CHAPTER ONE

INTRODUCTION “You can get capital and erect building, but it takes people to

build a business"

Thomas J. Watson

Founder, IBM.

1.1 Background of the studyWe cannot overemphasize the need for qualified, competent

and experienced work force in the development process of any

nation or organisation. The quality of the labour force and

accelerated pace of development taking place in development

economies have accentuated the need for seasoned managers

to pilot development efforts.

The event in Nigeria in the past decade where manufacturing

subsector had been characterized by low capacity utilization

(which average 30 percent to be modest), low and negative

growth rate, and high import content/dependence for

technologies and inputs partly due to lack of proper strategic

planning, call for properly groomed, seasoned and experienced

managers to formulate and promote good corporate

governance. Most of the problems confronting the Nigerian

nation are traceable to poor management.

Management holds the key that unlocks the forces of economic

and social development in any modern economy. It is therefore

a must for managers and infact, the total workforce to learn

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basic principles, skills and techniques including organisation

behaviour and appreciate the difficulties encountered by key

management in guiding and directing the organisation as an

integrated unit.

This invites an attempt to juxtaposition the essence of

management in human capital development.

Human Capital Development consists of the knowledge, skills

and abilities of the people employed in an organisation or in a

nation (Armstrong M. 2005).

The human capital development in the words of Bontis'et al

(1999) is defined as "the human factor” in the organisation; the

combined intelligence, skills and expertise that gives the

organisation its distinctive character. The human elements of

the organisation are those that are capable of learning,

changing, innovating and providing the creative thrust which if

properly motivated can ensure the long-term survival of the

organisation.

Human capital is the most important element in an

organizations intellectual capitals and it consists of the stocks

and flows of knowledge available to an organisation.

It is the knowledge, skills and abilities of individuals that create

value, which is why the focus has to be on means of attracting,

retaining, developing and maintaining the human capital they

represent.

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As commented aptly by Davenport (1999) that "people possess

innate abilities, behaviours and personal energy and these

elements make up the human capital they bring to their work”.

It is in this perspective of enhancing the value and relevance of

the human capital on a continuous basis that the impact and

eventual contribution of management consulting, and in fact

training and performance consulting is appreciated and

evaluated. Enhancing the value, updating the related

management knowledge and development of attitudes, values,

skills, competencies and techniques are the critical issue in

developing and sustaining human capital development viz-a-viz

intellectual capital of a nation. The agents of the change are

leadership, entrepreneurship education, training and manpower

development in a strategic focus.

1.2 STATEMENT OF THE PROBLEM OF THE STUDY.Terry Kendall Consult Ltd is one of the management

consulting firms in Nigeria with a commitment to provide and

encourage the acquisition of skills in industry and commerce

with a view to generating a pool of indigenous manpower

sufficient to meet the needs of the nations. Terry Kendall

Consult Ltd (Terry Kendall in short) employees are 15 with a

branch outside Lagos. The employees are made of both

managers and non-managers.

3

The issue is how does Terry Kendall contribute to the

development of human capital development in Nigeria by way

of training and manpower development.

1.3 THE OBJECTIVES OF THE STUDY:The following objectives are defined for the study:

1. To define the role of management consultant

2. To appreciate and understand what human capital development

is all about

3. To examine the role of Terry Kendall Consult Ltd in meeting the

challenges of improving or enhancing the value, stock and

relevance of human capital development in prompting

economic growth and development of the nation and

4. Finally, to examine various factors impeding and enhancing the

role of management consulting in assuming the indisputable

agent or catalyst of change in economic growth and national

transformation.

5. SCOPE AND LIMITATION OF THE STUDYThe study is only about Terry Kendall Consult Ltd consulting

and training role in an attempt to improve the stock and flows of

human capital development of the nation. This means that no

other aspect of the company is studied. The study therefore

qualifies for the tripod (Kaplan, 1964: 78) or triangular principles

of scientific research (Bringbeng and Nachimal's 1986 : 161)

4

The triangle represents what Nachimal's and Nachimal's (1974 :

56) call unit of analysis or locus of problem (Kaplan 1964 : 78)

The figure below demonstrates the scope of this study.

A

Training

Discussion Performance

Consulting

B C

Lagos metropolis

SPACIAL DIMENSION (TERRY

KENDALL

GROUP).

Figure 1: Triangular - Scope of the study

The triangular ABC fixes the subject of the research

(consulting) in relation with its spatial (Lagos Metropolis) study

population.

The limitations of the study are that the study is situated in only

one organisation. The implication is that the result will only be

applicable or generallable to Terry Kendall group.

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1.4 SIGNIFICANCE OF THE STUDYThe results of this study will reveal the impact, though

insignificant, Terry Kendall group is making towards

management education and training/consulting, management

awareness and consciousness.

The study will demonstrate the role of consulting in human

capital development and the vision of the company to positively

impact on the stocks and flows of human capital development

in partnership with other management consulting firms in

Nigeria and all over the world since the global world has

exposed every transaction no matter how localized, to every

body in every climate, apart from the ever increasing

competitiveness.

1.5 DEFINITION OF TERMS ROLEWhen faced with any situation, e.g carrying out a job, people

have to enact a role in order to manage that situation. The

person must act within situations: situations are rule - governed

and how a person behaves often prescribed by these socially

acquired roles.

Thus the person adopts a suitable role in order to perform

effectively within the situation.

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HUMAN CAPITALIt consists of the knowledge, skills and abilities of the people

employed in an organisation.

INTELLECTUAL CAPITALIt consists of the stocks and flows of knowledge available to an

organisation. These can be regarded as intangible resources

which, together with tangible resources (money and physical

assets), comprise the market or total value of a business.

KNOWLEDGE MANAGEMENTThe purpose of knowledge management is to capture a

company's collective expertise and distribute the biggest payoff"

Knowledge management is about getting knowledge from those

who have it to those who need it in order to improve

organizational effectiveness.

Knowledge management is "any process or practice of creating,

acquiring, capturing, sharing and using knowledge, wherever it

resides, to enhance learning and performance in organizations.

Knowledge management involves transforming knowledge

resources by identifying relevant information and then

disseminating it so that learning can take place.

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MANAGEMENT CONSULTANT.Management consultant is a person or a group of people with

relevant management skills, attitudes, competencies,

techniques and what have you, purposed to proffer

management solutions to organizational problems and /or

challenges.

It is a professionally trained expert in specific area of

management or vocation.

TRAININGThis is a process or procedure through which the skills, talent

and knowledge of an employee is enhanced or increased.

DEVELOPMENTThis is concerned with preparing the employee so that they can

move with the organisation as it develops, changes and grows.

EDUCATIONEducation encompasses all the process and activities designed

to improve the overall competence of an employee in a

specified direction and beyond the job currently held.

It entails preparing people for life.

LEARNING This is any relatively permanent change in behaviour as a result

of observation and experience

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ORGANISATIONAL DEVELOPMENT This is a deliberate, holistic and planned intervention, inputs or

stepping into remove obstacles and bottlenecks coming in the

way of the effective running of an organisation with more

emphasis on the people and their tools, processes and system

and sub-systems of work for the achievement of organisation

effectiveness.

CAREER DEVELOPMENTThis entails the development of the career of an individual

employee along a clearly defined career path by harnessing his

plan into the corporate plan

CAREERThis is a sequence of separate, but related work activities that

provide continuity, order and meaning in some ones work life.

It is a profession in which a person specializes in a permanent

employment as well as the sequence of work related position

occupied throughout a person's life.

CAREER PATHThis is the modus of achieving a career through a successive

patterned progression.

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TRAINING EFFECTIVENESSThe ability of employee training and development to achieve

defined objectives.

EMPLOYEE ATTITUDEThe disposition of employee to accept or reject training and

development

MANAGEMENT ATTITUDEThe disposition of management to approve or disapprove

training and development

SUCCESSSION PLANNINGThis has to do with the process of grooming the necessary

manpower to fill those positions from which the incumbent will

retire within a foreseeable future or for position where the

incumbent resigns, dies or is terminated.

PERFORMANCE CONSULTANTWhere the purpose and focus of the role is to partner with

management to identify and achieve performance excellence.

HUMAN RESOURCES MANAGEMENT (HRM)It is a strategic and coherent approach to the management of

an organization’s most valued assets: the people working there

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who individually and collectively contribute to the achievement

of its objectives.

HRM GOALSIt helps the organisation to achieve success through people.

It is concerned with both meeting human capital requirements

and the development of process capabilities in other words, the

ability to get things done effectively.

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1.6 REFERENCES

Michael Armstrong (1977), Human Resources Management

Practice. 9th Edition London and Sterling, VA.New Delhc

Kogan Page Limited,

Dana Gaines Robinson & James C. Robinson (1905),

Performance Consulting: Moving Beyond Training. San

Francisio CA. Berret Koehler Publishers, Inc.

Obisi C (2003) Organisational Behaviour - Concepts and

Applications. Lagos Malt House Press Limited

Obisi C (1996) Personnel Management, Ibadan, Jackbod

Enterprises.

Nwachukwu C.C. Management Theory and Practice, Onitsha

Africana FEP Publisher Ltd

Luthans Fred and Hodgetts m (1992) Business New york The Dryden Press.

12

CHAPTER TWO

2. BRIEF HISTORICAL BACKGROUND AND OBJECTIVES OF TERRY KENDALL CONSULT LTD - (THE TERRY KENDALL GROUP).

In an increasingly knowledge based economy, information is

becoming at least as important as land and physical capital.

If African countries cannot take advantage of the information

revolution and sure this great divide and experience

technological change, they may be crushed by it"

- The World Bank

"The scarcity of human resources is not one of numbers, for our

population has been increasing.

It is rather a scarcity of trained people with adequate

experience in doing difficult tasks willing and able to undertake

the responsibilities that follow from greater innovation and

greater complexity in business enterprises.

- Daiton McFarland

2.1. BACKGROUND :TERRY KENDALL Consult Limited was incorporated on

December 16, 1987 with the aim of providing and encouraging

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the acquisition of skills in industry and commerce with a view to

generating a pool of indigenous manpower sufficient to meet

the needs of the nations.

The following are the key areas of concentration by Terry

Kendall Group.

- involved in organizing courses and seminars, training and

retraining of staff to meet new challenges

- focusing on appropriate management solution for

developmental and business problems in emerging

nations with particular emphasis on the Nigerian business

environment

- combining practical experience with an understanding of

global business realities and sensitivity to cultural

differences, and

- emphasizing recruitment, training, performance

consulting, skills, competencies as well as technology.

TERRY KENDALL has three main subsidiaries:

1. Ralph Maxwell Consulting (RMC) Is involved in Human

Resources Consulting, Training, Recruitments, Labour

Relations, Performance Consulting and Management

Consulting.

2. TERRY KENDALL Leadership Academy (TKLA).It organizes short-term and day release and weekend

programmes in Leadership and Entrepreneurship Development.

It also runs and conducts examinations on foundation and

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professional certificates on Leadership and Entrepreneurship

Development.

3. The 21st Century Effective Manager.

It is published on quarterly basis and focuses on management

development. It also publishes books on Economics,

Management, International Relations etc and Revision packs

for undergraduate and postgraduate/professional students in all

fields of social and management sciences.

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CHAPTER THREE

3. THE ROLE OF MANAGEMENT CONSULTANT IN HUMAN CAPITAL DEVELOPMENT OF THE NATION

Most managers have discovered that productive work cannot

be achieved through command, order to executive fiat.

Improved employee productivity depends on individual

motivation.

Brain Rapp. Public Management, May 1978.

3.1 The Management Consultant The task of planning an enterprise for profitability leads us to

one inescapable conclusion: that there is no enterprise that can

be so perfect that it will not have problems. Problems there will

be, and the majority of these will be created for the enterprise

by its operating environment such as changes in social,

economic and political strategies within the national economy.

There will be problems that will emanate from the activities of

other enterprises, whether they be competitors or

complementary organizations.

There will be problems, too, that will be imposed on the

enterprise by the conflicting goals of the various interest groups

within the enterprise itself. As a matter of fact, problems are the

germs that make an enterprise tick; they are the milestones by

which enterprises performance can be sensibly measured.

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The question therefore is not whether managers will run into

enterprise problems, but what managers will do with problems

when they arise, and what the owners of business or their

accredited representatives the Board of Directors will expect

managers to do when problems of extra-ordinary nature arise.

3.1.2 MANAGERS ARE BUSY PEOPLEBy the nature of their tasks, managers are very busy people.

Ask any manager how he spends his day and if he is

conscientious, he will tell you that he works between twelve and

sixteen hours per day. He is lucky if he contains his daily

routines within 80% of his working day. He spends the greater

part of his working day helping other people out of their

problems; he settles down to his own specific task after the

official closing hours. Even this achievement depends on

whether he is courageous enough to get rid of other peoples'

problems by the close of the working day. In Nigeria, for

instance, most people are tempted to believe that they will get

better attention from managers after the official closing hours,

and this is commonly believed to be the unwritten part of his job

specification.

3.1.3 MANAGERS NEED HELPIt could assume that managers working under such pressure as

we have described would:

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(a) Reaffirm their total commitment to planning for the

profitability of their enterprises.

(b) Solicit support where they find themselves soaked by

daily routines to the detriment of their first task as

managers planning.

(c) Deserve sympathy from the owners of business or their

representatives the Board of Directors where and when

the needs arise to give management a helping hand in

planning work.

Unfortunately, none of these assumptions holds true.

Managers either do not realize, or they are too conscious of

their performance rating, that they hesitate to call for help when

help is needed to sustain the planning aspects of their jobs.

Consequently, managers grapple with the routines and allow

their planning work to suffer. Enterprises run out of strategies

and managers get blamed for mismanagement.

In those instances where managers venture to propose an

invitation to external experts to help sort out strategic issues or

provide specialist planning data, tools and techniques, Boards

of Companies often get scared by consultancy fee however

meager this might be. As such, managers get gunned down by

Boards, and once beaten twice shy the managers become.

Managers deserve sympathy from owners of business or their

representatives. it is sheer rhetoric to express confidence, as

Boards often do, in the competence of management when

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rejecting management proposals for consultancy work. True

enough, managers are often recruited from the best of

materials available at the time, but it is equally true that no

organisation ever budgets for spare management personnel.

This is understandable because skilled managers are both

costly and scare to come by. Every managers experienced

enough to understand the intricacies of his enterprises will

already have been fully stretched to the extent that he may find

it tough to find a few minutes a day for strategic planning work.

The problem is therefore not one of managers being

incompetent but that of their not being allowed by the ordinary

pressures of the business and its environment to settle down to

the often complicated and time consuming planning routines

that are necessary for growth and survival of their

organizations.

3.1.4 CONSULTANTS TO THE RESCUESince the days of industrial revolution, there has been an

increasing use of management consultants. Henry Fayol (Time

and Motion Study) Abraham Maslow (Hierarchy of Needs in

Motivation) and Frederic Herzberg (Job Enrichment), to name a

few developed important management principles and

techniques borne out of practical experiences in enterprises.

They became both eager and willing to share their experience

so much so that they trained the people who later spread the

use of the methods and techniques so developed across the

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industrialized world. Since then, management consultants have

come to stay for very good reasons.

3.1.5 WHY ENTERPRISES ENGAGE CONSULTANTSSome of the good reasons for engaging the management

consultants are as follows:

1. A manager may wish to have an objective study of his

problem by an expert.

2. He may want refresh original thinking done on his

problem.

3. He may want to have a techniques or procedure installed,

a task which there is no spare person within the

organisation to major on.

4. He may want to develop the people in his organisation

through contact with outside viewpoint.

5. He may wish to augment his regular staff to handle a

temporary overload of work for which he may not wish

to add permanent employees.

It is clear therefore that every enterprises will, one time or other,

have cause to want to call in a management consultant, if only

on the basis that "a new broom sweeps cleaner". In a number

of situations, enterprises will find that some of their people are

more open to external consultants concerning their work

problems than they would have been to their own colleagues.

People tend to fear that their own colleagues will expose or

criticize them for incompetence thus undermining their self

respect.

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Like the judge sitting in the courts or the physician attending to

thousand of medical cases, the management consultant worth

his salt becomes exposed to a variety of business problems

through his wide range of contacts and working experiences.

This does not make him any better brain than the operating

managers, but through exposure he is often able to compare

and contrast business cases and the consequences on the

tools and techniques that were used in resolving those cases.

3.2 CHOICE OF CONSULTANTS

Certainly, all managers sometimes feel the urge to call in

outside help in resolving certain types of business problems.

They may be slow to act or will never act at all depending on

their state of knowledge as to where to call for help and which

particular consultant to call.

In the absence of a body representing management consulting

practitioners and regulating their activities, this problem is very

real. Some of the several firms and individuals engaged in

consulting activities are either unknown or are treated with

suspicion in terms of their integrity and professional

attainments. Many of the persons and firms posing as

management consultants are either drop outs from the field of

management or newly qualified persons with little or no

experience looking for quick monetary gains.

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These are the group that have done the greatest disservice to

the course of management consultancy. They are mainly

responsible for the volumes of reports that are often towed

away somewhere in the achieves gathering dust and never

used. They alone are responsible for systems that have

collapsed soon after the departure of the "consultants" who

introduced such system. They are the ones to dread.

Having said that, managers should be rest assured that among

the hundreds of management consultancy firms in modern

industrial and commercial centres, there are a few with the

requisite ability to handle the field of their claim. The one man

show consulting firms can be particularly dependable and worth

trying. They are usually people with a wealth of experience and

a sense of mission in their chosen field who earn their living by

their reputation for good job. They will usually prefer to start a

project and finish it themselves, and will act more as a catalyst

for the organizations engaging them, a posture which enables

them to carry the organization with them in the changes that are

introduced.

The institutional consultants on the other hand are a mixture of

'good and evil'. On the credit side they are always able to

deploy a mixed team of expert, an accountant, an economist, a

behavioral scientist, statistician and an engineer. Such a team

attacking a business problem is likely to come up with a

solution that satisfies the needs of most of the functional areas

of the enterprises.

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On the liability side, an institutional consulting firm may well

allow a highly qualified hand but one who has had little or no

real practice on line management to introduce solutions that

turn out to be good only in theory. In practice, however, this

disadvantage is usually kept under control through supervision

of the work done. Team leaders in well organized consulting

firms are usually people of extensive practice and experience,

who are able to control the output of the less experienced

members of their team.

However, consultants do not generally advertise their services.

In societies where there are associations of management

consultants, the problem of choice will be minimized through

contact with such associations either directly or through their

publications, reports and grading.

Where such associations do not exist, it may still be possible to

obtain useful information from the Business Registry, banks

and investment institutions.

Management consultants, the good ones, are management

partners. Where they are used, the cost of the work can be

returned to the user many fold.

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3.3 POSSIBLE AREAS OF CONSULTANCYEnterprises will find consultants readily useful in the following

areas:

1. UNION NEGOTIATIONS:There is no better judge than the man who is looked upon

as natural to a dispute. A management consultant will

fade out of business if he cannot prove himself as an

impartial judge. Most good consultants know this and

capable of winning the respect of management and

workers as a judge.

It pays to engage them on union negotiations.

2. MARKET INTELLIGENCE:The greatest asset a consultant has is his knowledge of

sources of facts.

3. PRODUCTIVITY IMPROVEMENT:Techniques are his stock in trade : Job evaluation, job

enrichment, work measurement, attitude control and incentive

schemes are some of the well known tools a trained and

experienced consultant will use in motivating people to greater

productivity. Workers become suspicious when the same tools

are used by internal management personnel in introducing work

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changes. Used by external consultants, the same tools often

meet with acceptance.

4. STOCK CONTROL :Installation of dependable inventory control measures is often a

complicated exercise. Line managers will never find the time

needed to accomplish such tasks. It is not worth while

employing permanent staff specialists for special projects of a

temporary nature. Call in the external consultant and pay him

off once the assignment is completed.

5. MARKETINGMarketing research, image research, attitude sampling outlet

surveys, test of advertising effectiveness, sales cost appraisals,

etc are short term projects that are best accomplished by use or

consultants.

6. MANAGEMENT INFORMATION SYTEM:A well trained and experienced consultant will install a

dependable management information system in a matter of few

months. Management control is incomplete without an effective

information system.

7. RECRUITMENT:Consultants will save management time and the attendant

costs over such issues as executive search, testing,

arrangement of interviews and securing of reliable references

on new recruits.

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8. TRAINING:A consultant is not successful unless and until he has been

able to transfer knowledge, skill and techniques to the non

expert. If he is successful, he is a good trainer. Use them on

training assignments. Some of them may be willing to run in

plant training sessions that save for the enterprise the

enormous accommodation and traveling costs that would have

arisen if trainees were to participate in external courses.

9. WORK SIMPLIFICATION:Get the consultant to chat with your people and you will find

that he comes back to you with a list of things to do to cut your

costs and increase your profits.

10. OPERATIONS PLANNING:Each functional area within an enterprise (Production, Sales,

Buying, Distribution and Services) will usually be engaged in

planning work. Conflicts, departmental walls, duplication of

efforts and the attendant waste in time, money and manpower

will be avoided or minimized by the introduction of an integrated

planning system that coordinates all the planning efforts within

the enterprise. The installation of such a system and the

requisite planning aids is a short term task that is best handled

using a management consultant with the necessary expertise

and experience in grassroots planning.

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11. STRATEGIC PLANNINGChange in operating circumstances, technological advance,

changes in the size and fortunes of an enterprise will have

important consequences to the strategies of the enterprise.

These changes may affect the profitability of an enterprise as

they may also create new opportunities for the enterprise.

Consultants will be found to be useful in handling the complex

analytical routines that are necessary for establishing the

strengths and weaknesses of the enterprise in the new

situations.

3.4. PERFORMANCE CONSULTINGIn the words of Marc Rosenberg (1990-1991, President,

National society for performance and Instruction), he aptly

remarks that, “Remember training is not what is ultimately

important ………. Performance is”.

A lot of money had been expended on training especially in the

developed industrial economies of the world.

Consider these facts: In North America in 1994, more than $50 billion was

spent on

formal training and development of employees. These are

direct costs only; if the cost of having employees attend

training off the job is added into the equation, the figure

rises to more than $300 billion

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To remain competitive in today’s world, organizations

must have a highly skilled, adaptive, and motivated work

force. There must be a return for the investment made

in training

Can the average only 10 to 20 percent of training

transfers to the

job so that the performance of the employee has been

changed (Brond and Newstrom, 1992 P7).

Unfortunate, what we in the human resources development

(HRD) field have been doing for many years is not working, if

“working” is defined as changing human performance.

As Gloria A. Regalbuto (1992. p.31) has observed :

“organizations do not ask as to deliver what they need; they ask

us to deliver what they believe we can provide --.

And what we are asked to provide – training – is often

ineffective, unnecessary, and expensive.

Occasionally it is even harmful we do just what we are asked to

do – delivering training. We do not do what we are not asked to

do – improve human performance in the workplace.

It is therefore important to transit from the role of traditional

trainer to the role of performance consultant in this regard, one

should be held responsible for the delivery of training

programmes to a responsibility that focuses on changing

human performance and having an impact on the organization.

There must be a programmed change: being viewed as “just a

28

trainer to being valued as a partner to management in the

achievement of performance and business needs.

Performance consulting centres on the following

* Identify performance requirements that are directly linked to

the operational and business goals of an organization.

* Contract with management to take all the actions that are

needed if the identified performance is to be

successfully implemented

* Work in a consultative manner with critical people so that

you become a valued business partner.

* Move from focusing on delivery of training services to be

focusing on performance.

Performance consulting rests on using a rigorous approach of a

systems engineer to analyze design programmes that change or

improve human performance. It is also hinted that the work

environment within which employees operate has a tremendous

impact upon their job output.

The majority of human resource executives who were interviewed

explained the primary reason for a lack of performance results from

human resources initiatives to be “a failure to lack of human

performance systematically to involve all aspects of the organization,

and then to apply comprehensive solutions to performance

problems”.

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The challenges of performance consulting can be summed up this

way :

1. The competitive advantage, and perhaps the survival of an

organisation demands that employees perform at a high level.

2. Traditional training approaches in support of performance

change are not working, primarily . because they are not

system – oriented in their approach to resolving performance

problems – this despite the fact that significant leaders in the

field have been writing about performance approaches for over

thirty five years.

Conclusively, for those in the training and development field at

this time, management and others will seek out those people

who can partner with them to install the performance required

by the organisation.

Those who work effectively in the future must be able to :

Develop collaborative working relationships with key

managers and other partners

Clearly understand the vision and strategies that

management is striving to achieve

Identify the performance required of employees if the

organisation is to thrive.

Determine the conditions in the work of environment

that must be modified if needed performance is to take

root.

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Work with people in and out of management to

determine all the interventions required if high

performance is to be achieved.

Clearly, these activities are outside those of the

traditional training processes.

We must evolve from a training to a performance

perspective. If we do not rise to the occasion now,

others will. We will have missed an opportunity to be

viewed as a value – added partner and will risk being

seen as peripheral to the mainstream of the business.

The time is now! Opportunities wait for no one.

Performance consulting is the process by which we can

work with management and others to identify and

achieve performance excellent linked to business goals.

The message is from now on is : Think performance,

not training !!!

3.5 What is Human Capital Development?Human resource management policies and practices may be

adopted to deliberately instigate career and human capital

development.

Human capital development can be defined according to Bantis

et al (1999) : “Human capital represents the human factors in

the organisation; the combined intelligence, skills and expertise

that gives the organization its distinctive character. The human

elements of the organization are those that are capable of

learning, changing, innovating and providing the creative thrust

31

which if properly motivated can ensure that long-term survival of

the organization.

The term ‘human capital’ was originated by Schutt3 (1961), who

elaborated his concept in 1981 as follows:

“Consider all human abilities to be either innate or acquired.

Attributes … which are valuable and can be augmented by

appropriate investment will be human capital.

Human capital is the most important element in an

organization’s intellectual capital, as defined below

3.5.1 INTELLECTUAL CAPITALIt consists of the stocks and flows of knowledge available to an

organization. These can be regarded as intangible resources

which, together with tangible resources (money and physical

assets), comprise the market or total value of a business.

The three elements of intellectual capital are:

Human capital (as earlier defined)

Social capital: the stocks and flows of knowledge

derived from networks of relationship within and outside

the organizations. The concept of social capital has

been defined by Putman (1996)as ‘the features of social

life – networks, norms and trust – that enable

participants to act together more effectively to pursue

shared objectives.

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The world Bank defines it as “social capital which refers

to the institutions, relationships and norms that shape

the quality of a society’s social interactions…… social

capital is not just the sum of the institutions which

underpin a society – it is the glue that holds them

together

Organizational capital

Youndt (2000) defines this as the institutionalized

knowledge possessed by an organization, which is

stored in databases, manuals and so on. This is often

called structural capital (Edvinson and Malone, 1997),

but the term organizational capital is preferred by

Youndt because he argues, it conveys more clearly that

this is the knowledge that the organization actually

owns.

This tripartite concept of intellectual capital indicates that, while

it is individuals who generate, retain and use knowledge

(human capital), this knowledge is enhanced by the interactions

between them (social capital) to generate the institutionalized

knowledge possessed by an organization (organizational

capital)

It is necessary to capture individual knowledge through

knowledge management processes, but it is equally important

to take into account social capital considerations, that is, the

33

ways in which knowledge is developed through interaction

between people.

Bontis et al (1999) point out that flows as well as stocks matter.

Intellectual capital develops and changes over time, and a

significant part is played in these processes by people acting

together.

3.5.2 THE SIGNIFICANCE OF HUMAN CAPITALThe focus is on the means of attracting, retaining , developing

and maintaining the human capital they represent because it is

the knowledge, skills and abilities of individuals that cerate

value.

(Davenport)

It is severally commented that ‘people posses innate abilities,

behaviours and personal energy and these element make up

the human capital they bring to their work.

And it is they, not their employers, who own this capital and

decide when, how and where they will contribute it.

In other words, they can make choices.

Work is a two-way exchange of value, not a one – way

exploitation of an asset by its owner”

The point emphasized by Davenport, that workers as well as

employers invest in human capital, is in accord with the

34

economic theory of human capital. Human capital theory

conceptualizes workers as embodying a set of skills which can

be “rented out” to employers.

The expected returns on human capital investments for the

worker, are a higher level of earnings, greater job satisfaction,

better career prospects, and at one time, but less so now, a

belief that security in employment is assumed.

Investment by workers in developing transferable skills can be

attractive as means of increasing employability. The costs of

such investments take a psychological social and monetary

form, as spelt out by Elliot (1991)

- Psychological costs are those borne by individuals,

perhaps the less able, who may find learning difficult.

- Social costs take the form of foregone market

opportunities (opportunity costs – the time spent devoted

to investing in human capital could have been spent in

other activities).

- Monetary costs include both direct financial outlays and

foregone market opportunities

- The decision to acquired skills is an investment decision.

- Individuals will invest in human capital if they believe that

the benefits to them will exceed the costs they will incur.

- These benefits consist of the net addition to lifelong

earnings that results from selling skilled rather than

unskilled labour.

35

- For the employer, the returns on investment in human

capital are expected to be improvements in performance,

productivity, flexibility and the capacity to innovate that

should result from enlarging the skill base and increasing

levels of knowledge and competence.

“The general message is persuasive : skills, knowledge and

competencies are key factors in determining whether

organizations and nations will prosper” as suggested by

Schuller (2000)

3.5.3 AN INSIGHT INTO HUMAN CAPITAL THEORYHuman capital theory can be associated with the resource

based view of the firm as developed by Barney (1991) This

proposes that sustainable competitive advantage is attained

when the firm has a human resources pool that cannot be

imitated or substituted by its rivals.

Boxall (1996) refers to this situation as one that confers “human

capital advantage’. But he also notes (1996 and 1999) that a

distribution should be made between “human capital

advantage” and “human process advantage”.

- The former results from employing people with

competitive valuable knowledge and skills, much of it

tacit.

- The latter, however, follows from the establishment of

‘difficult to imitate, highly evolved processes within the

firm, such as cross-departmental cooperation and

36

executive development. Accordingly “ human resource

advantage”, the superiority of one firms labour

management over another’s, can be thought of as the

product of its human capital and human process

advantage

3.5.4 WORKERS AS ASSETS :The added value that people can contribute to an organization

is emphasized by human capital theory. It regards people as

assets, and stresses that investment by organizations in people

will generate worthwhile returns. The theory therefore underpins

the philosophy of human resources management which, as

developed in the 1980s, stated that employees should be

treated as assets rather than costs.

3.5.5 ITS LIMITATION:But as Davenport (1999) maintains, the concept is limited,

indeed questionable, because

Workers should not be treated as passive assets to be

bought, sold and replaced at the whim of their owners.

- Increasingly, they actively control their own working

lives

The notion that companies own human assets as

they own machines is unacceptable in principle and

inapplicable in practice

37

- It short-changes people by placing them in the

same category as plant and equipment

No system of ‘human accounting’ has succeeded in

producing a convincing method of attaching financial

values to human resources; in any case, this demeans

the more intangible added value that can be delivered to

organizations by people.

It should be emphasized that employers need to remember that

workers, especially knowledge workers, may regard themselves

as free agents who can choose how and where they invest their

talents, time and energy.

Investments by employers in training and developing people

are a means of attracting and retaining human capital as well

as getting better returns from those investments. This position

governs the role of management consultants, to a large extent,

in human capital development of any nation.

3.6 HUMAN CAPITAL AND OTHER ASPECTS OF INTELLECTUAL CAPITAL THEORY

As important as human capital theory might be, interest in it

should not divert attention from the other aspects of intellectual

capital – social and organizational capital – which are

38

concerned with developing and embedding the knowledge

possesses by the human capital of an organization.

Schuller (2000) hints that “The focus on human capital as an

individual attribute may lead – arguably has already led – to a

very unbalanced emphasis on the acquisition by individuals of

skills and competencies which ignores the way in which such

knowledge is embedded in a complex web of social

relationships.

Measuring human capital has led to different views which may

not attract us in this paper. There is a good case for evolving

methods of valuing human capital and how it it used as an aid

to decision making. This may mean identifying the key HR

drivers and modeling the effect of varying them. The issue is to

develop a framework within which reliable information can be

collected and analyzed.

However, the significance of the concept of human capital does

not depend on the ability to quantity its value. What human

capital theory can do is to provide the rationale for a ‘resource

capability’ approach to strategic HRM, as advocated by

Kamoche (1996) which will be concerned with the acquisition,

development and retention of human capital in order to achieve

competitive advantage.

At this junction, we may need to note the practical implications

of human capital theory.

39

It focuses attention on

1. Resourcing : Resourcing strategies are concerned with

matching human capital resources to the strategic and

operational needs of the organization, and ensuring the

effective utilization of those resources

2. HRD Strategies – Human resource development

strategies are business – led in that they are initiated by

the strategic plans of the organization and driven by the

human resources plans which define knowledge, skills

and competency requirements.

It aims to attract and retain human capital as well as

develop it

3. Reward strategies :

The implication of human capital theory, from a financial

reward point of view, is that investment in people adds to

their value to the firm.

Individuals expect a return on their own investment, and

have firms to recognize that the increased value of their

employees should be rewarded.

Human capital theory encourages the use of skill based

or competence based pay, a method of reward. It also

underpins the concept of individual market worth. This

indicates that individuals have their own value in the

marketplace, which they acquire and increase through

investments by their employer and themselves in gaining

extra expertise and competence by means of training,

development and experience.

40

The market worth of an individual may be considerably

higher that the market rate of their jobs, and if they are

not rewarded accordingly they may market their talents

elsewhere.

Non-financial reward considerations should also be taken

into account. If workers are investing their human capital

they want to obtain a return not only in the form of

opportunities to grow and to achieve, but also in terms of

being valued by their employer.

Organizations need therefore to consider how to

recognize accomplishments through performance

management processes and formal recognition schemes

4. knowledge management

Organizational effectiveness depend upon making good

use of knowledge, which needs to be developed,

captured and exchanged (knowledge management) in

order to create

organizational capital. In doing so, it should be

remembered that as stated by Daft and Weick (1984), ‘

individual’s come and go, but organizations preserve

knowledge over time’ or as expressed more colourfully by

Fits-enj (2000) , ‘organizational capital (knowledge) stays

behind when the employee leaves; human capital is the

intellectual asset that goes home every night with the

employee’.

41

3.7 REFERENCES :

Fajana, Sola (2002) Human Resource Management An

Introduction, Lagos. Labofin and company.

Robinson D.G and Robinson J.C (195) Performance

Consulting, Moving Beyond Training, Sam Francisco, Beret –

Koehler Publishers

.

Muyiwa – Oni, R.A (2007) Employee Training and Development

Practices in the Banking Industry (A case study of United Bank

for Africa Plc). Unpublished MBA, (LASU) dissertation.

Armstrong, Michael (1997) Human Resource Management

Practice, Va. Kogan Page Ltd

42

CHAPTER FOUR

HUMAN CAPITAL DEVELOPMENT AND TERRY KENDALL Consult Ltd : Problems and Prospects.

“The prosperity of a country lies not on the abundance of its

public buildings, nor on the strength of its military forces

but in the number of its cultivated citizens, in its men of

education, enlightenment and character”

Martin Luther

4.1 THE SYNOPSIS : Human Capital Development and the

Consultant

With our perspective on the key concepts and an insight into

human capital development, the role of any management

consultant is defined by the following factors:

1. The state and level of industrialization, entrepreneurship

awareness and education in any economy

2. The rate of growth of the economy and the capacity

utilization ratio.

3. The consciousness on the part of the organization

(employers) and employees (individuals) to train, develop,

and retain the staff on a strategic basis and be goal driven

and self – fulfilled.

4. The challenges posed by globalization, competitiveness and

intercommunication trainings.

5. The performance management scheme and the reward

systems; and

43

6. Finally the government/industrial infrastructural frameworks

to create a conducive working environment.

The role of a training/performance consultant in particular and that

of management consultant in general can be appreciated when the

governments place emphasis on human capital development in

collaboration with other agents of economic growth and socio-

economic development. These are:

1. The institutional frameworks

2. Policy changes and relevance

3. Human capital development

4. Culture

5. Leadership and

6. Entrepreneurship

The fundamental issue: How do they train, develop and retain the

manpower? Is the human capital developed substantially by both

the private and public sectors in addition to individual’s awareness

and commitment to develop portable and transferable skills and

competencies? Is the human capital development nourished and

supported by good health care schemes?

Are the manpower not being ravaged by HIV/AIDS and accidents

on our roads for non or inadequate maintenance. Are the

leadership both at the industrial sector and at Federal, State and

Local governments responsive to and effectively managing

change? Are the resources not been deliberately wasted by

inadequate planning and unstructured growth in the tertiary

institutions thereby promoting a wide – scale unemployment apart

44

from apparent under-employment in virtually all sectors of the

economy?

These are the critical challenges apart from poor industrial and

social infrastructures, corruption and mismanagement here and

there.

4.2 THE EDUCATION SECTOR AND TRAINING AND DEVELOPMENT.

The educational sector does not attract adequate and proper

attention it should obtain. The budget allocation is grossly

inadequate apart from mismanagement of budgetary provisions.

One can not effectively claim that the educational sector is well

planned to address the issues of national, sectorial and industrial

needs from year to year. Manpower planning has not been able to

address critical issues of optimal utilization of manpower resources

in most of developing or more appropriately les-developed nations

including Nigeria.

The importance of training and performance management has not

attracted the attention of the governments as well as the private

sector. Only few foreign-based or turned organization do not pay

lip service to human capital development and the growing financial

sector.

There have been a lot of problems faced by the management

consulting outfits. Some of the problems are :

45

1. Poorly qualified and/or unqualified and unprofessional

“management consultants’ with no input to make in

performance enhancement challenges/tasks

2. Inadequate training by the would be consultants]

3. Inadequate training infrastructure in addition to poor reading

culture

4. They emphasis more of training than embarking on

performance consulting.

5. Brickwalls often erected against new consultants who want to

win new clients and extend effective training and manpower

development strategies.

6. Corruption and unethical practices which do not expose

consultants to competition and challenges. In not companies

and government establishments, their cronies are used as

consultants which in most cases can hardly deliver.

7. The consciousness that every retrenched employees and

unemployed graduates/Nigerians brand themselves as

consultants’. And a host of other factors.

TERRY KENDALL Consult Ltd in a concerted effort to contribute

positively to the growth of the human capital development has

been variously engaged as training/performance consulting

consultants to both private and public sectors of the Nigerian

economy. The added focus of the establishment Terry Kendall

Leadership Academy is to train and equip Nigerians with sound

and life-challenging transformational leadership and

entrepreneurship skills and competencies. The campaign is on; we

46

are challenged through Ralph Maxwell Consulting to embark on

training, project management and HR services.

Our recent launching of The 21st Century Effective Manpower is a

step in the right direction to publish management Journals on

quarterly basis and also produce revision packs for undergraduate,

postgraduate students and teeming population of working

managers/supervisors and the unemployed youths. This is

purposed to positively influence the level of management literacy

and eventual growth of the human capital formation/development.

This is challenging; but with a total commitment and dedication’ we

can effectively influence the sustained growth of the human capital

if other colleagues join hands to lift Nigeria up. With a spirit of

commitment and nationalism, we shall be there!

For any professional consultant to make a worthwhile contribution

to the development of the nation human capitals, there is need for

continuous learning and updating of knowledge, skills and

techniques that are fundamental, portable and transferable to the

trainees and organizations from time to time. Adequate knowledge

of KT is a sine qua non for effective consulting and management.

There is also an ever increasing need to partnership with the

tertiary institutions, the private and the public sectors of the

economy.

As a mater of utmost urgency, there must be an increasing

awareness, application and development of sound and

performance – driven management systems. And functional

47

human resource planning that determines the human resources

required by the organization to achieve its strategic goals must be

in place to take care of the immediate, short-term and long-term

needs of the organizations.

In this perspective, there must a concentrated programme on

productivity enhancement through attitudinal change and the need

for personal development and transformations. The effect of 1+1

=3 principle of multiplier should be brought to bear on the

management process. And more importantly, the culture and

climate of the organizations/business should be conducive,

challenging and investment receptive.

Terry Kendall group can only contribute positively and effectively

to grow the human capital formation/development in cooperation

and conjunction with other consulting firms, the private and the

public sectors as well as the avowed interests of working

population and in fact every individuals with fervent commitment to

add – value to lives and workplace responsibilities and tasks

4.3 THE PROSPECTS AND CHALLENGESNo nation attains a sustained economic growth and socio-

economic development without adequate planning and strategic

orientation matter is neither created non destroyed, every object

remains a in a state of nature until a force is applied to it.

The economic manpower should be tasked to plan and plan

effectively and harness al the economic resources to the benefits

48

of her citizens. Every Nigerian should be challenged to rededicate

himself/herself to render the best of services and continually

improve its contribution to the concept of productivity and value

creation and management.

The industrial and socio-economic infrastructures such as energy

which now assumes an important factor as an agent of production,

spirit of nationalism, good business ethics and value systems and

opportunities to grow and be creative as entrepreneurs should be

put in place. The educational system should be revitalized and

planned so that the amount required in specific sectors are

produced on a strategic basis.

Management education should be emphasized and functional and

heavily subsidized health care services should be put in place.

There are prospects. There are no underdeveloped countries, we

only have under managed or mismanaged nations. Management

is the prime mover and development is the consequence of

effective management

The application and constant training and retaining of staff in the

financial sector of the nation has prompted good and result –

oriented management practices. This has positively impacted on

their operational performances, attitudinal change and

development of characters that attract value added appreciation.

Most of the thriving organizations in Nigeria particularly in the oil

sector and foreign – based organizations apply good and effective

management practices with emphasis on strategic management,

49

transformational leadership and performance consulting and

management.

50

4.4 REFERENCESOladimeji Alo (2000) Managing the Human Capital for

National Development, Institute of Personnel Management,

Anmal Lecture, Mouson Centre

Ray Killean, (1976) Human Resource Management: An ROI

Approach, AMACOM ; A Division of American Management 74

Association p8

Armstrong Micheal (2005) Human Resource Management

Practice, VA Kogan Page Limited

Muyiwa – Oni, R.A (2007) Employee Training and Development

Practices in the Banking Industry: (A case study of United Bank

for Africa Plc) Unpublished MBA – (LASU) dissertation.

Nwachukwu, CC (2005) Management Theory and Practice,

Onisha, Africana FEP Publishers Ltd

Obisi C (2003) Organizational Behaviour – Concepts and

Applications, Lagos, Matt House Press Limited

Muyiwa – Oni, R.A (2008) An overview of ‘Improving your

Operational Performances’ A seminar paper delivered to MFM ministries Battlecry, Tapes & Publication unit on October 29,

2008.

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CHAPTER FIVE

SUMMARY OF FINDINGS, CONCLUSIONS AND RECOMMENDATIONS

“Since we are capable of modifications the future will be in many

ways only as good as we have the courage to make it”

- June Tapp

5.1 SUMMARY OF FINDINGS:Management involves working with and through people to

accomplish organizational objectives. And the field of management

is the totality of concern with the human resources of

organizations. Management holds the key that unlocks the forces

of economic and social development in any nation. The driving

force behind this is man. And man constitutes the human capital of

any organization or nation.

Human capital development consist of the knowledge, skills and

abilities of the people employed in an organization. It is the human

factor in the organization. It is the most important element in an

organizations intellectual capital and it consists the stocks and

flows of knowledge available to an organization. The value of the

human capital must be continually enhanced and motivated to

ensure its optimal utilization.

52

The management consultant as a professional expert works with

the members of staff of any organization to find out the areas that

need advice, diagnosis and proffering of management solutions.

The consultant is charged and equipped with excellent

professional ethics, skills, attitudes, techniques and what have you

to get the desired results through the cooperation with others in

any organization. In this perspective the consultant, as a training

and performance consultant consulting would enhance the skills,

competencies, attitudes and techniques of the staff with a view to

positively influence and increase the human capital formation of

any organization or nation.

This is achieved by instituting good policies and establishing good

environments and climate that would propel increased productivity:

Investment in human capital is a two-way affair the workers as well

as employers invest in human capital. Investment by workers on

developing transferable skills can be attractive as means of

increasing employability.

It is incontrovertible that for management consultants to positively

influence the stocks and flows of human capital, fundamental

infrastructures must be available, industrial growth and

performance management must be established and more

importantly every emphasis must be placed on developing the

human capital.

53

In fact, the critical importance of people in the achievement of

organizational objective should be the focus.

5.2 RECOMMENDATIONS :In view of the foregoing, it is hereby recommended that for a

nation or indeed an organization to enhance its human capital

development through training and manpower development,

education and modern technology, the following issues must be

taken into consideration :

1. There is need for strategic planning and transformational

leadership skills to proactively position itself for competitiveness

and meeting the challenges of the present and the future

2. The management consultants should be continuously trained

and updated to evaluate training objectives and the impact and

relevance of performance consulting and management

3. Both the private and public sectors should use professional

consultants optimally to advice and solve day-to-day

management problems/challenges.

4. The educational system should be well focused and dynamised

to take account of development in human capital management

and developments all over the world as the whole world is now

“global village”. The educational system vis-à-vis the production

of graduates of tertiary institutions should be tailored to the

present and future needs of the organization/nation.

5. The health/medical care services should be adequately funded

so that life expectancy of the people can increase. There is no

point spending a lot of money developing the human capital

only to be ravaged by HIV/AIDS.

54

6. The cultural factors should also attract attention so as to

increase the level of productivity which would stimulate the

gross domestic products as well as the need for consultancy

services.

FINAL NOTEThere should be a functional partnership between the private and

the public sectors to harness the potentials of the people to propel

the human capital development through effective educational

policies, training, performance consulting and creating the

awareness and consciousness to continually improve ourselves

and our performances. Here lies the challenge!

The issue of human capital development is fundamental and every

attempt should be made increase its stocks and flows from one

generation to another. Our commitment to grow and meet the

goals and objectives of organizations or nations is premised on the

development and optimal utilization of human capital.

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5.3 REFERENCES:Nicholas Harman, “The most African Country: Nigerian Survey”.

The Economist, Jands’

Oladimeji Alo (2000), Managing the Human Capital for National

Development, Institute of Personnel Management, Annual

Lecture Mouson Centre.

Fredrick H. Harbison (1973) Human Resources as the Wealth

of Nations, New York Oxford University Press p.3

Ray, Killan (1976) Human Resource Management

An ROI Approach, AMACOM. A Division of American

Management Association p8

Aina, Sola, (2005) Managing the Human Capital in Nigeria

Ikeja, Fountain Training Consult.

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57