Human capital is a powerful concept

Human capital is a powerful concept to those interested in strategic human resource management because it blends traditional aspects of personnel management with economic principles of capital accumulation, investment, deployment and value creation that underlie much of strategic management. The first rule of organizations is that people do not work alone; they combine their talents and energies to accomplish their goals. A related idea popular these days among sociologists, economists, anthropologists and organizations, called social capital, may be helpful. Social capital is defined as the actual and potential resources embedded within, available through, and derived from the network of relationships possessed by an individual or social unit. The latest research on social capital is reviewed, and its implication for HR managers is discussed.