IDEAS home Printed from https://ideas.repec.org/a/vrs/manmar/v15y2020i2p326-344n11.html
   My bibliography  Save this article

Achieving innovative firm performance through human capital and the effect of social capital

Author

Listed:
  • Samad Sarminah

    (Princess Nourah Bint Abdulrahman University Riyadh, Saudi Arabia, College of Business Management)

Abstract

For the past decade, human capital has been recognized as one of the crucial assets of any firm’s overall performance. Previous studies widely advocated a linear link between human capital and innovative firm performance, arguing that there are a variety of factors to examine if the relationship between human capital and innovative firm performance is to be properly understood. The focus of this study was to examine the effect of social capital on the relationship between human capital and innovative firm performance. Specifically, it examined the relationship between human capital and social capital and between human capital and innovative firm performance. It also examined the relationship between social capital and innovative firm performance. A total of 294 questionnaires were obtained from managerial staff in automotive companies in Malaysia and the data was analysed using the Partial Least Squares (PLS) test. The results indicated a direct effect between human capital and innovative performance. It was found that human capital is significantly related to social capital and that there is a significant relationship between social capital and innovative firm performance, indicating the ability of social capital to improve innovative firm performance. Finally, it revealed that innovative firm performance could be achieved by human capital through the role of valuable social capital and that good innovative firm performance leads to more prudent and sustainable organisations. The results provide pertinent implications for academia, policymakers and market players while also contributing to the research fields of strategic management, human capital, social capital and performance.

Suggested Citation

  • Samad Sarminah, 2020. "Achieving innovative firm performance through human capital and the effect of social capital," Management & Marketing, Sciendo, vol. 15(2), pages 326-344, June.
    • Handle: RePEc:vrs:manmar:v:15:y:2020:i:2:p:326-344:n:11
    DOI: 10.2478/mmcks-2020-0019
    as

    Download full text from publisher

    File URL: https://doi.org/10.2478/mmcks-2020-0019
    Download Restriction: no
    File URL: https://libkey.io/10.2478/mmcks-2020-0019?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Sascha O. Becker & Ludger Woessmann, 2009. "Was Weber Wrong? A Human Capital Theory of Protestant Economic History," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 124(2), pages 531-596.
    2. Fleisher, Belton & Li, Haizheng & Zhao, Min Qiang, 2010. "Human capital, economic growth, and regional inequality in China," Journal of Development Economics, Elsevier, vol. 92(2), pages 215-231, July.
    3. Se-Yeon Ahn & So-Hyung Kim, 2017. "What Makes Firms Innovative? The Role of Social Capital in Corporate Innovation," Sustainability, MDPI, vol. 9(9), pages 1-13, September.
    4. Raja Roy & MB Sarkar, 2016. "Knowledge, firm boundaries, and innovation: Mitigating the incumbent's curse during radical technological change," Strategic Management Journal, Wiley Blackwell, vol. 37(5), pages 835-854, May.
    5. Kaish, Stanley & Gilad, Benjamin, 1991. "Characteristics of opportunities search of entrepreneurs versus executives: Sources, interests, general alertness," Journal of Business Venturing, Elsevier, vol. 6(1), pages 45-61, January.
    6. Jacob A. Mincer, 1974. "Introduction to "Schooling, Experience, and Earnings"," NBER Chapters, in: Schooling, Experience, and Earnings, pages 1-4, National Bureau of Economic Research, Inc.
    7. Subramony, Mahesh & Segers, Jesse & Chadwick, Clint & Shyamsunder, Aarti, 2018. "Leadership development practice bundles and organizational performance: The mediating role of human capital and social capital," Journal of Business Research, Elsevier, vol. 83(C), pages 120-129.
    8. Yang, Dennis Tao & An, Mark Yuying, 2002. "Human capital, entrepreneurship, and farm household earnings," Journal of Development Economics, Elsevier, vol. 68(1), pages 65-88, June.
    9. Edward L. Glaeser & David Laibson & Bruce Sacerdote, 2002. "An Economic Approach to Social Capital," Economic Journal, Royal Economic Society, vol. 112(483), pages 437-458, November.
    10. Estrin, Saul & Mickiewicz, Tomasz & Stephan, Ute, 2016. "Human capital in social and commercial entrepreneurship," Journal of Business Venturing, Elsevier, vol. 31(4), pages 449-467.
    11. Niels Noorderhaven & Anne-Wil Harzing, 2009. "Knowledge-sharing and social interaction within MNEs," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 40(5), pages 719-741, June.
    12. Davidsson, Per & Honig, Benson, 2003. "The role of social and human capital among nascent entrepreneurs," Journal of Business Venturing, Elsevier, vol. 18(3), pages 301-331, May.
    13. Jacob A. Mincer, 1974. "Schooling, Experience, and Earnings," NBER Books, National Bureau of Economic Research, Inc, number minc74-1.
    14. Per Davidsson & Johan Wiklund, 2001. "Levels of Analysis in Entrepreneurship Research: Current Research Practice and Suggestions for the Future," Entrepreneurship Theory and Practice, , vol. 25(4), pages 81-100, July.
    15. Mie Augier & David J. Teece, 2009. "Dynamic Capabilities and the Role of Managers in Business Strategy and Economic Performance," Organization Science, INFORMS, vol. 20(2), pages 410-421, April.
    16. Chris Rowley & Gordon Redding, 2012. "Building human and social capital in Pacific Asia," Asia Pacific Business Review, Taylor & Francis Journals, vol. 18(3), pages 295-301, July.
    17. Watson, Warren & Stewart, Wayne Jr. & BarNir, Anat, 2003. "The effects of human capital, organizational demography, and interpersonal processes on venture partner perceptions of firm profit and growth," Journal of Business Venturing, Elsevier, vol. 18(2), pages 145-164, March.
    18. Unger, Jens M. & Rauch, Andreas & Frese, Michael & Rosenbusch, Nina, 2011. "Human capital and entrepreneurial success: A meta-analytical review," Journal of Business Venturing, Elsevier, vol. 26(3), pages 341-358, May.
    19. Robert J. Bennett & Paul J. A. Robson, 1999. "The use of external business advice by SMEs in Britain," Entrepreneurship & Regional Development, Taylor & Francis Journals, vol. 11(2), pages 155-180, April.
    20. Gary S. Becker, 1964. "Human Capital: A Theoretical and Empirical Analysis with Special Reference to Education, First Edition," NBER Books, National Bureau of Economic Research, Inc, number beck-5.
    21. Colombo, Massimo G. & Grilli, Luca, 2005. "Founders' human capital and the growth of new technology-based firms: A competence-based view," Research Policy, Elsevier, vol. 34(6), pages 795-816, August.
    22. Cho, Sam Yul & Arthurs, Jonathan D., 2018. "The influence of alliance experience on acquisition premiums and post-acquisition performance," Journal of Business Research, Elsevier, vol. 88(C), pages 1-10.
    23. Ashish Arora & Michelle Gittelman & Sarah Kaplan & John Lynch & Will Mitchell & Nicolaj Siggelkow & Chunmian Ge & Ke-Wei Huang & Ivan P. L. Png, 2016. "Engineer/scientist careers: Patents, online profiles, and misclassification bias," Strategic Management Journal, Wiley Blackwell, vol. 37(1), pages 232-253, January.
    24. Jacob A. Mincer, 1974. "Schooling and Earnings," NBER Chapters, in: Schooling, Experience, and Earnings, pages 41-63, National Bureau of Economic Research, Inc.
    25. Tanţău Adrian & Gavrilescu Ileana, 2019. "Key anxiety factors for buying an electric vehicle," Management & Marketing, Sciendo, vol. 14(2), pages 240-248, June.
    26. Julie M. Hite, 2005. "Evolutionary Processes and Paths of Relationally Embedded Network Ties in Emerging Entrepreneurial Firms," Entrepreneurship Theory and Practice, , vol. 29(1), pages 113-144, January.
    27. Peter Wad & V.G.R. Chandran Govindaraju, 2011. "Automotive industry in Malaysia: an assessment of its development," International Journal of Automotive Technology and Management, Inderscience Enterprises Ltd, vol. 11(2), pages 152-171.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ekaterina V. Orlova, 2021. "Design of Personal Trajectories for Employees’ Professional Development in the Knowledge Society under Industry 5.0," Social Sciences, MDPI, vol. 10(11), pages 1-29, November.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. J. Augusto Felicio & Eduardo Couto & Jorge Caiado, 2013. "Human capital, social capital and organizational performance: A structural modeling approach," CEMAPRE Working Papers 1302, Centre for Applied Mathematics and Economics (CEMAPRE), School of Economics and Management (ISEG), Technical University of Lisbon.
    2. Klyver, Kim & Steffens, Paul & Lomberg, Carina, 2020. "Having your cake and eating it too? A two-stage model of the impact of employment and parallel job search on hybrid nascent entrepreneurship," Journal of Business Venturing, Elsevier, vol. 35(5).
    3. Parker, Simon C., 2013. "Do serial entrepreneurs run successively better-performing businesses?," Journal of Business Venturing, Elsevier, vol. 28(5), pages 652-666.
    4. Ralph Hippe & Roger Fouquet, 2024. "The Human Capital Transition and the Role of Policy," Springer Books, in: Claude Diebolt & Michael Haupert (ed.), Handbook of Cliometrics, edition 3, pages 411-457, Springer.
    5. Andreas Rauch & Serge A. Rijsdijk, 2013. "The Effects of General and Specific Human Capital on Long–Term Growth and Failure of Newly Founded Businesses," Entrepreneurship Theory and Practice, , vol. 37(4), pages 923-941, July.
    6. Anisur R. Faroque & Farhad Uddin Ahmed & Mahabubur Rahman & Mohammad Osman Gani & Sina Mortazavi, 2023. "Exploring the individual and joint effects of founders' and managers' experiential knowledge on international opportunity identification," Asian Business & Management, Palgrave Macmillan, vol. 22(4), pages 1274-1300, September.
    7. Zhang, Ye & Johan, Sofia & Fu, Kun & Hughes, Mathew & Scholes, Louise & Liu, Jiajia, 2024. "The effect of lead investor’s human capital on funding performance: The moderating role of investment ambition," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 90(C).
    8. Bo-Xiang Hsu & Yi-Min Chen, 2021. "Why university matters: the impact of university resources on foreign workers’ human and social capital accumulation," International Entrepreneurship and Management Journal, Springer, vol. 17(1), pages 45-61, March.
    9. Aidis, Ruta & van Praag, Mirjam, 2007. "Illegal entrepreneurship experience: Does it make a difference for business performance and motivation?," Journal of Business Venturing, Elsevier, vol. 22(2), pages 283-310, March.
    10. Tomas Karlsson & Caroline Wigren, 2012. "Start-ups among university employees: the influence of legitimacy, human capital and social capital," The Journal of Technology Transfer, Springer, vol. 37(3), pages 297-312, June.
    11. Joaquin Turmo-Garuz & M.-Teresa Bartual-Figueras & Francisco-Javier Sierra-Martinez, 2019. "Factors Associated with Overeducation Among Recent Graduates During Labour Market Integration: The Case of Catalonia (Spain)," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 144(3), pages 1273-1301, August.
    12. Pritha Dev & Blessing U. Mberu & Roland Pongou, 2016. "Ethnic Inequality: Theory and Evidence from Formal Education in Nigeria," Economic Development and Cultural Change, University of Chicago Press, vol. 64(4), pages 603-660.
    13. Zhang, Xiaobei & Wang, Xiaojun, 2021. "Measures of human capital and the mechanics of economic growth," China Economic Review, Elsevier, vol. 68(C).
    14. Erik Lundmark & Anna Krzeminska & Dean A. Shepherd, 2019. "Images of Entrepreneurship: Exploring Root Metaphors and Expanding Upon Them," Entrepreneurship Theory and Practice, , vol. 43(1), pages 138-170, January.
    15. Daniele Checchi, 2001. "Education, Inequality and Income Inequality," STICERD - Distributional Analysis Research Programme Papers 52, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.
    16. Mayer-Haug, Katrin & Read, Stuart & Brinckmann, Jan & Dew, Nicholas & Grichnik, Dietmar, 2013. "Entrepreneurial talent and venture performance: A meta-analytic investigation of SMEs," Research Policy, Elsevier, vol. 42(6), pages 1251-1273.
    17. Hans‐Peter Y. Qvist & Anders Holm & Martin D. Munk, 2021. "Demand and Supply Effects and Returns to College Education: Evidence from a Natural Experiment with Engineers in Denmark," Scandinavian Journal of Economics, Wiley Blackwell, vol. 123(2), pages 676-704, April.
    18. Christiansen, Charlotte & Joensen, Juanna Schroter & Nielsen, Helena Skyt, 2007. "The risk-return trade-off in human capital investment," Labour Economics, Elsevier, vol. 14(6), pages 971-986, December.
    19. Souksavanh VIXATHEP & Nobuaki MATSUNAGA, 2015. "Entrepreneurial Human and Social Capital in Small Businesses in Vietnam - An Extended Analysis -," GSICS Working Paper Series 29, Graduate School of International Cooperation Studies, Kobe University.
    20. Wyrwich, Michael, 2013. "Can socioeconomic heritage produce a lost generation with regard to entrepreneurship?," Journal of Business Venturing, Elsevier, vol. 28(5), pages 667-682.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:vrs:manmar:v:15:y:2020:i:2:p:326-344:n:11. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Peter Golla (email available below). General contact details of provider: https://www.sciendo.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.