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How Human Capital Affects Organizational Success

Author:, August 6, 2020/Categories: Blogs

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Human capital can be defined as the expertise, skillsets, and attributes possessed by an individual, which in turn creates economic value for the organization. Over the last decade, most organizations have realized that human capital development is crucial to an organization’s performance. Human capital services have emerged as the key to both, wealth creation and gaining sustainable competitive advantage. The concept of knowledge-economy has led to an increase in the percentage of human capital in GDP.

Intangible assets, especially human capital, affect the market value of organizations in a major way. So there has been a tremendous emphasis on the human capital search to improve the quality of hire. The bars for organizational learning have been raised beyond mandatory e-learning to create a work environment where knowledge is shared and applied in practice. Human capital development can be assessed through

• Optimization of workforce
• Leadership quality
• Accessibility of knowledge
• Learning capacity

Some of the factors that are affected by human capital which ultimately leads to organizational success are

In the current global business landscape, it is important for companies to keep on adapting to the present circumstances to accomplish their targets. So, human capital development in every organization should focus on building an innovative workforce.

Successful organizations are using knowledge management to scale up their business. Knowledge management is a combination of human capital, information technology, organizational performance, etc. The knowledge and skills of the workforce are directly related to the growth of an organization.

Human capital search looks for employees who can add value to the organization by being able to design strategic plans and implement them. Proper training and motivation of employees helps to create value and increase productivity.

Competitive advantage-
For an organization to have a competitive advantage, it should be able to differentiate its products and services from the market solutions. Human capital services ensure that the employees have the required intellect, creativity, and flexibility to deliver quality work which would help the process.

Retention rate-
If the human capital services of an organization are providing existing employees with career advancement opportunities, they will stay in the company. Improved retention rates will increase the number of loyal employees. If a person is working in the same organization for a long duration, he/she will be familiar with the organizational culture and practices and will be able to deliver the output more efficiently.

Customer satisfaction-
The level of customer satisfaction is directly proportional to the quality of human capital. The attitude, experience, and competence of the employees determine the type of service relationship with the customers. Good resources have a high chance of forging a positive relationship with the customers, which would benefit the company both in the short and long run.

Human capital development plays an important role in an organization’s growth, productivity, and efficiency. To reap the best benefits from it, every company needs to actively invest in human capital services. Despite the growth in artificial intelligence, human capital still remains very important to an organization because every organization requires human capital to reach their goals.

At The Taplow Group we have extensive experience in designing, delivering and benchmarking Human Capital projects in addition to Human Capital Search, to ensure our clients fully realize their employees’ full potential. Get in touch with us today at


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