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Abstract
The study examined the effect of human capital development on organizational performance. The descriptive survey design was the most appropriate for this study. The population of this study is made up of all the management and junior staff of selected commercial banks in Rivers State which include First Bank of Nigeria Plc, Zenith Bank Plc, Sterling Bank Plc. The researcher draws a sample size of one hundred and ten staff (110) respondents using non-probability sampling technique. The Yaro Yemen’s formula was used to determine the sample size of 88. A self-design questionnaire on human capital development and organizational performance was used specifically for data collection. The chi-square (X2) statistical tool was used to test the hypotheses. Findings revealed that there is a significant effect of human capital development on organizational performance in selected commercial banks in Rivers State. The study recommended that human resources training and development should be adopted in our organizations hence it will enhance development performance because these employees even when they are the right people at the job need to be updated and modifies considering our dynamic environment, also Wages and other financial benefits of employees should be structured and upwardly reviewed when an employee has gone for firms or development by management for employees to improve on their level of productivity.
Table of Contents
Title Page i
Declaration iii
Certification iv
Dedication v
Acknowledgement vi
Abstract vii
Table of Contents viii
List of Tables x
List of Figures xi
CHAPTER ONE 1
INTRODUCTION 1
1.1 Background of the Study 1
1.2 Statement of the Problem 2
1.3 Objectives of the Study 2
1.4 Research Question 3
1.5 Research hypotheses 3
1.6 Significance of the Study 3
1.7 Scope/Limitation of the Study 4
1.8 Definition of Terms 5
CHAPTER TWO 7
LITERATURE REVIEW 7
2.1 Conceptual Framework 7
2.1.1 Concept of Human Capital Development 7
2.1.2 Dimensions of Human Capital Development 8
2.1.3 Organizational Performance 9
2.1.4 Measures of Organizational Performance 10
2.2 Theoretical Review 11
2.2.1 Human Capital Theory 11
2.2.1 Resource Based View (RBV) 12
2.2.2 Growth Theory 12
2.2.3 Modernization Theory 13
2.3 Empirical Review 13
CHAPTER THREE 18
RESEARCH METHODOLOGY 18
3.1 Research Design 18
3.2 Population of the Study 18
3.3 Sample and Sampling Techniques 18
3.4 Questionnaire Design 19
3.5 Sources and Method of Data Collection 20
3.6 Data Analytical Techniques 20
3.7 Reliability and Validity 21
CHAPTER FOUR 23
DATA PRESENTATION AND ANALYSIS 23
4.1 Data Collection and Presentation 23
4.2 Data Analysis 24
4.3 Testing of Hypothesis 28
4.4 Discussion of Findings 31
CHAPTER FIVE 34
SUMMARYS, CONCLUSIONS AND RECOMMENDATIONS 34
5.1 Summary 34
5.2 Conclusion 34
5.3 Recommendation 35
References 37
Appendix I 39
Appendix II 40
CHAPTER ONE
INTRODUCTION
1.1 Background of the Study
The main objective of every business is to maximize profit. This major goal cannot be achieved without conscious investment on human capital to have the quality of employees that will enable the organization achieve it corporate objectives. According to Odhong et al., (2013), human capital was defined by Bontis et al., (1999) cited in Baron and Armstrong (2007) as the combined intelligence, skills and expertise that gives the organization its distinctive character. Carnegie (1919) as cited by Ismaila (2013) notes that, “the only irreplaceable capital an organization possesses is the knowledge and ability of its people. The productivity of that capital depends on how effectively people share their competence with those who use it”. The banks in Nigeria are well known for a common phrase which says “our employees are our greatest asset”. If this assertion is critically evaluated, the said greatest asset has not been given the required attention that could bring out the best in an employee. The highest recruiting industry in Nigeria is the banking sector. Basically, they now recruit the First class graduates from the universities and also professionals in IT and finance. One expects proper motivation and attractive welfare package for these quality of human capital who spend the useful part of their lives working and maximizing shareholders values. However the reverse has always been the case. The issue of human capital development in banking industry is all about investing in improving the skill, innovation and technical capability of the workforce to enhance productivity. This is not restricted to workers alone but extends to even the employers/entrepreneurs because they too need to develop themselves for more efficiency and effectiveness in the management of physical and other human resources. This study therefore, examined the effect of human capital development on the performance of banks by studying Three (3) selected banks in Nigeria which include; First Bank of Nigeria Plc, Zenith Bank Plc, Sterling Bank Plc.
1.2 Statement of the Problem
The economic downturn and general reforms in Nigerian financial sector triggered the merger of banks which consequently brought about the down-sizing of their staff strength. To send staff on off-job training now becomes difficult due to tight working schedule. Most bank employees find it difficult to get release for further studies. Financial targets become the order of the day. Even where banks commit enormous financial resources to staff training and development, staff health care and other personnel benefits become an issue. Besides, one thing is to acquire additional knowledge and skill, another thing is to have the required motivation to use the human capital acquired to bring about improved productivity. Therefore, there is need to investigate the effect of human capital development on financial performance of banks.
1.3 Objectives of the Study
The main objective of the study is to examine the effect of human capital development on organizational performance in selected commercial banks in Port Harcourt. The specific objectives are as follows:
- To examine the relationship between staff training and organizational performance in selected commercial banks in Port Harcourt, Rivers State.
- To examine the relationship between staff development and organizational performance in selected commercial banks in Port Harcourt, Rivers State.
- To examine the relationship between employee coaching and organizational performance in selected commercial banks in Port Harcourt, Rivers State.
1.4 Research Question
With the above objectives in focus, the study seeks to find answers to the following questions:
- Does staff training associate with organizational performance in selected commercial banks in Port Harcourt, Rivers State?
- Does staff development associate with organizational performance in selected commercial banks in Port Harcourt, Rivers State?
- Does employee coaching associate with organizational performance in selected commercial banks in Port Harcourt, Rivers State?
1.5 Research hypotheses
The following hypotheses were formulated to guide the study:
HO: There is no significant effect of human capital development on organizational performance in selected commercial banks in Rivers State.
1.6 Significance of the Study
The study made use of three (3) reputable banks which is a good representation of the banking sector in Nigeria. The work stands to give bank managers an insight into the relevance of human capital development which will help to improve the financial performance of their organizations. The employees will also see the need for proper career development in terms of possessing more expertise and relevant skills to face challenges in their jobs. Future researchers will also find the data used for this study very useful for further studies.
1.7 Scope/Limitation of the Study
The scope of this study is delimited into the followings:
Content Scope: The specific areas of organizational performance the study investigated include; profitability, efficiency and effectiveness. Whereas, the areas of human capital development includes staff training, staff development and coaching.
Geographical scope: This study covers an examination of strategic contributions of human capital development on organizational performance.
Unit of Analysis: This is a macro study because it is interested in ascertaining the performance of an organization in this direction. Hence, it is a micro level study.
The major limitation of the study is the short time frame the research lasted, coupled with the tight academic time table, which prevented a very comprehensive study. The fund available to the researcher was also limited and therefore the study was limited to a small portion of the survey population.
Another limitation is the difficulties, encountered by the researcher in obtaining all needed information and materials from the right source and computation of data for the project.
1.8 Definition of Terms
Human Capital Development
Human capital is an intangible assets that creates future economic value, which include the competencies of front-line employees and the organizational capabilities.
Staff training
Staff training is a planned effort by an organization to facilitate the learning of job related to knowledge and skills by its employees to improve employee’s performance and further organizational goals.
Staffs Development
Development takes the form of learning activities that prepare people to exercise wider or increased responsibilities.
Coaching
Coaching and mentoring can provide an array of benefits for organizations of all sizes, especially small businesses. When conducted in an efficient and productive manner, coaching and mentoring provides employees a way to connect, learn and grow within the company and along their own career paths.
Organizational Performance
Organizational performance is most often defined as (1) a strong desire to remain a member of a particular organization; (2) a willingness to exert high levels of effort on behalf of the organization; and (3) a definite belief in, and acceptance of, the values and goals of the organization.
Profitability
Profitability is the state of yielding financial profit or gain. It is often measured by price to earnings ratio.
Efficiency
It is the ability to avoid wasting materials, energy, efforts, money, and time in doing something or in producing a desired result. In a more general sense, it is the ability to do things well, successfully, and without waste.
Effectiveness
Organizational effectiveness is defined in many ways depending on the organizations goals and objectives in today’s market and also is dependent on the industry.
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