Developing Intellectual Capital in Professional Service Firms Using High Performance Work Practices as Toolkit

Abstract

The role of Professional Service Firms (PSFs) has always been crucial in the development of knowledge economies. The effectiveness of these firms is highly attributed to the knowledge capabilities and skills embedded in its human resources and how effectively these resources are utilized in the optimal benefit of the firm. Owing to the ever-increasing growth of the services sector globally, it’s critical for the PSFs to gain in-depth awareness on the application of High-Performance-Work-Practices (HPWPs) so as to continually maintain quality of their services to the clients. However, the mechanism for systematically managing and implementing these practices in intellectual capital context is still not fully developed. This research, therefore, theoretically investigates and suggests a linkage mechanism on how Strategic HR practices (HPWPs) via (Ability, Motivation and Opportunity)-enhancing bundles stimulate intellectual capital development in professional service firms. By presenting a conceptual framework, this study offers practically meaningful insights to the managers in the service firms on how to implement these practices for effectively meeting client needs and sustaining a competitive advantage.