ABSTRACT
The study focused on the effect of Human Capital Management on Organizational Effectiveness (A Study of Selected Manufacturing Firms in Akwa Ibom State). The specific objectives sought were to: determine the relationship between human capital development and organizational performance in selected Manufacturing firms in Akwa ibom State, ascertain the extent on-boarding enhance organizational efficiency in selected Manufacturing firms in Akwa ibom State, determine the relationship between empowerment and employee performance in selected Manufacturing firms in Akwa ibom State and assess the effect of benefits administration on organizational growth in selected Manufacturing firms in Akwa ibom State. The study had a population size of 3000, out of which a sample size of 353 was using the finite population formula of Godden (2004) the sample size. Instrument used for data collection was primarily questionnaire and interview. Thus out of 352 copies of the questionnaire that were distributed, 312 copies were returned while 41 were not returned. The hypotheses were tested using Chi-square and Z test with the aid of SPSS window 17.0. The results revealed that there is significant relationship between human capital development and organizational performance in selected Manufacturing firms in Akwa ibom State (X2c = 247.519 > X2t = 11.143, p = 0.00 < α = 0.05) and Onbarding to a greater extent enhance organizational efficiency in selected Manufacturing firms in Akwa ibom State (X2C = 298.054 > X2t = 9.348). Also that There is significant relationship between empowerment and employee performance in selected Manufacturing firms in Akwa ibom State (Zc = 6.487 > Zt = 1.96, p = 0.00 < α = 0.05) and there is significant effect of benefits administration on organizational growth in selected Manufacturing firms in Akwa ibom State (Zc =5.657 > Zt = 1.96, p = 0.00 < α = 0.05). The study recommended that manufacturing firms must concentrate on improving their performance by continuous human capital development because the customer expectations and the competition among the manufacturing firms increase with the passage of time.
TABLE OF CONTENTS
Title Page i
Declaration
ii
Certification
iii
Dedication
iv
Acknowledgements
v
Table of Contents
vi
List of Tables
viii
Abstract ix
CHAPTER 1 Introduction
1.1 Background of the Study
1
1.2 Statement of the Problem
1.3 Objectives of the Study
1.4 Research Questions
1.5 Research Hypotheses
1.6 Significance of the Study
1.7 Scope of the Study
1.8 Limitations of the Study
1.9 Brief History of Organizations under
Study
1.10 Operational Definition of Terms
CHAPTER 2 REVIEW
OF RELATED LITERATURE
2.1 Conceptual Framework
2.1.1 Human
capital defined
2.1.2
Fundamental elements of human capital
2.1.3 Uses
of human capital
2.1.4
Sources of human capital differences
2.1.5
Significance of human capital management
2.2 Theoretical
Framework
2.2.1 Human capital theory
2.2.2 Application of human capital theory to organizational
system
2.2.3 Sensitivity of human capital theory
2.2.4 Implications of human capital theory for
organizational development
2.3 Empirical
Review
2.4 Gap in
Literature
2.5 Summary of
Reviewed Related Literature
CHAPTER 3
METHODOLOGY
3.1 Research Design
3.2 Sources of
Data
3.3 Population of the Study
3.4
Sample Size Determination
3.5 Sampling Technique
3.6 Description
of Research Instrument
3.7 Validity of the Research
Instrument
3.8 Reliability of the
Research Instrument
3.9 Method of Data Analyses
CHAPTER 4 DATA PRESENTATION AND ANALYSIS
4.1 Return Rate of Questionnaire
4.2 Data Presentation
4.3 Test of Hypotheses
4.4 Discussion of Results
CHAPTER 5 SUMMARY OF FINDINGS, CONCLUSION AND
RECOMMENDATIONS
5.1 Summary of Findings
5.2 Conclusion
5.3
Recommendations
5.4 Area of Further
Studies
References
Appendices
LIST OF TABLES
3.1 The Study Population
3.2 Breakdown of
the Sample Size
3.3 Cronbach Alpha
Validity and Reliability Test
4.1 Return Rate of
Questionnaire
4.2 Staff
Position
4.3 Length of Period to
Service 4.4 Academic Qualifications of Respondents
4.5 Chi-Square
Test
4.6 Chi-Square
Test
4.7 One-Sample
Kolmogorov-Smirnov Test
4.8 One-Sample
Kolmogorov-Smirnov Test
CHAPTER 1
INTRODUCTION
1.1 BACKGROUND OF
THE STUDY
The thrust of human capital management is entirely that of
improving how organizations employ, deploy and evaluate their workforce. According
to Youndit (2000), since organizations are undergoing fundamental shifts in the
ways they conduct business; effective organizations must however view the above
thrust seriously. In current global market, companies
are composed by competitors, regardless of industry. 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 cum management not only to achieve business goals but most important
is for a long term survival and sustainability. To accomplish this undertaking,
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.
In
response to the changes, most firms have embraced the notion of human capital as
a good competitive advantage that will enhance higher performance. Human
capital development and management becomes a part of an overall effort to
achieve cost-effective and firm effectiveness or 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’ effectiveness or performance, the notion of
performance for human capital remains largely untested.
According
to Schultz (1993), the term “human capital” has been defined as a key element
in improving a firm assets and employees in order to increase productive as
well as sustain competitive advantage. To sustain competitiveness in the
organization human capital becomes an instrument used to increase productivity.
Human capitals refer to processes that relate to training, education and other
professional initiatives in order to increase the levels of knowledge, skills,
abilities, values, and social assets of an employee which will lead to the
employee’s satisfaction and performance, and eventually on a firm performance.
Rastogi (2002) posits that human capital is an important input for
organizations especially for employees’ continuous improvement mainly on
knowledge, skills, and abilities. Thus, the definition of human capital is
referred to as “the knowledge, skills, competencies, and attributes embodied in
individuals that facilitate the creation of personal, social and economic
well-being” (Organization for Economic Co-Operation and Development or OECD,
2001).
Bontis (2001) defines human capital as the combined knowledge,
skill, innovativeness and ability of the company’s individual employees to meet
the task at hand. To develop human capital in-house or acquire human capital
from the external labor market, firms implement human resource management (HRM)
practices, particularly, staffing, training, performance appraisal, and rewards
(Snell and Dean, 1992). These practices are universally considered as the
investments for human capital development through which firms increase their
economic value.
The
constantly changing business environment requires firms to strive for superior
competitive advantages via dynamic business plans which incorporate creativity
and innovativeness. This is essentially important for their long term
sustainability. Undoubtedly, human resource input plays a significant role in
enhancing firms’ competitiveness. At a glance, substantial studies were carried
out on human capital and their implications on firm performance were widely
covered and obviously, human capital enhancement will result in greater
competitiveness and performance (Agarwala, 2003).
1.2 STATEMENT OF THE PROBLEM
Despite
the increasing level of competition in the global organization especially
banking industry, very little attention has been given towards developing, and
management of human capital. The banks thus become vulnerable to competitive
forces or edge and changing trends in workforce demand. This poor attitude to human capital management
has retard the growth and performance of the organization significantly. These actions
of gross negligence culminate to low interest in employee empowerment which in
a long run affect the organizational effectiveness and performance.
1.3 OBJECTIVES OF THE STUDY
The broad objective of this study is to
investigate the effect of human capital management on organizational
effectiveness with particular reference to selected Manufacturing firms in Akwa
ibom State. The specific objectives are:
1. determine the relationship between human capital development and
organizational performance in selected
Manufacturing firms in Akwa ibom State.
2. ascertain the extent on-boarding enhance organizational efficiency in selected Manufacturing firms in Akwa ibom
State.
3. determine the relationship between empowerment and employee
performance in selected Manufacturing
firms in Akwa ibom State.
4. Assess the effect of benefits administration on organizational
growth in selected Manufacturing firms
in Akwa ibom State.
1.4 RESEARCH QUESTIONS
The
following research questions will guide this study:
1. What is the nature of the relationship
between human capital development and organizational performance in selected Manufacturing firms in Akwa ibom
State?
2. To what extent does on-boarding enhance
organizational efficiency in selected
Manufacturing firms in Akwa ibom State?
3. What is the nature of the relationship
between empowerment and employee performance in selected Manufacturing firms in Akwa ibom State?
4. What is the effect of benefits
administration on organizational growth in
selected Manufacturing firms in Akwa ibom State?
1.5
RESEARCH HYPOTHESES
The following alternate hypotheses were
formulated for this study.
Ho1:
There is no significant relationship between human
capital development and organizational performance in selected Manufacturing firms in Akwa ibom
State.
Ho2: Onbarding to a greater extent does not enhance
organizational efficiency in selected Manufacturing firms in Akwa ibom State.
Ho3:
There is no
significant relationship between empowerment and employee performance in selected Manufacturing firms in Akwa ibom
State.
Ho: There is no
significant effect of benefits administration on
organizational growth in selected
Manufacturing firms in Akwa ibom State.
1.6 SIGNIFICANCE OF THE STUDY
This
study will be of immense significant in a number of ways:
The Manufacturing firms: The outcome of this study will be of immense benefit to the
employers and employees of the manufacturing firms because the knowledge and
development of human capital will enable them build pull of their successors as
well increase their effectiveness.
Researcher: The study of this nature will assist future researchers/ students who
wish to carryout a further study in this area.
1.7 SCOPE OF THE STUDY
The study concentrates on
the effect of human capital management on organizational effectiveness with
special interest to Manufacturing firms in Akwa ibom State. The content scope focuses
on human capital development and organizational effectiveness, onboarding and organizational
efficiency, empowerment and
organizational performance, and benefits administration in selected Manufacturing firms in Akwa ibom
State.
1.8 LIMITATIONS OF THE STUDY
This study is limited by the following
factors.
Time Factor: However,
one of the reasons for restricting the area of this study to Enugu state was
time; as a result some of the places where data and relevant information could
have been obtained were not visited. The researcher has to manage her time and
reset her priorities in order to circumvent the challenge.
Attitude of the Respondents: Some of the respondents show negative attitude towards the study because
they did not want to disclose the secret of their organizations. Familiarity
was established by the researcher and assured confidentiality of the information.
Methodological
Constraints:
This research focused on the key factors and best practices that lead to
the effect of human capital management and organizational effectiveness. Thus
technique adopted at any given study is peculiar and otherwise can be
replicated differently.
1.9 PROFILE OF
ORGANIZATIONS UNDER STUDY
1. Champion
Breweries
Champion
Breweries has its Head Office situated beside a major road leading to Eket
Local Government Area – Akwa Ibom road opposite the Aka Community Secondary
School, Uyo. The Champion Breweries
Limited was commissioned and started firming business in 1993.
Champion Breweries Plc, formerly Champion Breweries
Limited, is a Nigeria based company, which is engaged in brewing business. The
Company’s principal activity is to carry on the business of brewing and
marketing of alcoholic and non-alcoholic beverages in Nigeria, as well as
provide contract brewing and packaging services to Nigerian Breweries Plc. The
Company is involved in the brewing and marketing of Champion Lager Beer and Champ
Malta. The Company operates in the Nigeria geographical segment.
Champion Breweries Plc is an established brewery in
Nigeria manufacturing Champion Lager Beer and Champ Malta as well as a
selection on non-alcoholic beverages. They began manufacturing in 1976 with a
capacity of 150,000 hecto litres of Champion beer and 10,000 hecto litres of
Champ Malta. The company also brews and packages products under contract to
Nigerian Breweries Plc. The main brands in its product portfolio are Champion
Lager Beer and Champ Malta. Champ Malta is a flavoured beer with a golden
colour and distinct aroma. The company has undergone a number of name changes;
established as South East Breweries Limited, the name changed to Cross River
Breweries Limited and thereafter to Champion Breweries Limited which was later
changed to Champion Breweries Plc. In 2011, consolidated Breweries acquired a
57% equity stake in Champion Breweries which was originally held by Montgomery
Ventures Inc (Panama). In 2013, Raysun Nigeria Limited, a wholly-owned
subsidiary of Heineken, purchased Consolidated Breweries and now holds a
majority equity stake in Champion Breweries Plc. The company’s head office is
in Akwa Ibom state, Nigeria.
2. JUBILEE SYRINGE
MANUFACTURING COMPANY LIMITED
Jubilee Syringe Manufacturing Company Limited is a
manufacturing company established for the purpose of producing disposable
syringes for medical companies. Jubilee Syringe Manufacturing Company which,
sits on a 40,000 square meter (sqm) land area in Onna Local Government of Akwa
Ibom State, was commissioned in September by Acting President Yemi Osinbajo. The
global disposable syringe market is expected to reach $7.5 billion (N2.6
trillion) in 2022 according to transparency market research. Disposable syringes are the most consumed
medical devices in the world.
An estimated 39 billion units were sold in 2013, with
a market value of approximately $4.93 billion.
The disposable syringe market has been segmented into two major types:
safety syringes and conventional syringes. With projected annual earnings of
about $1.5 million (N5.5 billion). Jubilee Syringe Manufacturing Company hopes
to initially take 500 Nigerian youths of the congested labour market, with
further commitment to grow the numbers. The Akwa Ibom syringe factory is the
largest syringe factory in Africa, it has the capacity to produce 350 million
to 400 million units of 2ml, 5ml, and 10ml disposable syringes annually and
overshoots that of a company in South Africa which has a production capacity of
$3 million thereby making jubilee syringe the largest syringe manufacturing
company in the entire African continent.
The production target is to double to 700 million-800
million units in the first year of operation and one billion units in the
second year of operation. So far,
hundreds of youths have been employed and taken off the congested labour market
with further commitment to grow the number to thousand. The ultimate goal is
not only to make Nigeria self-sufficient in syringe production, but also a net exporter
of syringe and other medical devices to other countries. During the
inauguration of the syringe factory, Vice President Yemi Osinbajo described
Governor Udom Emmanuel as one of the most “innovative creative and cleverest”
person he has ever seen.
1.10 OPERATIONAL DEFINITION TERMS
Human capital:
represents the human factor in the organization; the combined intelligence,
skills and expertise that gives the organization its distinctive character.
Human Capital
Management: is concerned with obtaining, analyzing
and reporting on data that inform the direction of value-adding people
management, strategic, investment and operational decisions at corporate level
and at the level of front line management.
Human
Capital Development
recognizes that the development and growth of people in organization and
business is an important and essential asset to the organization.
Empowerment:
is a management
practice of sharing information, rewards, and power with employees so that they
can take initiative and make decisions to solve problems and improve service and
performance.
On-boarding is
a human resources industry term referring to the process of introducing a newly
hired employee into an organization.
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