UNDERSTANDING THE EFFECT OF HUMAN CAPITAL MANAGEMENT PRACTICES, PSYCHOLOGICAL CAPITAL, AND EMPLOYEE ENGAGEMENT TO EMPLOYEE PERFORMANCES

• Main Author: Witasari, Jessica
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/49331
• Institution: Institut Teknologi Bandung

As the main factor of creative business, creative and innovative individuals are indispensable in addressing the complexities of the dynamic business environment. Knowledge, expertise, abilities, character, capabilities, and determination are valuable elements of human capital for business competency. Therefore, human capital specification, flexibility, and precise applications are notably important during the talent acquisition process, especially in a creative industry like architecture. Additionally, human capital's importance guides the business unit to concern with precise human capital management practices, employee engagement, and psychological capital as preventive solutions to improve employee performance. However, the study whereby these variables are connected remains insufficient. Accordingly, this study aims to discover: (1) the relation between human capital management practices, psychological capital, employee engagement, and employee performance; and (2) the direct and indirect impacts among the variables with their significance. A questionnaire was employed for the data collection process, further analysed utilizing structural equation modelling by Smart PLS to examine the relationship between the variables. The results show that employee engagement does not significantly impact employee performances, while psychological capital does. Human capital management practices directly impact employee engagement and psychological capital. Nonetheless, it should be mediated by psychological capital to ensure employee performance. For the contribution, this study provides empirical information upon the crucial elements of psychological capital for human capital and employee performance study literature.