Human capital development in the international organization: rhetoric and reality

The purpose of this study is to present empirical evidence of the nature of corporate rhetoric in developing human capital and how it becomes embedded within a large international organization operating in the Nordic region. The qualitative case study aims to examine the sensemaking of individual managers, and how human capital rhetoric is selected, acted upon, and retained by employees.

An exploratory case study approach is taken in order to provide an in‐depth understanding of the rhetoric and reality of human capital development. Focus groups, archival data, and interviews with key informants (i.e. external consultants, senior executives, managers, and employees from various departments across the Nordic business units) are used to explore different perspectives on the phenomena of human capital development.

The findings highlight a number of key dimensions that can distort the rhetoric of human capital: corporate strategy, organizational structure, managerial style, and the cognitive frames of individuals.

The study suggests a need for senior managers to take pre‐emptive actions to close the gap between the rhetoric of human capital development and what actually happens in practice. A lack of clarity concerning human capital concepts and their outcomes is to be overcome through more effective communication strategies.

The research suggests that managers construct rhetoric that has to be absorbed by multiple audiences and that, in some cases, a counter‐rhetoric of human capital is formed. Employees interpret human capital rhetoric, shape it and alter it in their own interests. Ambiguity and ignorance over human capital concepts is succeeded by pragmatic assessment and refinement on the part of employees, with the initial human capital development program iteratively amended as it passes through the organization.