Workplace Well-being: How to Build Psychologically Healthy Workplaces

7 Employee Development and Growth

Raymond A. Noe¹ and Michael J. Tews²

¹ Ohio State University, Columbus, OH, USA

² Penn State University, State College, PA, USA

The development of human capital is a key to achieving and sustaining a competitive advantage in today’s turbulent marketplace (Hatch & Dyer, 2004). Human capital refers to an organization’s collective knowledge, advanced skills, system understanding and creativity, and motivation among its workforce to deliver high-quality products and services. Human capital includes both explicit knowledge and tacit knowledge. Explicit knowledge is knowledge that is well documented and easily articulated (Nonaka & Takeuchi, 1995). Tacit knowledge, which is arguably more important, is knowledge that is subconsciously understood based on experience (Nonaka & Takeuchi, 1995). Scholars have argued that human capital may be even more valuable than physical capital and financial capital because human capital requirements are unique to a particular organizational context and are difficult to imitate and purchase (Barney, 2001). Regardless of their level or position, employees and the skill sets they possess can make or break the success of an organization.

It is not surprising that organizations promote a variety of employee development activities to enhance the human capital of their workforce. We conceptualize employee development to include formal and informal learning activities, such as classroom programs, computer-based training, ...