The Relationship between Human Capital and Jordanian Pharmaceutical Organizations' Business Performance

Purpose: The purpose of the study is to investigate the influence of HC on JPOs' BP.

Methodology: Practical data were collected from 132 out of 200 managers, by means of a questionnaire. Statistical techniques such as descriptive statistics, t-test, ANOVA test, correlation, multiple regressions, stepwise regression, sequential regression, PLS were employed. To confirm the suitability of collected data, a Kolmogorov-Smirnov test, Cronbach’s Alpha and factor analysis were used.

Findings: The results indicated: 1) A positive significant relationship between HC and JPOs’ BP, 2) Respondents believe that “learning & education” and “innovation & creation” variables positively and directly affect the JPOs' BP, while the “experience & expertise” variable does not. 3) HC can clearly explain productivity and profitability more than market valuation.

Limitations/Implications: The use of a single industry study design limits its generalisability to other industries. Testing other industries will help mitigate the issue of generalizing conclusions on other industries.

Practical Implications: The research results might help both academics and practitioners to understand the components of HC. Moreover, the data suggest that a similar set of HC indicators could be developed for other industries.

Expected Value: The research may be considered as initiative study that: 1) Highlights the effect of HC on JPOs' BP; 2) Uses PLS method in the management field.