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Introduction The organisations can no longer try and convince themselves that change is an option It is inevitable and to survive organisations must accept it and move forward On that note there is a definite shift in priorities and values in the corporate world There is a growing interest in people as the corporate asset is part of this shift in values Human Capital Theory Human Capital is the most valuable asset an organisation can hold today It is seen increasingly as a key determinant of economic performance Fitzsimons 1999 Human capital is defined as the attributes of a person who are adding value to the organisation by being productive in some economic context which can either make an organisation fly or fall Purcell Ahlstrand 1994 These collective sums of attributes include life experience knowledge inventiveness energy and enthusiasm that people choose to invest in their work Beardwell Holden 1997 Gary Becker in his book Human Capital defines human capital theory as activities that increase future consumption possibilities by increasing the resources in people Sorensen 2000 The central argument of the human capital theory is that training is regarded as an investment in human capital where the expectation of a higher future productivity level becomes the reason for undertaking training Sorensen 2004 Human capital can be categorised into two basic forms ie general and specific Spencer 2004 The investment aspect is essential in the human capital theory The acquisition of human capital through training and education is an investment in the sense that the individual foregoes current income for increased potential earnings in the future Pfeffer 1998 Investment in specific human capital will increase an employees productivity but only at the work place where the employee is attached to Investment in general human capital on the other hand increases an employees productivity at other work places than the work place the employee is connected with at the time of investment
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