Human capital investment selection criteria: Who is worth the investment?

Abstract

Orientation: Employee investment is an important contributor to advancing both the employee and the organisation. Using the correct criteria to select employees to participate in a human capital investment (HCI) initiative is vital.

Research purpose: The purpose of the study was to explore the impact of HCI within an organisation and to understand how selection criteria are determined and applied when selecting knowledge assets in which to invest. The study also aimed to formulate recommendations on suitable selection criteria for HCI beneficiaries.

Motivation for the study: The ability to effectively identify relevant skills to invest in provides an opportunity to leverage employees’ innovation capacity, crucial in the development of commercial products and the improvement of business processes.

Research approach/design and method: A qualitative, interpretive research design was adopted within the phenomenological paradigm. Eight semistructured interviews were conducted with purposively selected participants. Data were analysed using thematic analysis while all ethical protocols were observed.

Main findings: The findings reveal a disparity in perceptions regarding criteria used in the application and selection process of HCI beneficiaries. The findings also reveal the risks and benefits of HCI programmes for both the employee and the organisation.

Practical/managerial implications: Standardised procedures, processes and criteria, aligned to organisational strategy and for the purpose of employee development and succession planning, should be clearly formulated and communicated to all the stakeholders.

Contribution/value-add: Recommendations are made to management, human resources practitioners and researchers on ensuring effectively developed HCI initiatives.