The relationship between Human Capital Performance and Corporate Financial Performance

“Participating in the DBA program at MSM gave me a unique opportunity to improve my research skills, analytical skills and practical knowledge in my field of study which lead to real added value to my career”.

That is what Ms. Shohreh Parham said after successfully defending her thesis titled: The Relationship between Human Capital Efficiency and Corporate Financial Performance of Production and Manufacturing Companies. Cases of Production and Manufacturing Companies in the Netherlands at MSM on 20 October 2016.

dba-defense-ms-parham-2 Her study aimed at investigating the efficiency of Human Capital and its impact on the financial performance of Dutch production companies. Using data from 33 Dutch production companies for a period of 6 years (2007-2012) the monetary value created by their employees was measured. The initial findings revealed that there is positive relationship between Human Capital Efficiency and corporate performance measures including profitability and productivity.

To explore the factors that affect the efficiency of human capital, Ms. Parham approached both high performance and low performance companies with the request of participating in an in-depth interview. The result of the qualitative research showed that several policies are applied by high performance companies including: BPO strategy, effective recruitment policy, organizing training programs based on competency gaps, developing key performance indicators, HSSE strategy and performance based reward system. The mentioned policies are believed to be the main causes of higher human capital efficiency and consequently better financial performance in these companies.

The pictures of the defense can be found here.