Human Capital Return-on-Investment (HCROI) in South African companies listed on the Johannesburg Stock Exchange (JSE)

dc.contributor.advisorDe Kock, F. S.en_ZA
dc.contributor.authorViljoen, Hendrina Helenaen_ZA
dc.contributor.otherStellenbosch University. Faculty of Economic and Management Sciences. Dept. of Industrial Psychology.en_ZA
dc.date.accessioned2012-03-14T09:20:25Zen_ZA
dc.date.accessioned2012-03-30T10:37:29Z
dc.date.available2012-03-14T09:20:25Zen_ZA
dc.date.available2012-03-30T10:37:29Z
dc.date.issued2012-03en_ZA
dc.descriptionThesis (MComm)--Stellenbosch University, 2012.en_ZA
dc.description.abstractENGLISH ABSTRACT: The management of human capital requires meaningful measures of human capital effectiveness that enable better strategic human resource decision-making. Existing measures, such as Human Capital Return on Investment (HCROI), allow human resource managers to quantify the bottom-line impact of human capital expenditure, but little is known about how HCROI varies within the population of listed companies. As a result, users of these metrics rarely know how they ‘measure up’ against their competitors in the absence of normative information. If human capital is considered a source of competitive advantage, measures of human capital effectiveness should also allow for normative comparisons. The present study extracted audited financial data from McGregor BFA (2010) and described the central tendency and dispersion of HCROI of Johannesburg Stock Exchange (JSE) listed companies (N = 319). In doing so, it established a set of benchmarks for human capital effectiveness measures across industry and company size categories, as well as described temporal changes over the financial years surveyed (2006 - 2010). Even though South Africa is considered to have a very low labour force productivity level compared to other countries (Schwab, 2010 in World Competitive Report, 2010/2011), the results showed that the grand median HCROI ratio for South African listed companies was higher (M = 3.03) than those from published figures from the USA, EU and UK (PwC Saratoga, 2011). This descriptive research also explored the influence of company size (small, medium or large) and company industry (N = 42) on human capital effectiveness (as indexed by HCROI). No statistically significant differences (p > .05) between the median HCROI ratios across company size categories were found, although notable differences in medians of HCROI across company industry categories were observed. HCROI also showed temporal fluctuations over the study period, reflecting economic cycle influences, but year-on-year changes were bigger when the mean HCROI was used — median HCROI remained relatively stable year-on-year. From the research, several recommendations are made regarding the appropriate use of these HCROI benchmark data. Also, this descriptive study lays a solid foundation for future explanatory research aimed at investigating the antecedents, correlates and consequences of human capital return-on-investment (HCROI) as an indicator of human capital effectiveness. The present study contributes to human capital metrics literature by demonstrating how human capital effectiveness indicators can be calculated from audited financial results available in the public domain, and in doing so, attempts to encourage greater use of human capital reporting in financial reporting standards.en_ZA
dc.description.abstractAFRIKAANSE OPSOMMING: Die bestuur van mensekapitaal vereis betekenisvolle metings van menskapitaaleffektiwiteit wat beter strategiese menslike hulpbron-besluitneming tot gevolg het. Bestaande metings, soos Menskapitaalbeleggingsopbrengs (HCROI), laat menslike hulpbronbestuurders toe om die finansiële impak van die menskapitaaluitgawe te kwantifiseer, maar min is bekend oor hoe menskapitaalbeleggingsopbrengste tussen die populasie van gelyste maatskappye varieer. Die gevolg is dat die gebruikers van hierdie metrieke aanduiders (metrics) selde weet hoe hulle ‘opmeet’ teen hul mededingers in die afwesigheid van normatiewe inligting. Indien menskapitaal as ‘n bron van ykmerk (benchmark) oorweeg kan word, moet die meting van menskapitaaleffektiwiteit ook normatiewe vergelykings toelaat. Die huidige studie het geouditeerde finansiële data vanaf McGregor BFA (2010) onttrek en die sentrale neiging en verspreiding van menskapitaalbeleggingsopbrengs van die maatskappye wat op die Johannesburgse Effektebeurs gelys is (N = 319), beskryf. Sodoende het dit ‘n stel ykmerke vir menskapitaaleffektiwiteit-metings daargestel oor die industrie- en maatskappy-grootte kategorieë heen, sowel as om reële veranderinge oor die finansiële jare (2006 – 2010) wat ondersoek is, te beskryf. Alhoewel Suid-Afrika met ‘n baie lae arbeidsmag produktiwiteitsvlak geag word in vergelyking met ander lande (Schwab, 2010 in World Competitive Report, 2010/2011), het die resultate getoon dat die algehele mediaan menskapitaalbeleggingsopbrengs ratio vir Suid-Afrikaans-gelyste maatskappye hoër (M = 3.03) was as die gepubliseerde syfers van die V.S.A., Europa en die Verenigde Koninkryk (PwC Saratoga, 2011). Hierdie beskrywende navorsing het ook die invloed van maatskappy-grootte (groot, medium of klein) en maatskappy-sektore (N = 42) op menskapitaaleffektiwiteit (soos geïndekseer deur die menskapitaal-beleggingsopbrengs) ondersoek. Geen statistiese beduidende verskille (p > .05) is tussen die menskapitaalbeleggingsopbrengs mediaan ratio’s oor die maatskappy-grootte kategorieë gevind nie, alhoewel daar noemenswaardige verskille in die mediaan van menskapitaalbeleggingsopbrengs oor die maatskappy-sektor kategorieë waargeneem is. Menskapitaalbeleggingsopbrengs het ook temporale skommelinge oor die studieperiode getoon, wat ekonomiese siklus-invloede reflekteer het, maar jaar-op-jaar veranderinge was groter indien die gemiddelde (mean) menskapitaalbeleggingsopbrengs gebruik was – mediaan menskapitaalbeleggingopbrengs het relatief stabiel van jaar-tot-jaar gebly. Uit hierdie navorsing word verskeie aanbevelings gemaak rakende die toepaslike gebruik van die menskapitaalbeleggingsopbrengs ykmerk-data. Die beskrywende studie lê ook ‘n vaste fondament vir toekomstige verklarende navorsing wat daarop gerig is om die voorafgaande veranderlikes (antecedents), korrelate en gevolge van menskapitaalbeleggingsopbrengs as ‘n indikator van menskapitaaleffektiwiteit te ondersoek. Die huidige studie dra tot die menskapitaalmaatstawweliteratuur by deur te demonstreer hoe menskapitaaleffektiwiteit indikatore vanaf geouditeerde finansiële resultate kan bereken word wat op die openbare domein beskikbaar is. Daardeur word gepoog om groter gebruik van menskapitaalrapportering in finansiële verslagdoeningstandaarde aan te moedig.af_ZA
dc.format.extent216 p. : ill.
dc.identifier.urihttp://hdl.handle.net/10019.1/20047
dc.language.isoen_ZAen_ZA
dc.publisherStellenbosch : Stellenbosch Universityen_ZA
dc.rights.holderStellenbosch University
dc.subjectHuman capital -- South Affricaen_ZA
dc.subjectJSE companiesen_ZA
dc.subjectDissertations -- Industrial psychologyen_ZA
dc.subjectTheses -- Industrial psychologyen_ZA
dc.subjectHuman capital effectiveness measures -- South Africaen_ZA
dc.subjectBenchmarking -- South Africaen_ZA
dc.subjectRate of return
dc.subjectHuman capital -- Cost effectiveness -- South Africaen_ZA
dc.subjectStock companies -- South Africaen_ZA
dc.subject.otherIndustrial Psychologyen_ZA
dc.titleHuman Capital Return-on-Investment (HCROI) in South African companies listed on the Johannesburg Stock Exchange (JSE)en_ZA
dc.typeThesis
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