Role of Human Capital in Organizational Performance: A Theoretical Framework

Abstract

Human capital (HC) is embodied with resource relate to all competence, creativity and innovation, commitment, experience, morale and responsiveness to the organisation for which employees work individually and collectively. This pool of resources is a treasure which does attain the goals of any organisation. However, in Indian business scenario, considering human capital and its description towards organisational goal is still imprecise and thus requires a lot of attention. In present cutthroat environment, managing human capital has become a herculean task in public as well as private organisations. Human capital is to be maintained productively to support in all alarming areas. Strategic planning of human capital has thus become a need in every aspect of life. Furthermore, human capital can lead to organisational performance (OP) only if employee retention happens to be feature in the organization. Retention (RE) is a colossal affair in the corporate houses and more a strategic aspect of both public and private organisations. Strategically it is imperative to retain the best talent. Review of literature shows positive but complex linkage between human capital and organisational performance. This study is critically delved into this relationship with regard to retention of employees. This study may also be helpful for any human capital strategists enforcing exceptional good retention policies for organisational effectiveness.

Keywords: Human Capital, Organisational Performance, Retention

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