CHAPTER ONE

INTRODUCTION
“You can get capital and erect building, but it takes people to
build a business"
Thomas J. Watson
Founder, IBM.
1.1 Background of the study
We cannot overemphasize the need for qualified, competent
and experienced work force in the development process of any
nation or organisation. The quality of the labour force and
accelerated pace of development taking place in development
economies have accentuated the need for seasoned managers
to pilot development efforts.

The event in Nigeria in the past decade where manufacturing

subsector had been characterized by low capacity utilization
(which average 30 percent to be modest), low and negative
growth rate, and high import content/dependence for
technologies and inputs partly due to lack of proper strategic
planning, call for properly groomed, seasoned and experienced
managers to formulate and promote good corporate
governance. Most of the problems confronting the Nigerian
nation are traceable to poor management.

Management holds the key that unlocks the forces of economic

and social development in any modern economy. It is therefore
a must for managers and infact, the total workforce to learn

1
basic principles, skills and techniques including organisation
behaviour and appreciate the difficulties encountered by key
management in guiding and directing the organisation as an
integrated unit.

This invites an attempt to juxtaposition the essence of

management in human capital development.
Human Capital Development consists of the knowledge, skills
and abilities of the people employed in an organisation or in a
nation (Armstrong M. 2005).

The human capital development in the words of Bontis'et al

(1999) is defined as "the human factor” in the organisation; the
combined intelligence, skills and expertise that gives the
organisation its distinctive character. The human elements of
the organisation are those that are capable of learning,
changing, innovating and providing the creative thrust which if
properly motivated can ensure the long-term survival of the
organisation.

Human capital is the most important element in an

organizations intellectual capitals and it consists of the stocks
and flows of knowledge available to an organisation.

It is the knowledge, skills and abilities of individuals that create

value, which is why the focus has to be on means of attracting,
retaining, developing and maintaining the human capital they
represent.

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 As commented aptly by Davenport (1999) that "people possess
innate abilities, behaviours and personal energy and these
elements make up the human capital they bring to their work”.

It is in this perspective of enhancing the value and relevance of

the human capital on a continuous basis that the impact and
eventual contribution of management consulting, and in fact
training and performance consulting is appreciated and
evaluated. Enhancing the value, updating the related
management knowledge and development of attitudes, values,
skills, competencies and techniques are the critical issue in
developing and sustaining human capital development viz-a-viz
intellectual capital of a nation. The agents of the change are
leadership, entrepreneurship education, training and manpower
development in a strategic focus.

1.2 STATEMENT OF THE PROBLEM OF THE STUDY.

Terry Kendall Consult Ltd is one of the management
consulting firms in Nigeria with a commitment to provide and
encourage the acquisition of skills in industry and commerce
with a view to generating a pool of indigenous manpower
sufficient to meet the needs of the nations. Terry Kendall
Consult Ltd (Terry Kendall in short) employees are 15 with a
branch outside Lagos. The employees are made of both
managers and non-managers.

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 The issue is how does Terry Kendall contribute to the
development of human capital development in Nigeria by way
of training and manpower development.

1.3 THE OBJECTIVES OF THE STUDY:

The following objectives are defined for the study:
1. To define the role of management consultant
2. To appreciate and understand what human capital development
is all about
3. To examine the role of Terry Kendall Consult Ltd in meeting the
challenges of improving or enhancing the value, stock and
relevance of human capital development in prompting
economic growth and development of the nation and
4. Finally, to examine various factors impeding and enhancing the
role of management consulting in assuming the indisputable
agent or catalyst of change in economic growth and national
transformation.

5. SCOPE AND LIMITATION OF THE STUDY

The study is only about Terry Kendall Consult Ltd consulting
and training role in an attempt to improve the stock and flows of
human capital development of the nation. This means that no
other aspect of the company is studied. The study therefore
qualifies for the tripod (Kaplan, 1964: 78) or triangular principles
of scientific research (Bringbeng and Nachimal's 1986 : 161)

4
 The triangle represents what Nachimal's and Nachimal's (1974 :
56) call unit of analysis or locus of problem (Kaplan 1964 : 78)
The figure below demonstrates the scope of this study.

A
Training
Discussion Performance
Consulting
B C
Lagos metropolis
SPACIAL DIMENSION (TERRY
KENDALL
GROUP).

Figure 1: Triangular - Scope of the study

The triangular ABC fixes the subject of the research

(consulting) in relation with its spatial (Lagos Metropolis) study
population.

The limitations of the study are that the study is situated in only
one organisation. The implication is that the result will only be
applicable or generallable to Terry Kendall group.

5
1.4 SIGNIFICANCE OF THE STUDY
The results of this study will reveal the impact, though
insignificant, Terry Kendall group is making towards
management education and training/consulting, management
awareness and consciousness.

The study will demonstrate the role of consulting in human

capital development and the vision of the company to positively
impact on the stocks and flows of human capital development
in partnership with other management consulting firms in
Nigeria and all over the world since the global world has
exposed every transaction no matter how localized, to every
body in every climate, apart from the ever increasing
competitiveness.

1.5 DEFINITION OF TERMS

ROLE
When faced with any situation, e.g carrying out a job, people
have to enact a role in order to manage that situation. The
person must act within situations: situations are rule - governed
and how a person behaves often prescribed by these socially
acquired roles.

Thus the person adopts a suitable role in order to perform

effectively within the situation.

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HUMAN CAPITAL
It consists of the knowledge, skills and abilities of the people
employed in an organisation.

INTELLECTUAL CAPITAL
It consists of the stocks and flows of knowledge available to an
organisation. These can be regarded as intangible resources
which, together with tangible resources (money and physical
assets), comprise the market or total value of a business.

KNOWLEDGE MANAGEMENT
The purpose of knowledge management is to capture a
company's collective expertise and distribute the biggest payoff"

Knowledge management is about getting knowledge from those

who have it to those who need it in order to improve
organizational effectiveness.

Knowledge management is "any process or practice of creating,

acquiring, capturing, sharing and using knowledge, wherever it
resides, to enhance learning and performance in organizations.

Knowledge management involves transforming knowledge

resources by identifying relevant information and then
disseminating it so that learning can take place.

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MANAGEMENT CONSULTANT.
Management consultant is a person or a group of people with
relevant management skills, attitudes, competencies,
techniques and what have you, purposed to proffer
management solutions to organizational problems and /or
challenges.

It is a professionally trained expert in specific area of

management or vocation.

TRAINING
This is a process or procedure through which the skills, talent
and knowledge of an employee is enhanced or increased.

DEVELOPMENT
This is concerned with preparing the employee so that they can
move with the organisation as it develops, changes and grows.

EDUCATION
Education encompasses all the process and activities designed
to improve the overall competence of an employee in a
specified direction and beyond the job currently held.
It entails preparing people for life.

LEARNING
This is any relatively permanent change in behaviour as a result
of observation and experience

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ORGANISATIONAL DEVELOPMENT
This is a deliberate, holistic and planned intervention, inputs or
stepping into remove obstacles and bottlenecks coming in the
way of the effective running of an organisation with more
emphasis on the people and their tools, processes and system
and sub-systems of work for the achievement of organisation
effectiveness.

CAREER DEVELOPMENT
This entails the development of the career of an individual
employee along a clearly defined career path by harnessing his
plan into the corporate plan

CAREER
This is a sequence of separate, but related work activities that
provide continuity, order and meaning in some ones work life.

It is a profession in which a person specializes in a permanent

employment as well as the sequence of work related position
occupied throughout a person's life.

CAREER PATH
This is the modus of achieving a career through a successive
patterned progression.

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TRAINING EFFECTIVENESS
The ability of employee training and development to achieve
defined objectives.

EMPLOYEE ATTITUDE
The disposition of employee to accept or reject training and
development

MANAGEMENT ATTITUDE
The disposition of management to approve or disapprove
training and development

SUCCESSSION PLANNING
This has to do with the process of grooming the necessary
manpower to fill those positions from which the incumbent will
retire within a foreseeable future or for position where the
incumbent resigns, dies or is terminated.

PERFORMANCE CONSULTANT
Where the purpose and focus of the role is to partner with
management to identify and achieve performance excellence.

HUMAN RESOURCES MANAGEMENT (HRM)

It is a strategic and coherent approach to the management of
an organization’s most valued assets: the people working there

10
who individually and collectively contribute to the achievement
of its objectives.

HRM GOALS
It helps the organisation to achieve success through people.
It is concerned with both meeting human capital requirements
and the development of process capabilities in other words, the
ability to get things done effectively.

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1.6 REFERENCES

Michael Armstrong (1977), Human Resources Management

Practice. 9th Edition London and Sterling, VA.New Delhc
Kogan Page Limited,

Dana Gaines Robinson & James C. Robinson (1905),

Performance Consulting: Moving Beyond Training. San
Francisio CA. Berret Koehler Publishers, Inc.

Obisi C (2003) Organisational Behaviour - Concepts and

Applications. Lagos Malt House Press Limited

Obisi C (1996) Personnel Management, Ibadan, Jackbod

Enterprises.

Nwachukwu C.C. Management Theory and Practice, Onitsha

Africana FEP Publisher Ltd

Luthans Fred and Hodgetts m (1992) Business New york The

Dryden Press.

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 CHAPTER TWO

2. BRIEF HISTORICAL BACKGROUND AND OBJECTIVES OF

TERRY KENDALL CONSULT LTD - (THE TERRY KENDALL

GROUP).

In an increasingly knowledge based economy, information is

becoming at least as important as land and physical capital.

If African countries cannot take advantage of the information

revolution and sure this great divide and experience
technological change, they may be crushed by it"
- The World Bank

"The scarcity of human resources is not one of numbers, for our

population has been increasing.

It is rather a scarcity of trained people with adequate

experience in doing difficult tasks willing and able to undertake
the responsibilities that follow from greater innovation and
greater complexity in business enterprises.
- Daiton McFarland

2.1. BACKGROUND :
TERRY KENDALL Consult Limited was incorporated on
December 16, 1987 with the aim of providing and encouraging

13
 the acquisition of skills in industry and commerce with a view to
generating a pool of indigenous manpower sufficient to meet
the needs of the nations.

The following are the key areas of concentration by Terry

Kendall Group.
- involved in organizing courses and seminars, training and
retraining of staff to meet new challenges
- focusing on appropriate management solution for
developmental and business problems in emerging
nations with particular emphasis on the Nigerian business
environment
- combining practical experience with an understanding of
global business realities and sensitivity to cultural
differences, and
- emphasizing recruitment, training, performance
consulting, skills, competencies as well as technology.

TERRY KENDALL has three main subsidiaries:

1. Ralph Maxwell Consulting (RMC) Is involved in Human
Resources Consulting, Training, Recruitments, Labour
Relations, Performance Consulting and Management
Consulting.
2. TERRY KENDALL Leadership Academy (TKLA).
It organizes short-term and day release and weekend
programmes in Leadership and Entrepreneurship Development.
It also runs and conducts examinations on foundation and

14
 professional certificates on Leadership and Entrepreneurship
Development.

3. The 21st Century Effective Manager.

It is published on quarterly basis and focuses on management
development. It also publishes books on Economics,
Management, International Relations etc and Revision packs
for undergraduate and postgraduate/professional students in all
fields of social and management sciences.

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 CHAPTER THREE

3. THE ROLE OF MANAGEMENT CONSULTANT IN HUMAN

CAPITAL DEVELOPMENT OF THE NATION

Most managers have discovered that productive work cannot

be achieved through command, order to executive fiat.
Improved employee productivity depends on individual
motivation.
Brain Rapp. Public Management, May 1978.

3.1 The Management Consultant

The task of planning an enterprise for profitability leads us to
one inescapable conclusion: that there is no enterprise that can
be so perfect that it will not have problems. Problems there will
be, and the majority of these will be created for the enterprise
by its operating environment such as changes in social,
economic and political strategies within the national economy.
There will be problems that will emanate from the activities of
other enterprises, whether they be competitors or
complementary organizations.

There will be problems, too, that will be imposed on the

enterprise by the conflicting goals of the various interest groups
within the enterprise itself. As a matter of fact, problems are the
germs that make an enterprise tick; they are the milestones by
which enterprises performance can be sensibly measured.

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 The question therefore is not whether managers will run into
enterprise problems, but what managers will do with problems
when they arise, and what the owners of business or their
accredited representatives the Board of Directors will expect
managers to do when problems of extra-ordinary nature arise.

3.1.2 MANAGERS ARE BUSY PEOPLE

By the nature of their tasks, managers are very busy people.
Ask any manager how he spends his day and if he is
conscientious, he will tell you that he works between twelve and
sixteen hours per day. He is lucky if he contains his daily
routines within 80% of his working day. He spends the greater
part of his working day helping other people out of their
problems; he settles down to his own specific task after the
official closing hours. Even this achievement depends on
whether he is courageous enough to get rid of other peoples'
problems by the close of the working day. In Nigeria, for
instance, most people are tempted to believe that they will get
better attention from managers after the official closing hours,
and this is commonly believed to be the unwritten part of his job
specification.

3.1.3 MANAGERS NEED HELP

It could assume that managers working under such pressure as
we have described would:

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(a) Reaffirm their total commitment to planning for the
profitability of their enterprises.
(b) Solicit support where they find themselves soaked by
daily routines to the detriment of their first task as
managers planning.
(c) Deserve sympathy from the owners of business or their
representatives the Board of Directors where and when
the needs arise to give management a helping hand in
planning work.

Unfortunately, none of these assumptions holds true.

Managers either do not realize, or they are too conscious of
their performance rating, that they hesitate to call for help when
help is needed to sustain the planning aspects of their jobs.
Consequently, managers grapple with the routines and allow
their planning work to suffer. Enterprises run out of strategies
and managers get blamed for mismanagement.

In those instances where managers venture to propose an

invitation to external experts to help sort out strategic issues or
provide specialist planning data, tools and techniques, Boards
of Companies often get scared by consultancy fee however
meager this might be. As such, managers get gunned down by
Boards, and once beaten twice shy the managers become.

Managers deserve sympathy from owners of business or their

representatives. it is sheer rhetoric to express confidence, as
Boards often do, in the competence of management when

18
 rejecting management proposals for consultancy work. True
enough, managers are often recruited from the best of
materials available at the time, but it is equally true that no
organisation ever budgets for spare management personnel.
This is understandable because skilled managers are both
costly and scare to come by. Every managers experienced
enough to understand the intricacies of his enterprises will
already have been fully stretched to the extent that he may find
it tough to find a few minutes a day for strategic planning work.
The problem is therefore not one of managers being
incompetent but that of their not being allowed by the ordinary
pressures of the business and its environment to settle down to
the often complicated and time consuming planning routines
that are necessary for growth and survival of their
organizations.

3.1.4 CONSULTANTS TO THE RESCUE

Since the days of industrial revolution, there has been an
increasing use of management consultants. Henry Fayol (Time
and Motion Study) Abraham Maslow (Hierarchy of Needs in
Motivation) and Frederic Herzberg (Job Enrichment), to name a
few developed important management principles and
techniques borne out of practical experiences in enterprises.
They became both eager and willing to share their experience
so much so that they trained the people who later spread the
use of the methods and techniques so developed across the

19
 industrialized world. Since then, management consultants have
come to stay for very good reasons.

3.1.5 WHY ENTERPRISES ENGAGE CONSULTANTS

Some of the good reasons for engaging the management
consultants are as follows:
1. A manager may wish to have an objective study of his
problem by an expert.
2. He may want refresh original thinking done on his
problem.
3. He may want to have a techniques or procedure installed,
a task which there is no spare person within the
organisation to major on.
4. He may want to develop the people in his organisation
through contact with outside viewpoint.
5. He may wish to augment his regular staff to handle a
temporary overload of work for which he may not wish
to add permanent employees.

It is clear therefore that every enterprises will, one time or other,

have cause to want to call in a management consultant, if only
on the basis that "a new broom sweeps cleaner". In a number
of situations, enterprises will find that some of their people are
more open to external consultants concerning their work
problems than they would have been to their own colleagues.
People tend to fear that their own colleagues will expose or
criticize them for incompetence thus undermining their self
respect.

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 Like the judge sitting in the courts or the physician attending to
thousand of medical cases, the management consultant worth
his salt becomes exposed to a variety of business problems
through his wide range of contacts and working experiences.
This does not make him any better brain than the operating
managers, but through exposure he is often able to compare
and contrast business cases and the consequences on the
tools and techniques that were used in resolving those cases.

3.2 CHOICE OF CONSULTANTS

Certainly, all managers sometimes feel the urge to call in

outside help in resolving certain types of business problems.
They may be slow to act or will never act at all depending on
their state of knowledge as to where to call for help and which
particular consultant to call.
In the absence of a body representing management consulting
practitioners and regulating their activities, this problem is very
real. Some of the several firms and individuals engaged in
consulting activities are either unknown or are treated with
suspicion in terms of their integrity and professional
attainments. Many of the persons and firms posing as
management consultants are either drop outs from the field of
management or newly qualified persons with little or no
experience looking for quick monetary gains.

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These are the group that have done the greatest disservice to
the course of management consultancy. They are mainly
responsible for the volumes of reports that are often towed
away somewhere in the achieves gathering dust and never
used. They alone are responsible for systems that have
collapsed soon after the departure of the "consultants" who
introduced such system. They are the ones to dread.

Having said that, managers should be rest assured that among

the hundreds of management consultancy firms in modern
industrial and commercial centres, there are a few with the
requisite ability to handle the field of their claim. The one man
show consulting firms can be particularly dependable and worth
trying. They are usually people with a wealth of experience and
a sense of mission in their chosen field who earn their living by
their reputation for good job. They will usually prefer to start a
project and finish it themselves, and will act more as a catalyst
for the organizations engaging them, a posture which enables
them to carry the organization with them in the changes that are
introduced.

The institutional consultants on the other hand are a mixture of

'good and evil'. On the credit side they are always able to
deploy a mixed team of expert, an accountant, an economist, a
behavioral scientist, statistician and an engineer. Such a team
attacking a business problem is likely to come up with a
solution that satisfies the needs of most of the functional areas
of the enterprises.

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On the liability side, an institutional consulting firm may well
allow a highly qualified hand but one who has had little or no
real practice on line management to introduce solutions that
turn out to be good only in theory. In practice, however, this
disadvantage is usually kept under control through supervision
of the work done. Team leaders in well organized consulting
firms are usually people of extensive practice and experience,
who are able to control the output of the less experienced
members of their team.

However, consultants do not generally advertise their services.

In societies where there are associations of management
consultants, the problem of choice will be minimized through
contact with such associations either directly or through their
publications, reports and grading.
Where such associations do not exist, it may still be possible to
obtain useful information from the Business Registry, banks
and investment institutions.

Management consultants, the good ones, are management

partners. Where they are used, the cost of the work can be
returned to the user many fold.

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3.3 POSSIBLE AREAS OF CONSULTANCY
Enterprises will find consultants readily useful in the following
areas:

1. UNION NEGOTIATIONS:
There is no better judge than the man who is looked upon
as natural to a dispute. A management consultant will
fade out of business if he cannot prove himself as an
impartial judge. Most good consultants know this and
capable of winning the respect of management and
workers as a judge.
It pays to engage them on union negotiations.

2. MARKET INTELLIGENCE:
The greatest asset a consultant has is his knowledge of
sources of facts.

3. PRODUCTIVITY IMPROVEMENT:
Techniques are his stock in trade : Job evaluation, job
enrichment, work measurement, attitude control and incentive
schemes are some of the well known tools a trained and
experienced consultant will use in motivating people to greater
productivity. Workers become suspicious when the same tools
are used by internal management personnel in introducing work

24
 changes. Used by external consultants, the same tools often
meet with acceptance.

4. STOCK CONTROL :
Installation of dependable inventory control measures is often a
complicated exercise. Line managers will never find the time
needed to accomplish such tasks. It is not worth while
employing permanent staff specialists for special projects of a
temporary nature. Call in the external consultant and pay him
off once the assignment is completed.

5. MARKETING
Marketing research, image research, attitude sampling outlet
surveys, test of advertising effectiveness, sales cost appraisals,
etc are short term projects that are best accomplished by use or
consultants.

6. MANAGEMENT INFORMATION SYTEM:

A well trained and experienced consultant will install a
dependable management information system in a matter of few
months. Management control is incomplete without an effective
information system.

7. RECRUITMENT:
Consultants will save management time and the attendant
costs over such issues as executive search, testing,
arrangement of interviews and securing of reliable references
on new recruits.

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8. TRAINING:
A consultant is not successful unless and until he has been
able to transfer knowledge, skill and techniques to the non
expert. If he is successful, he is a good trainer. Use them on
training assignments. Some of them may be willing to run in
plant training sessions that save for the enterprise the
enormous accommodation and traveling costs that would have
arisen if trainees were to participate in external courses.

9. WORK SIMPLIFICATION:
Get the consultant to chat with your people and you will find
that he comes back to you with a list of things to do to cut your
costs and increase your profits.

10. OPERATIONS PLANNING:

Each functional area within an enterprise (Production, Sales,
Buying, Distribution and Services) will usually be engaged in
planning work. Conflicts, departmental walls, duplication of
efforts and the attendant waste in time, money and manpower
will be avoided or minimized by the introduction of an integrated
planning system that coordinates all the planning efforts within
the enterprise. The installation of such a system and the
requisite planning aids is a short term task that is best handled
using a management consultant with the necessary expertise
and experience in grassroots planning.

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11. STRATEGIC PLANNING
Change in operating circumstances, technological advance,
changes in the size and fortunes of an enterprise will have
important consequences to the strategies of the enterprise.
These changes may affect the profitability of an enterprise as
they may also create new opportunities for the enterprise.
Consultants will be found to be useful in handling the complex
analytical routines that are necessary for establishing the
strengths and weaknesses of the enterprise in the new
situations.

3.4. PERFORMANCE CONSULTING

In the words of Marc Rosenberg (1990-1991, President,
National society for performance and Instruction), he aptly
remarks that, “Remember training is not what is ultimately
important ………. Performance is”.

A lot of money had been expended on training especially in the

developed industrial economies of the world.

Consider these facts:

• In North America in 1994, more than $50 billion was
spent on
formal training and development of employees. These are
direct costs only; if the cost of having employees attend
training off the job is added into the equation, the figure
rises to more than $300 billion

27
• To remain competitive in today’s world, organizations
must have a highly skilled, adaptive, and motivated work
force. There must be a return for the investment made
in training
• Can the average only 10 to 20 percent of training
transfers to the
job so that the performance of the employee has been
changed (Brond and Newstrom, 1992 P7).

Unfortunate, what we in the human resources development

(HRD) field have been doing for many years is not working, if
“working” is defined as changing human performance.
As Gloria A. Regalbuto (1992. p.31) has observed :
“organizations do not ask as to deliver what they need; they ask
us to deliver what they believe we can provide --.
And what we are asked to provide – training – is often
ineffective, unnecessary, and expensive.
Occasionally it is even harmful we do just what we are asked to
do – delivering training. We do not do what we are not asked to
do – improve human performance in the workplace.

It is therefore important to transit from the role of traditional

trainer to the role of performance consultant in this regard, one
should be held responsible for the delivery of training
programmes to a responsibility that focuses on changing
human performance and having an impact on the organization.
There must be a programmed change: being viewed as “just a

28
 trainer to being valued as a partner to management in the
achievement of performance and business needs.

Performance consulting centres on the following

* Identify performance requirements that are directly linked to
the operational and business goals of an organization.
* Contract with management to take all the actions that are
needed if the identified performance is to be
successfully implemented
* Work in a consultative manner with critical people so that
you become a valued business partner.
* Move from focusing on delivery of training services to be
focusing on performance.

Performance consulting rests on using a rigorous approach of a

systems engineer to analyze design programmes that change or
improve human performance. It is also hinted that the work
environment within which employees operate has a tremendous
impact upon their job output.

The majority of human resource executives who were interviewed

explained the primary reason for a lack of performance results from
human resources initiatives to be “a failure to lack of human
performance systematically to involve all aspects of the organization,
and then to apply comprehensive solutions to performance
problems”.

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The challenges of performance consulting can be summed up this
way :
1. The competitive advantage, and perhaps the survival of an
organisation demands that employees perform at a high level.
2. Traditional training approaches in support of performance
change are not working, primarily . because they are not
system – oriented in their approach to resolving performance
problems – this despite the fact that significant leaders in the
field have been writing about performance approaches for over
thirty five years.

Conclusively, for those in the training and development field at

this time, management and others will seek out those people
who can partner with them to install the performance required
by the organisation.

Those who work effectively in the future must be able to :

• Develop collaborative working relationships with key
managers and other partners
• Clearly understand the vision and strategies that
management is striving to achieve
• Identify the performance required of employees if the
organisation is to thrive.
• Determine the conditions in the work of environment
that must be modified if needed performance is to take
root.

30
 • Work with people in and out of management to
determine all the interventions required if high
performance is to be achieved.
• Clearly, these activities are outside those of the
traditional training processes.
• We must evolve from a training to a performance
perspective. If we do not rise to the occasion now,
others will. We will have missed an opportunity to be
viewed as a value – added partner and will risk being
seen as peripheral to the mainstream of the business.
• The time is now! Opportunities wait for no one.
Performance consulting is the process by which we can
work with management and others to identify and
achieve performance excellent linked to business goals.
• The message is from now on is : Think performance,
not training !!!

3.5 What is Human Capital Development?

Human resource management policies and practices may be
adopted to deliberately instigate career and human capital
development.

Human capital development can be defined according to Bantis

et al (1999) : “Human capital represents the human factors in
the organisation; the combined intelligence, skills and expertise
that gives the organization its distinctive character. The human
elements of the organization are those that are capable of
learning, changing, innovating and providing the creative thrust

31
 which if properly motivated can ensure that long-term survival of
the organization.

The term ‘human capital’ was originated by Schutt3 (1961), who

elaborated his concept in 1981 as follows:
“Consider all human abilities to be either innate or acquired.
Attributes … which are valuable and can be augmented by
appropriate investment will be human capital.

Human capital is the most important element in an

organization’s intellectual capital, as defined below

3.5.1 INTELLECTUAL CAPITAL

It consists of the stocks and flows of knowledge available to an
organization. These can be regarded as intangible resources
which, together with tangible resources (money and physical
assets), comprise the market or total value of a business.

The three elements of intellectual capital are:

• Human capital (as earlier defined)
• Social capital: the stocks and flows of knowledge
derived from networks of relationship within and outside
the organizations. The concept of social capital has
been defined by Putman (1996)as ‘the features of social
life – networks, norms and trust – that enable
participants to act together more effectively to pursue
shared objectives.

32
 The world Bank defines it as “social capital which refers
to the institutions, relationships and norms that shape
the quality of a society’s social interactions…… social
capital is not just the sum of the institutions which
underpin a society – it is the glue that holds them
together

• Organizational capital
Youndt (2000) defines this as the institutionalized
knowledge possessed by an organization, which is
stored in databases, manuals and so on. This is often
called structural capital (Edvinson and Malone, 1997),
but the term organizational capital is preferred by
Youndt because he argues, it conveys more clearly that
this is the knowledge that the organization actually
owns.

This tripartite concept of intellectual capital indicates that, while

it is individuals who generate, retain and use knowledge
(human capital), this knowledge is enhanced by the interactions
between them (social capital) to generate the institutionalized
knowledge possessed by an organization (organizational
capital)

It is necessary to capture individual knowledge through

knowledge management processes, but it is equally important
to take into account social capital considerations, that is, the

33
 ways in which knowledge is developed through interaction
between people.

Bontis et al (1999) point out that flows as well as stocks matter.

Intellectual capital develops and changes over time, and a
significant part is played in these processes by people acting
together.

3.5.2 THE SIGNIFICANCE OF HUMAN CAPITAL

The focus is on the means of attracting, retaining , developing
and maintaining the human capital they represent because it is
the knowledge, skills and abilities of individuals that cerate
value.
(Davenport)

It is severally commented that ‘people posses innate abilities,

behaviours and personal energy and these element make up
the human capital they bring to their work.
And it is they, not their employers, who own this capital and
decide when, how and where they will contribute it.

In other words, they can make choices.

Work is a two-way exchange of value, not a one – way
exploitation of an asset by its owner”

The point emphasized by Davenport, that workers as well as

employers invest in human capital, is in accord with the

34
economic theory of human capital. Human capital theory
conceptualizes workers as embodying a set of skills which can
be “rented out” to employers.

The expected returns on human capital investments for the

worker, are a higher level of earnings, greater job satisfaction,
better career prospects, and at one time, but less so now, a
belief that security in employment is assumed.

Investment by workers in developing transferable skills can be

attractive as means of increasing employability. The costs of
such investments take a psychological social and monetary
form, as spelt out by Elliot (1991)
- Psychological costs are those borne by individuals,
perhaps the less able, who may find learning difficult.
- Social costs take the form of foregone market
opportunities (opportunity costs – the time spent devoted
to investing in human capital could have been spent in
other activities).
- Monetary costs include both direct financial outlays and
foregone market opportunities
- The decision to acquired skills is an investment decision.
- Individuals will invest in human capital if they believe that
the benefits to them will exceed the costs they will incur.
- These benefits consist of the net addition to lifelong
earnings that results from selling skilled rather than
unskilled labour.

35
 - For the employer, the returns on investment in human
capital are expected to be improvements in performance,
productivity, flexibility and the capacity to innovate that
should result from enlarging the skill base and increasing
levels of knowledge and competence.

“The general message is persuasive : skills, knowledge and

competencies are key factors in determining whether
organizations and nations will prosper” as suggested by
Schuller (2000)

3.5.3 AN INSIGHT INTO HUMAN CAPITAL THEORY

Human capital theory can be associated with the resource
based view of the firm as developed by Barney (1991) This
proposes that sustainable competitive advantage is attained
when the firm has a human resources pool that cannot be
imitated or substituted by its rivals.
Boxall (1996) refers to this situation as one that confers “human
capital advantage’. But he also notes (1996 and 1999) that a
distribution should be made between “human capital
advantage” and “human process advantage”.
- The former results from employing people with
competitive valuable knowledge and skills, much of it
tacit.
- The latter, however, follows from the establishment of
‘difficult to imitate, highly evolved processes within the
firm, such as cross-departmental cooperation and

36
 executive development. Accordingly “ human resource
advantage”, the superiority of one firms labour
management over another’s, can be thought of as the
product of its human capital and human process
advantage

3.5.4 WORKERS AS ASSETS :

The added value that people can contribute to an organization
is emphasized by human capital theory. It regards people as
assets, and stresses that investment by organizations in people
will generate worthwhile returns. The theory therefore underpins
the philosophy of human resources management which, as
developed in the 1980s, stated that employees should be
treated as assets rather than costs.

3.5.5 ITS LIMITATION:

But as Davenport (1999) maintains, the concept is limited,
indeed questionable, because
• Workers should not be treated as passive assets to be
bought, sold and replaced at the whim of their owners.
- Increasingly, they actively control their own working
lives
The notion that companies own human assets as
they own machines is unacceptable in principle and
inapplicable in practice

37
 - It short-changes people by placing them in the
same category as plant and equipment
• No system of ‘human accounting’ has succeeded in
producing a convincing method of attaching financial
values to human resources; in any case, this demeans
the more intangible added value that can be delivered to
organizations by people.

It should be emphasized that employers need to remember that

workers, especially knowledge workers, may regard themselves
as free agents who can choose how and where they invest their
talents, time and energy.

Investments by employers in training and developing people

are a means of attracting and retaining human capital as well
as getting better returns from those investments. This position
governs the role of management consultants, to a large extent,
in human capital development of any nation.

3.6 HUMAN CAPITAL AND OTHER ASPECTS OF

INTELLECTUAL CAPITAL THEORY

As important as human capital theory might be, interest in it

should not divert attention from the other aspects of intellectual
capital – social and organizational capital – which are

38
concerned with developing and embedding the knowledge
possesses by the human capital of an organization.

Schuller (2000) hints that “The focus on human capital as an

individual attribute may lead – arguably has already led – to a
very unbalanced emphasis on the acquisition by individuals of
skills and competencies which ignores the way in which such
knowledge is embedded in a complex web of social
relationships.
Measuring human capital has led to different views which may
not attract us in this paper. There is a good case for evolving
methods of valuing human capital and how it it used as an aid
to decision making. This may mean identifying the key HR
drivers and modeling the effect of varying them. The issue is to
develop a framework within which reliable information can be
collected and analyzed.

However, the significance of the concept of human capital does

not depend on the ability to quantity its value. What human
capital theory can do is to provide the rationale for a ‘resource
capability’ approach to strategic HRM, as advocated by
Kamoche (1996) which will be concerned with the acquisition,
development and retention of human capital in order to achieve
competitive advantage.

At this junction, we may need to note the practical implications

of human capital theory.

39
It focuses attention on
1. Resourcing : Resourcing strategies are concerned with
matching human capital resources to the strategic and
operational needs of the organization, and ensuring the
effective utilization of those resources
2. HRD Strategies – Human resource development
strategies are business – led in that they are initiated by
the strategic plans of the organization and driven by the
human resources plans which define knowledge, skills
and competency requirements.
It aims to attract and retain human capital as well as
develop it
3. Reward strategies :
The implication of human capital theory, from a financial
reward point of view, is that investment in people adds to
their value to the firm.
Individuals expect a return on their own investment, and
have firms to recognize that the increased value of their
employees should be rewarded.
Human capital theory encourages the use of skill based
or competence based pay, a method of reward. It also
underpins the concept of individual market worth. This
indicates that individuals have their own value in the
marketplace, which they acquire and increase through
investments by their employer and themselves in gaining
extra expertise and competence by means of training,
development and experience.

40
 The market worth of an individual may be considerably
higher that the market rate of their jobs, and if they are
not rewarded accordingly they may market their talents
elsewhere.

Non-financial reward considerations should also be taken

into account. If workers are investing their human capital
they want to obtain a return not only in the form of
opportunities to grow and to achieve, but also in terms of
being valued by their employer.

Organizations need therefore to consider how to

recognize accomplishments through performance
management processes and formal recognition schemes
4. knowledge management
Organizational effectiveness depend upon making good
use of knowledge, which needs to be developed,
captured and exchanged (knowledge management) in
order to create
organizational capital. In doing so, it should be
remembered that as stated by Daft and Weick (1984), ‘
individual’s come and go, but organizations preserve
knowledge over time’ or as expressed more colourfully by
Fits-enj (2000) , ‘organizational capital (knowledge) stays
behind when the employee leaves; human capital is the
intellectual asset that goes home every night with the
employee’.

41
3.7 REFERENCES :
Fajana, Sola (2002) Human Resource Management An
Introduction, Lagos. Labofin and company.

Robinson D.G and Robinson J.C (195) Performance

Consulting, Moving Beyond Training, Sam Francisco, Beret –
Koehler Publishers
.
Muyiwa – Oni, R.A (2007) Employee Training and Development
Practices in the Banking Industry (A case study of United Bank
for Africa Plc). Unpublished MBA, (LASU) dissertation.

Armstrong, Michael (1997) Human Resource Management

Practice, Va. Kogan Page Ltd

42
 CHAPTER FOUR

HUMAN CAPITAL DEVELOPMENT AND TERRY KENDALL

Consult Ltd : Problems and Prospects.

“The prosperity of a country lies not on the abundance of its

public buildings, nor on the strength of its military forces
but in the number of its cultivated citizens, in its men of
education, enlightenment and character”
Martin Luther
4.1 THE SYNOPSIS : Human Capital Development and the
Consultant
With our perspective on the key concepts and an insight into
human capital development, the role of any management
consultant is defined by the following factors:
1. The state and level of industrialization, entrepreneurship
awareness and education in any economy
2. The rate of growth of the economy and the capacity
utilization ratio.
3. The consciousness on the part of the organization
(employers) and employees (individuals) to train, develop,
and retain the staff on a strategic basis and be goal driven
and self – fulfilled.
4. The challenges posed by globalization, competitiveness and
intercommunication trainings.
5. The performance management scheme and the reward
systems; and

43
6. Finally the government/industrial infrastructural frameworks
to create a conducive working environment.

The role of a training/performance consultant in particular and that

of management consultant in general can be appreciated when the
governments place emphasis on human capital development in
collaboration with other agents of economic growth and socio-
economic development. These are:
1. The institutional frameworks
2. Policy changes and relevance
3. Human capital development
4. Culture
5. Leadership and
6. Entrepreneurship

The fundamental issue: How do they train, develop and retain the
manpower? Is the human capital developed substantially by both
the private and public sectors in addition to individual’s awareness
and commitment to develop portable and transferable skills and
competencies? Is the human capital development nourished and
supported by good health care schemes?
Are the manpower not being ravaged by HIV/AIDS and accidents
on our roads for non or inadequate maintenance. Are the
leadership both at the industrial sector and at Federal, State and
Local governments responsive to and effectively managing
change? Are the resources not been deliberately wasted by
inadequate planning and unstructured growth in the tertiary
institutions thereby promoting a wide – scale unemployment apart

44
 from apparent under-employment in virtually all sectors of the
economy?
These are the critical challenges apart from poor industrial and
social infrastructures, corruption and mismanagement here and
there.

4.2 THE EDUCATION SECTOR AND TRAINING AND

DEVELOPMENT.
The educational sector does not attract adequate and proper
attention it should obtain. The budget allocation is grossly
inadequate apart from mismanagement of budgetary provisions.
One can not effectively claim that the educational sector is well
planned to address the issues of national, sectorial and industrial
needs from year to year. Manpower planning has not been able to
address critical issues of optimal utilization of manpower resources
in most of developing or more appropriately les-developed nations
including Nigeria.

The importance of training and performance management has not

attracted the attention of the governments as well as the private
sector. Only few foreign-based or turned organization do not pay
lip service to human capital development and the growing financial
sector.

There have been a lot of problems faced by the management

consulting outfits. Some of the problems are :

45
1. Poorly qualified and/or unqualified and unprofessional
“management consultants’ with no input to make in
performance enhancement challenges/tasks
2. Inadequate training by the would be consultants]
3. Inadequate training infrastructure in addition to poor reading
culture
4. They emphasis more of training than embarking on
performance consulting.
5. Brickwalls often erected against new consultants who want to
win new clients and extend effective training and manpower
development strategies.
6. Corruption and unethical practices which do not expose
consultants to competition and challenges. In not companies
and government establishments, their cronies are used as
consultants which in most cases can hardly deliver.
7. The consciousness that every retrenched employees and
unemployed graduates/Nigerians brand themselves as
consultants’. And a host of other factors.

TERRY KENDALL Consult Ltd in a concerted effort to contribute

positively to the growth of the human capital development has
been variously engaged as training/performance consulting
consultants to both private and public sectors of the Nigerian
economy. The added focus of the establishment Terry Kendall
Leadership Academy is to train and equip Nigerians with sound
and life-challenging transformational leadership and
entrepreneurship skills and competencies. The campaign is on; we

46
are challenged through Ralph Maxwell Consulting to embark on
training, project management and HR services.
Our recent launching of The 21st Century Effective Manpower is a
step in the right direction to publish management Journals on
quarterly basis and also produce revision packs for undergraduate,
postgraduate students and teeming population of working
managers/supervisors and the unemployed youths. This is
purposed to positively influence the level of management literacy
and eventual growth of the human capital formation/development.

This is challenging; but with a total commitment and dedication’ we

can effectively influence the sustained growth of the human capital
if other colleagues join hands to lift Nigeria up. With a spirit of
commitment and nationalism, we shall be there!

For any professional consultant to make a worthwhile contribution

to the development of the nation human capitals, there is need for
continuous learning and updating of knowledge, skills and
techniques that are fundamental, portable and transferable to the
trainees and organizations from time to time. Adequate knowledge
of KT is a sine qua non for effective consulting and management.
There is also an ever increasing need to partnership with the
tertiary institutions, the private and the public sectors of the
economy.

As a mater of utmost urgency, there must be an increasing

awareness, application and development of sound and
performance – driven management systems. And functional

47
 human resource planning that determines the human resources
required by the organization to achieve its strategic goals must be
in place to take care of the immediate, short-term and long-term
needs of the organizations.

In this perspective, there must a concentrated programme on

productivity enhancement through attitudinal change and the need
for personal development and transformations. The effect of 1+1
=3 principle of multiplier should be brought to bear on the
management process. And more importantly, the culture and
climate of the organizations/business should be conducive,
challenging and investment receptive.

Terry Kendall group can only contribute positively and effectively

to grow the human capital formation/development in cooperation
and conjunction with other consulting firms, the private and the
public sectors as well as the avowed interests of working
population and in fact every individuals with fervent commitment to
add – value to lives and workplace responsibilities and tasks

4.3 THE PROSPECTS AND CHALLENGES

No nation attains a sustained economic growth and socio-
economic development without adequate planning and strategic
orientation matter is neither created non destroyed, every object
remains a in a state of nature until a force is applied to it.
The economic manpower should be tasked to plan and plan
effectively and harness al the economic resources to the benefits

48
of her citizens. Every Nigerian should be challenged to rededicate
himself/herself to render the best of services and continually
improve its contribution to the concept of productivity and value
creation and management.

The industrial and socio-economic infrastructures such as energy

which now assumes an important factor as an agent of production,
spirit of nationalism, good business ethics and value systems and
opportunities to grow and be creative as entrepreneurs should be
put in place. The educational system should be revitalized and
planned so that the amount required in specific sectors are
produced on a strategic basis.

Management education should be emphasized and functional and

heavily subsidized health care services should be put in place.
There are prospects. There are no underdeveloped countries, we
only have under managed or mismanaged nations. Management
is the prime mover and development is the consequence of
effective management

The application and constant training and retaining of staff in the

financial sector of the nation has prompted good and result –
oriented management practices. This has positively impacted on
their operational performances, attitudinal change and
development of characters that attract value added appreciation.
Most of the thriving organizations in Nigeria particularly in the oil
sector and foreign – based organizations apply good and effective
management practices with emphasis on strategic management,

49
transformational leadership and performance consulting and
management.

50
4.4 REFERENCES
Oladimeji Alo (2000) Managing the Human Capital for
National Development, Institute of Personnel Management,
Anmal Lecture, Mouson Centre

Ray Killean, (1976) Human Resource Management: An ROI

Approach, AMACOM ; A Division of American Management 74
Association p8

Armstrong Micheal (2005) Human Resource Management

Practice, VA Kogan Page Limited

Muyiwa – Oni, R.A (2007) Employee Training and Development

Practices in the Banking Industry: (A case study of United Bank
for Africa Plc) Unpublished MBA – (LASU) dissertation.

Nwachukwu, CC (2005) Management Theory and Practice,

Onisha, Africana FEP Publishers Ltd

Obisi C (2003) Organizational Behaviour – Concepts and

Applications, Lagos, Matt House Press Limited

Muyiwa – Oni, R.A (2008) An overview of ‘Improving your

Operational Performances’ A seminar paper delivered to MFM
ministries Battlecry, Tapes & Publication unit on October 29,
2008.

51
 CHAPTER FIVE

SUMMARY OF FINDINGS, CONCLUSIONS AND

RECOMMENDATIONS

“Since we are capable of modifications the future will be in many

ways only as good as we have the courage to make it”
- June Tapp

5.1 SUMMARY OF FINDINGS:

Management involves working with and through people to
accomplish organizational objectives. And the field of management
is the totality of concern with the human resources of
organizations. Management holds the key that unlocks the forces
of economic and social development in any nation. The driving
force behind this is man. And man constitutes the human capital of
any organization or nation.

Human capital development consist of the knowledge, skills and

abilities of the people employed in an organization. It is the human
factor in the organization. It is the most important element in an
organizations intellectual capital and it consists the stocks and
flows of knowledge available to an organization. The value of the
human capital must be continually enhanced and motivated to
ensure its optimal utilization.

52
The management consultant as a professional expert works with
the members of staff of any organization to find out the areas that
need advice, diagnosis and proffering of management solutions.
The consultant is charged and equipped with excellent
professional ethics, skills, attitudes, techniques and what have you
to get the desired results through the cooperation with others in
any organization. In this perspective the consultant, as a training
and performance consultant consulting would enhance the skills,
competencies, attitudes and techniques of the staff with a view to
positively influence and increase the human capital formation of
any organization or nation.

This is achieved by instituting good policies and establishing good

environments and climate that would propel increased productivity:

Investment in human capital is a two-way affair the workers as well

as employers invest in human capital. Investment by workers on
developing transferable skills can be attractive as means of
increasing employability.

It is incontrovertible that for management consultants to positively

influence the stocks and flows of human capital, fundamental
infrastructures must be available, industrial growth and
performance management must be established and more
importantly every emphasis must be placed on developing the
human capital.

53
 In fact, the critical importance of people in the achievement of
organizational objective should be the focus.

5.2 RECOMMENDATIONS :
In view of the foregoing, it is hereby recommended that for a
nation or indeed an organization to enhance its human capital
development through training and manpower development,
education and modern technology, the following issues must be
taken into consideration :
1. There is need for strategic planning and transformational

leadership skills to proactively position itself for competitiveness

and meeting the challenges of the present and the future
2. The management consultants should be continuously trained

and updated to evaluate training objectives and the impact and

relevance of performance consulting and management
3. Both the private and public sectors should use professional

consultants optimally to advice and solve day-to-day

management problems/challenges.
4. The educational system should be well focused and dynamised

to take account of development in human capital management

and developments all over the world as the whole world is now
“global village”. The educational system vis-à-vis the production
of graduates of tertiary institutions should be tailored to the
present and future needs of the organization/nation.
5. The health/medical care services should be adequately funded

so that life expectancy of the people can increase. There is no

point spending a lot of money developing the human capital
only to be ravaged by HIV/AIDS.

54
6. The cultural factors should also attract attention so as to

increase the level of productivity which would stimulate the

gross domestic products as well as the need for consultancy
services.

FINAL NOTE
There should be a functional partnership between the private and
the public sectors to harness the potentials of the people to propel
the human capital development through effective educational
policies, training, performance consulting and creating the
awareness and consciousness to continually improve ourselves
and our performances. Here lies the challenge!

The issue of human capital development is fundamental and every

attempt should be made increase its stocks and flows from one
generation to another. Our commitment to grow and meet the
goals and objectives of organizations or nations is premised on the
development and optimal utilization of human capital.

55
5.3 REFERENCES:
Nicholas Harman, “The most African Country: Nigerian Survey”.
The Economist, Jands’

Oladimeji Alo (2000), Managing the Human Capital for National

Development, Institute of Personnel Management, Annual
Lecture Mouson Centre.

Fredrick H. Harbison (1973) Human Resources as the Wealth

of Nations, New York Oxford University Press p.3

Ray, Killan (1976) Human Resource Management

An ROI Approach, AMACOM. A Division of American
Management Association p8

Aina, Sola, (2005) Managing the Human Capital in Nigeria

Ikeja, Fountain Training Consult.

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57