Management, Valuation, and Risk for Human Capital and Human Assets

Transcription

1 Management, Valuation, and Risk for Human Capital and Human Assets

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3 Management, Valuation, and Risk for Human Capital and Human Assets Building the Foundation for a Multi-Disciplinary, Multi-Level Theory Edited by Meir Russ

4 management, valuation, and risk for human capital and human assets Copyright Meir Russ, Softcover reprint of the hardcover 1st edition 2014 ISBN All rights reserved. First published in 2014 by PALGRAVE MACMILLAN in the United States a division of St. Martin s Press LLC, 175 Fifth Avenue, New York, NY Where this book is distributed in the UK, Europe and the rest of the World, this is by Palgrave Macmillan, a division of Macmillan Publishers Limited, registered in England, company number , of Houndmills, Basingstoke, Hampshire RG21 6XS. Palgrave Macmillan is the global academic imprint of the above companies and has companies and representatives throughout the world. Palgrave and Macmillan are registered trademarks in the United States, the United Kingdom, Europe and other countries. ISBN ISBN (ebook) DOI / Library of Congress Cataloging-in-Publication Data Management, valuation, and risk for human capital and human assets : building the foundation for a multi-disciplinary, multi-level theory / Meir Russ, Ph. D., editor. pages cm Includes bibliographical references and index. ISBN (hardcover : alk. paper) 1. Human capital Management. 2. Knowledge management. 3. Organizational change. I. Russ, Meir, 1968 editor of compilation. HD P dc A catalogue record of the book is available from the British Library. Design by Integra Software Services First edition: October

5 This book is dedicated to my children Ira, Yaara, Maytal, Yifat, their spouses, and their children, who have added so much joy and happiness to my life.

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7 Contents List of Figures and Tables Acknowledgments ix xiii Introduction What Kind of an Asset Is Human Capital, How Should It Be Measured, and in What Markets? 1 Meir Russ Part I Management 1 Team Composition and Project-Based Organizations: New Perspectives for Human Resource Management 37 Francesca Vicentini and Paolo Boccardelli 2 The Effect of Virtual Work Environments and Social Systems on Human Capital and Assets 59 Eugene A. Pierce and Sean W. Hansen 3 Perspectives on Human Capital Initiatives 91 Alyssa Danielson Part II Valuation and Risk 4 Models of Human Capital Valuation: A Review with Examples 113 Franko Milost 5 Investments in Human Capital: Elements of Investments, Their Valuation, a True and Fair View of Financial Statements Compiled by Using the Classical Approach, and the Related Financial Performance Ratios 137 Franko Milost 6 Intellectual Capital Efficiency and Corporate Performance: Some Empirical Evidence 161 Domenico Celenza, Marco Lacchini, and Fabrizio Rossi

8 viii Contents 7 An Assessment of the Accounting Perspective on Intellectual Capital and Some Results from the European Union 189 Michele Di Marcantonio and Marco Mattei 8 Human Capital Assessment: A Labor Accounting or a Management Control Perspective? 221 Paola Demartini and Paola Paoloni Index 239

9 Figures and Tables Figures I.1 Human capital taxonomy 4 I.2 Labor markets 6 I.3 The four-dimensional framework for human capital 11 I.4 Human capital: Major issues 14 I.5 Human capital paradigms Theoretical framework Distributed team logical structure Unit of analysis Trust: High-performing vs. lower-performing virtual teams Social relationship variables: Successful vs. less successful projects Project management variables: Successful vs. less successful projects Common factors: Less successful vs. successful projects Proposed conceptual model Human capital theory process flow Resource-based view theory process flow Transaction cost economics theory HR initiative selection analysis The dynamic model for valuating individual employees Company s opening balance sheet Company s balance sheet after purchasing equipment Company s balance sheet after making investments in employees Company s closing balance sheet System of integrated financial ratios related to investments in employees Conservative accounting approach New approach to market value Theoretical framework 170

10 x List of Figures and Tables 8.1 Case study: Defence Ltd. Visualizing IC Case study: Energy Ltd. Visualizing IC 231 Tables 1.1 Correlations and descriptive statistics at the individual level Results of the first-stage model: Individual level Correlations and descriptive statistics at the project team level Results of the second-stage model: Project team level Summary of interview participants Final coding structure Management processes and distributed team trust Dual-perspective differentiation of human capital HR management perspective examples of multilevel activities involving human capital as an asset The data needed for calculation of employee value The data needed for calculation of primary employee value Depreciation plan compiled by using classical accounting approach Depreciation plan compiled by using human resource accounting approach Income statement compiled by both classical accounting and human resource accounting Assets side of a balance sheet The results of the studies relating to various countries in the world Descriptive statistics for the selected variables The results of the hypotheses tested Structure of the selected Sample The VAIC models Descriptive statistics of the variables included in the VAIC models shown in Table Pearson correlation coefficients for the main Sample OLS regressions (models 1, 2, 3 and 4) for the main Sample OLS regressions (models 1, 2, 3 and 4) for subsamples Non-Services and Services Multivariate OLS regressions (models 5, 6, 7, and 8) for the main Sample 207

11 List of Figures and Tables xi 7.8 Multivariate OLS regressions (models 5, 6, 7, and 8) for subsamples Non-Services and Services Descriptive statistics of the variables included in the OLS regression model of Equation Pearson correlation coefficients for the main Sample OLS regressions of the model reported in Equation 7.6 for the main Sample, for subsample Non-Services and for subsample Services Human capital measurement according to labor accounting literature Human capital measurement according to intellectual capital literature Case study: Defence Ltd. Management challenges and performance indicators Case study: Energy Ltd. Management challenges and performance indicators 234

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13 Acknowledgments A call for chapters challenged potential authors to consider a unifying, multilevel theory of human capital arriving from different academic traditions and perspectives. The authors were invited to contribute to the book based on approved proposals. Each complete chapter received external, blind review in addition to the editor review. The author thanks Kelly Anklam for her assistance in editing this introduction and also wishes to that the Frederick E. Baer Professorship in Business and the Philip J. and Elizabeth Hendrickson Professor in Business at UW-Green Bay for partial financial support. The author also thanks Leif Edvinsson for his comments on the earlier version of this chapter. Finally, the author hopes that the discussion of creating a unifying, multilevel theory of human capital will continue based on the chapters presented in this volume.