CHAPTER ONE

INTRODUCTION

 1.1 Background to the Study

It is obvious that, organizations cannot achieve its objectives despite great improvement in automation, if the desired human capital development is not accomplished. This forms the basis why most organizations in our modern society engage people. Human capital needs to be developed effectively since they are the most dynamic of all organizational resources. They need considerable attention from the organizations management if there are to fully realize their potentials in their work.

There are private and public organizations. Change is a part of organizational life and to cope with it, management of the organization must continue to strive to put up training programe and career management to retain their employees.

For any organization to attain superior performance, it must have capable, efficient, well developed and satisfied employees.

Hence, the need for human capital development. Its important to note that before industrial revolution era, employees were not appreciated and recognized as important resources for better performance in the organization. The relationship between the management and staff was merely that of the master and slave.

However, today human capital development is a modern phenomenon in the field of business management because organizations have come to realize that in order to effect supervisor performance, that best reliable employees must be extracted.

Human capital development covers a wide range of activities though. It is expensive to train and develop human capital in today’s business environment, every organization must strive to work towards it. Education, on-the-job, off-the-job training, recreational activities, such as sports, social clubs are the means where investments in employees are carried out. It also covers issues like motivation, work restructuring, payment systems, and communicating leadership and so on. Management must therefore seek to tackle these various areas to develop its staffs effectively for superior organizational performance.

The impact of human capital development is enormous. It has brought increase in productivity and quality of work life of the staffs. Its importance can not be over emphasized. It should be the goal and vision of every organization to develop its employees for greater accomplishment of its set objectives.

1.2 Statement of the Problems

Undoubtedly, every organization cannot perform well if its human capital is not effectively developed. However, the problems that make the researcher into this study are stated below:

Q Poor organization performance due’ to inefficient methods of human capital development.

Q Decrease in the profitability rate of a business organization

Q Inability to innovate products as a result of the inefficiency of the human capital.

Q Poor services rendered to customers due to inefficient human capital development.

Q Poor market share and inability to accumulate assets in the organization

Q Inability of an organization to meet up with its competitors as a result of inefficient development of its human capital.

Q Low productivity due to poor human capital development.

1.3 Objectives of the Study

The purpose of this research study is to find out the impact of human capital development on organizational performance. Specifically, the study sought to:

i.        To ascertain whether or not human capital development brings about increase in productivity.

ii.       To verify whether the organization embark on human development.

iii.     To find out the problems of human capital development

iv.     To ascertain the prospects of human capital development.

1.4 Statement of Hypotheses

     The following hypotheses will be tested in order to adequately analyze the impact of effective human capital development on organizational performance. The null and alternative hypotheses are:

Hypothesis One

Ho: Effective human capital development has not increased significantly the profitability margin in a business organization.

Hi: Effective human capital development has increased significantly the profitability margin in a business organization.

Hypothesis Two

Ho: Effective human capital development has not promoted the innovation of new product in a business organization.

Hi: Effective human capital development has promoted the innovation of new product in a business organization.

Hypothesis Three

Ho: Effective human capital development has not brought about assets accumulation and return on equity in a business organization.

Hi: Effective human capital development has brought about assets accumulation and return on equity in a business organization.

Hypothesis Four

Ho: Effective human capital development has not provided satisfaction to customers in a business organization.

Hi: Effective human capital development has provided satisfaction to customers in a business organization.

Hypothesis Five

Ho: Effective human capital development has not brought about better liquidity ratio in a business organization.

Hi: Effective human capital development has brought about better liquidity ratio in a business organization.

1.5 Significance of the Study

The significance of this study is to enlighten stakeholders in the banking industry and other organizations on the need to harness the available resources in the right direction in order to better organizational performance. Also, this study is to educate academia on the relevance of human capital development to superior performance of institutions.

It is also meant to assist students of research on similar topics. Essentially, this research is to guide against the management of any organization on the need to develop its employees in order to perform effectively towards achieving the desired objectives.

1.6 Scope and Limitations of the Study

       In an attempt to carry out this study, it was necessary to have a concentrated area of study. The scope of this research work is restricted to the importance of human capital development towards organizational performance with a case study covering Mainstreet Bank Akpa, Kogi State.

      Several constraints were encountered in the course of carrying out this research work. These constraints or limitations are as follows:

i.    Lack of adequate finance constitutes a major constraint.

ii.   Lack of time affected the research work

iii. Some respondents were redundant to give responses to the research question.

iv. Some of the questionnaire were returned late

v.   Non cooperative refuse attitude of some other managers who refuses to give information about the organization.

1.7 Definitions of Key Terms

        To enhance easy and better comprehensive and understanding, the following terms which ran through the length and breath of this research will be briefly defined:

Impact: To have an important or noticeable effect on something or someone.

Effective: it means ability to luring about the intended result. It is the achievement of the desired objectives.

Development: it is a change from present state to the desired state. It has to do with the total transformation of the entire system.

Human Capital: Human capital is used here to refer to any human resources or manpower that is available to met up with the demand for labour used in production.

Training: Training means preparation for special skills. It is the organizational efforts aimed at helping an employee to acquire the basic skill require for better superior performance of his basic functions.

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