Human resource management practice I also available by michael armstrong

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05

Human capital 

management

LearnIng outComes

On completing this chapter you should be able to define these key concepts. You should 

also understand:

 

●

The nature of human capital 

management

 

●

The concept of human capital

 

●

Characteristics of human capital

 

●

Constituents of human capital

 

●

Significance of human capital theory

 

●

Importance of human capital 

measurement

 

●

Reasons for interest in human capital 

measurement

 

●

Approaches to measurement

 

●

Measurement elements

 

●

Factors affecting choice of 

measurement

 

●

Criteria for HCM data for managers

Key ConCePts and terms

Balanced scorecard

Human capital

Human capital advantage

Human capital index – Watson Wyatt

Human capital management

Human capital measurement

Human capital monitor – Andrew 

Mayo

Human process advantage

Intangible resources

Intellectual capital

Metrics

Organizational capital

Organizational performance model 

– Mercer HR Consulting

Social capital

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Part 

1

  The Practice of Human Resource Management

68

Introduction

As  defined  by  Baron  and  Armstrong  (2007:  20), 

human  capital  management  (HCM)  is  concerned 

with  obtaining,  analysing  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.  It  is,  as  emphasized  by  Kearns 

(2005), ultimately about value.