ABSTRACT
Nobel Prize-winning economist Gary S. Becker, who coined the term “human capital,” says that “the basic resource in any company is the people. Loosely speaking, human capital corresponds to any stock of knowledge or characteristics the worker has (either innate or acquired) that contributes to his or her “productivity”. Human capital – the productive capacity that is embedded in people – is one of the most important contributors to the growth in nations’ output and standard of living.

Many organizations in developed countries now are highly dependent on their human capital for their competitive advantage. Their market value increasingly depends on their intangible assets, such as their knowledge, core competencies, and organizational capabilities (Ulrich and Smallwood, 2003)

Globalisation and technological changes have also increased the importance of human capital in recent years, to the point that there are now only two options to sustain high profits and high wages in developed nations: escalating the skill levels of individuals or developing superior capacity for managing those skills and “human capital” more broadly. Employers have responded to these new phenomena by increasing wages for employees with more skills and by increasing their use of downsizing and other methods (such as “offshoring”) intended to reduce labour costs.

Human capital is a valuable concept; it recognizes that people should be treated as assets rather than as an expense. The most successful organisations and the most successful countries are those that manage and actively develop their human capital in the most effective and efficient manner.
It has therefore become imperative that organizations enable, develop and motivate human capital with new level of expertise, new perspectives, new competencies and the implementation of new business policies. All of which are embedded