Classification of human capital in the framework of enterprise

Human capital as an economic category has become one of the core concepts of economy, that allow to describe and explain many economic processes through the prism of human interests and actions.

Human capital is a combination of its elements. In this case there is also no single approach to defining elements of human capital, each author interprets it from his/her point of view. Depending on the degree of human capital generality the following components can be described in its structure: individual, collective and public. This classification of human capital allows us to consider and evaluate the human capital at the level of an individual (micro level – the individual human capital), a particular enterprise or group of enterprises (mesolevel – the human capital of the company) and the state as a whole (macro level – the national human capital).1

Human capital of an individual employee within an enterprise is a reserve of strength and energy available from the employee, which can be mobilized and used to achieve a certain goal, a plan, to solve a particular issue for a company at any moment.

As a rule, the calculation of this value should be determined by an employee's personal contribution to the final economic results of business structure. However, in some cases the company faces difficulties, and sometimes it's even impossible to determine the personal contribution of an employee to the final results. Therefore, to determine the cost one has to analyze the employee according to the following parameters.

Here is the author's classification of factors affecting the calculation of the human capital amount specific to an individual employee of the enterprise:

• 1)    sex of an employee (sexism is excluded);

• 2)   qualification level;

• 3)   continuity of employment;

• 4)    value of a position, occupied by the employee, for an enterprise;

• 5)   age;

• 6)   marital status;

• 7)    constant desire of an employee to improve its professional and qualification level;

• 8)    ability to self-learning;

• 9)    the frequency of an employee's transfer (migration) from one enterprise to another;

• 10)    constant and increased interest in the work performed;

• 11)    ability to create, develop and make unconventional management decisions;

• 12)    ability to take effective management decisions and other ones within short terms;

• 13)    employee's consent to work extra hours if necessary;

• 14)    experience in modern computer and information technologies;

• 15)    knowledge of foreign languages;

• 16)    computer skills;

• 17)    employee's ability to work successfully in a team.

Human capital of a particular employee may be conventionally classified into the initial capital and the acquired one. Initial capital is what was laid down in the human being in terms of genetics, as well as developed in childhood. This can include physical health, physical strength, endurance, immunity; here the background of the future performance specific to a future employee may be observed. Creativity, that tends to be showed up unequally in different people, any innate and developed skills that distinguish a particular person from the rest. This category includes psychological health of the individual as well.

The second group is acquired capital.

Acquired capital can include: education, different CPDs, development of creativity, development of business skills, socialization within a company.

It should be noted that the main vocation of a human is the desire to learn something new, and hence the desire to learn. Over time technologies, ideologies, demand for specialty are changing, but education shall stay continuous. Every modern employee must understand that knowledge received fifteen, ten, or even five years ago, is not enough to perform the work appropriately. In the West knowledge is recognized to become obsolete within five years. In the Soviet Union, people could self-improve the whole life – receive the second higher education, improve their qualifications in specialized institutions. Continuous education was paid by the state or company which sent its employees to the educational institution.

There are also several factors to be noted that give a positive motivation for an employee and as a consequence lead to the increase in the cost of a particular employee's capacity:

• –    Employee's career (employer's plan to promote an employee);

• –    Good psychological climate among company's employees;

• –    Developed system of incentives to achieve the desired results of labor (including material, social, career, extra, psychological incentives etc.);

• –    Safety and comfort conditions of labor.²

Human capital of all employees in aggregate – this is a general (quantitative and qualitative) feature of staff as one of the resources associated with the fulfillment of its functions and the achievement of long-term goals specific to the development of the enterprise; it is actual and potential abilities of employees as a whole system that are used and can be used within the specific period of time³.

In order to calculate the human capital of all employees, it is necessary to conduct a detailed analysis of all the factors described above (the human capital of the individual employee), and summarize the results of calculations for the cost of each employee's capacity. We should not forget that the result of calculation for human capital specific to all employees is always larger than the sum of its parts by virtue of the synergistic effect due to the interaction of the constituent elements.