações constituem-se em microfundamentos que explicam como o capital humano pode influir em diferentes capacidades organizacionais a nível de empresa.

A análise teórica realizada nos permite propor quatro configurações de capital humano ao combinar as dimensões individuais cognitivas e não cognitivas. Essas configurações formam um portfólio de capital humano que permitem classificar quatro tipos de trabalhadores. Aliás, este artigo mostra como se agrega o capital humano a nível departamental, gerando processos de surgimento do capital humano, os quais contextualizam-se pela complexidade dos ambientes de tarefas e dos processos psicossociais. O desenvolvimento destes processos de surgimento nos permite propor a associação de determinadas capacidades organizacionais como a de absorção, a de inovação e a tecnológica, com os elementos cognitivos do capital humano, enquanto que um segundo grupo de capacidades organizacionais (compromisso, liderança, proximidade com o cliente) está ligado a aspectos não cognitivos do capital humano.

Este paper combina as dimensões individuais no estudo do conteúdo do capital humano desde uma perspectiva multinível e micro-fundacional, explicando os efeitos do surgimento do capital humano em diferentes capacidades organizacionais quando o capital humano se contextualiza a nível departamental. Este paper teórico seria mais um passo no conhecimento e medição do conceito do capital humano, enriquecendo o marco da Teoria Baseada nos Recursos.

The purpose of this paper is to focus on the investigation of the venture capital investment process in the emerging markets of Central and Eastern Europe (CEE), including Hungary, Poland, the Czech Republic, Slovakia, Romania, and Russia. The study aims to describe the mechanics by which venture capital firms operating in the CEE region process deals.

The paper is based on a two‐phase interview interaction process with venture capitalists operating in the CEE region. In the first semi‐structured (exploratory) phase of the study, 14 venture capitalists agreed to participate in one‐hour interview and aimed at discussing their venture capital process. In the second phase of the study (confirmatory), 24 venture capital firms commented on the actual fit of the proposed nine‐stage model into their past investments.

The study has two conclusions. Firstly, the study confirms the existence of a nine‐stage venture capital investment model, comprised of deal origination, initial screening, feedback from the investment committee and due diligence Phase I, feedback from the investment committee (due diligence Phase I), pre‐approval completions, formal approvals and due diligence Phase II, deal completion, monitoring, and exit. Secondly, the proposed model defines the venture capital process in terms of three channels of activity: document channel, information channel, and decision channel.

The study is important for at least four reasons. Firstly, the study focuses on the investigation of the entire venture capital process. Previous research in the area focuses on some specific facets of the venture capital process. Secondly, the paper investigates the connection between decision‐making, information gathering and written communication within a venture capital fund. Thirdly, the study focuses on the most recent period of development of the CEE industry. Many venture capital firms only recently crystallized their venture capital process. Lastly, the study proposes areas of further research for academics and makes suggestions for practitioners.

In the process of cross-border mergers and acquisitions (M&A), the social capital of enterprises is dynamic. In this context, cross-cultural competence plays an important role and can affect the transformation process of social capital and further influence the realisation of M&A performance. However, there is still not enough research on the process of social capital transformation and corporate cross-cultural competence. This study aims to explore the influence mechanism of social capital and the cross-cultural competence of enterprises.

In this paper, four typical manufacturing M&A case studies were analysed and a grounded theoretical analysis process was used to explore the structure of cross-cultural competence and its impact on the dynamic process of social capital.

The results of this study imply that social capital experiences three stages of transformation in the process of M&A. There are also four dimensions of corporate cross-cultural competence, which are composed of various factors. These all affect the dynamic process of social capital through different influence mechanisms.

According to the results, a mechanism model was composed to determine how corporate cross-cultural ability affects the social capital process. This is of practical significance as it can enhance the performance of M&A integration in a cross-cultural context.

To develop a more effective, long‐term‐oriented capital asset management process for capital project evaluation

Relying on a cash study format, the weaknesses of the traditional capital budgeting process are examined. The proposed capital asset management process is contrasted with the traditional process with respect to several aspects of long‐term resource management. Flow‐charts and evaluation matrices are presented.

The capital asset management process offers significant improvements over the traditional process. First, it links various functions that trigger capital requirements. Through an actual versus plan measurement, capital plans become more accurate and predictable. Forecasting beyond one year also enhances the planning and management of resources. Second, the process promotes a more accurate evaluation of costs and benefits of capital projects. The suggested evaluation techniques include detailed qualitative analysis, real option and EVA analyses, and applying project/division costs of capital in place of a company cost of capital.

The capital asset management process provides guidelines to justify and manage capital expenditures in a systematic manner for divisions and product lines within a company. For an effective application, the process should be established across all corporate levels so that top management and project managers have a clear understanding of the process and its importance with respect to a capital proposal's linkage to long‐term strategic goals.

This study provides a comprehensive overview of the traditional capital budgeting process based on an actual company case and presents key drives and evaluation techniques in the capital asset management process to effectively manage firms' long‐term capital assets.

This paper seeks to investigate the impact of intellectual capital elements on business performance, as well as the relationship among intellectual capital elements from a cause‐effect perspective.

The partial least squares approach is used to examine the information technology (IT) industry in Taiwan.

Results show that intellectual capital elements directly affect business performance, with the exception of human capital. Human capital indirectly affects performance through the other three elements: innovation capital, process capital, and customer capital. There also exists a cause‐effect relationship among four elements of intellectual capital. Human capital affects innovation capital and process capital. Innovation capital affects process capital, which in turn influences customer capital. Finally, customer capital contributes to performance. The cause‐effect relationship between leading elements and lagged elements provides implications for the management of firms in the IT industry.

The model proposed in this study is applicable to the high‐tech IT industry. Modification of the proposed model may be needed in applying this model to other industries.

This study helps management identify relevant intellectual capital elements and their indicators to enhance business performance.

This paper is a seminal work to propose an integrated cause‐effect model to investigate the relationship among elements of intellectual capital for IT in Taiwan.