An intellectual capital perspective of human resource strategies and practices

Abstract

Previous research has investigated the relationships between intellectual capital (IC) and human resource management (HRM). Others have described the link between IC and strategic initiatives in an organization including strategic human resource management (SHRM). However, little systematic work has been done to develop a holistic overview of connections between the three concepts. Through an analysis of the recent IC literature and the literature that discusses IC, SHRM and HRM, this paper argues that not only are the three concepts closely connected, but also IC should play a key role in SHRM processes and HRM practices in organizations. The strategic connections also demonstrate that IC can be conceptualized as a holistic partner to both SHRM and HRM; thus, adding strong support for the need to measure IC accurately. A theoretical framework is proposed to illustrate IC, SHRM and HRM connections. Finally, the paper suggests directions for future research.

Knowledge Management and Intellectual Capital - A Theoretical Perspective of Human Resource Strategies and Practices

“…Individual knowledge residing in routines, processes and analysis -argued to be a static internal resource that can be controlled, exploited and traded like most physical resources in an organization (Kong and Thomson, 2009;Kong, 2008) -possesses tacit dimension, according to Leonard and Sensiper in Polanyi (1969). Concerning the tacit, Berman et.…”

“…Mostly, the forms of innovation and competitive advantages may be manifested through specific and effective business strategies such as producing product innovation, expanding market areas, improving a quality of services and a quality of processes of production, developing better systems of organization, and applying a particular budget saving. These strategies, identified as resource-based view (RBV), implies internal and external aspects, which provides the firm a potential of sustained competitive advantages over other competitors (Kong and Thomson, 2009). Since limitation and similarities of the external aspects -such as natural sources, technology, skillful and professional workers, the internal aspects (namely: human capital, structural capital, relational capital, organizational system, innovation, and knowledge management) offer valuable and uniqueness of the firm to support and develop competitive advantages.…”

“…Focusing on rare, imperfectly imitable and non-substitutable characteristics of resources, the internal aspects of the firm such as knowledge management (KM) and intellectual capital (IC) should be the center of strategic analysis (Kong & Thomson, 2009;Bontis, 2002;Rumelt, 1991;Nelson, 1991). Recent studies suggest knowledge is a critical strategic resource for organization even though some consider the human resources is not specifically deal with developing and supporting competitive advantages.…”

“…Respectively, other researches have investigated the links between IC and strategic and practical human resources management. For example, Kong and Thomson (2009) point out that strategic human resource management (SHRM) entails on IC. Importantly, human capital exists in human resources in the form of cumulative tacit knowledge and human skills through a sequence of HRM functions such as employee selection, development and deployment (Snell & Dean Jr., 1992).…”

“…Consequently, the knowledge serves valuable and crucial asset for the firm. This idea brings the knowledge become an extension of the RBV; Kong & Thomson (2009) call it knowledge-based view (KBV).…”