Conclusion
This paper explored the current literature on human capital and its impact on firm performance. The conceptualization of human capitals is closely linked to some fundamentals of economics and firm performance. The literature reviews show that there are reasonably strong evidences to show that the infusion of ‘human capital enhancement’ in organizations promotes innovativeness and greater firm performance. Studies also clearly substantiate the fact that financial performance is positively impacted through the consideration of human capitals.
In light of this, the understanding of firm performance in relation to human capitals should not be regarded as a phenomenon that only adds ‘more zeros’ in a firm’s profits; it is rather transforming the entire workforce as the most ‘valuable assets’ in order for the organization to pave ways for greater achievements via innovativeness and creativity. Hence, companies should therefore, come up with some effective plans especially in investing the various aspects of human capital as not only does it direct firms to attain greater performance but also it ensures firms to remain competitive for their long term survival.