The human capital and human resource management relationships in non-profit organisations: misunderstanding and implication

Abstract

Through qualitative in-depth semi-structure interviews with 35 senior non-profit executives in 22 Non-Profit Organisations (NPOs) in Australia, it was found that Human Capital (HC) and Human Resource Management (HRM) were perceived to be identical and interchangeable. However, the two concepts are conceptually different. Drawing from the interview data, non-profit executives’ strategic decision-making in relation to knowledge development, application and dissemination was distorted due to the misunderstanding of the two concepts. Thus the contribution of the paper is to provide non-profit executives, particularly who are directly involved in HRM, an improved understanding of the two concepts which leads to a better implementation of human resource strategy.