Role of Human Capital and Knowledge Management Practices in Organizational Growth: The case of Saudi Arabia

Abstract

In the competitive world, organizations have realized that without effective implementation of knowledge management practices and human capital utilization, gaining competitive edge is a daydream. Unfortunately, limited studies have focused on exploring the role of knowledge management practices and human capital on improving organizational performance which has created ambiguity among policy makers and professionals. Therefore, purpose of this study is explaining the role of KM practices and human capital in enhancing organizational performance. Data was collected from 181 supervisors and managers working in various organizations operating at global level and analyzed using structural equation modelling with Amos 16. Findings of this study indicated that human capital dimensions namely leadership and motivation, satisfaction and creativity mediate the relationship between KM practices and firm performance in terms of global agility and global innovations. Whereas qualification as dimension of human capital has no significant effects on firm performance. Findings of this study will be helpful for policy makers and management professionals to design and implement their policies accordingly. Since none of the study has examined relationship among these variables, this study will provide better understanding about the role of KM practices and human capital in improving organizational performance.