Role of HR Architecture on Intellectual Capital

HR configurations facilitate flow of knowledge, which leads to sustainable competitive advantage. HR practices have a central importance in knowledge intensive industries because they have immediate effect on the organisation's key resources. HR practices are especially important in attracting, retaining and developing the skills and knowledge of employees. HR strategy drives the long term strategy of the business. So HR practices must be deliberately chosen and used strategically to maintain strong organisational boundaries, to promote high levels of organisational and professional identity more specifically it encourages the retention of staff in a highly competitive industry. The study concentrates on, how the firms configure the entire HR system so that enhancement and exploitation of knowledge embedded in their people and in other forms of intellectual capital can be facilitated. A contingent configurational perspective is adopted in the study and hypothesised that the performance impact of HR configurations depends on the variables like human, social, or organisational capital. The study proposes a holistic HR practice and focuses on configurations of multiple HR activities that is vital for intellectual capital management.