Abstract
<p>Many studies indicate a positive correlation between human capital and operating performances for professional service providers. This paper takes a step further and explores the impact of demographic profiles on financial performances, given the lack of research on this front in Taiwan. To clarify the relationship between these factors, this paper takes a resources-based view in the examination of the influence of human capital and demographic profile on operating performances. Sample is sourced from “Survey of CPA Firms in Taiwan” issued by the Financial Supervisory Commission in 1999-2012. The empirical results suggest that (1) the greater the human capital, the better the organizational performances; (2) the higher the heterogeneity of educational backgrounds in the demographic mix, the better the organizational performances; (3) the heterogeneity in age in terms of the interaction between human capital and demographic profiles has a positive effect on organizational performances.</p>
Highlights
To response to the intensifying competition in the marketplace due to globalization, companies resort to reorganizations, downsizing, reengineering, outsourcing or relocating facilities to other countries
CPA firms are a knowledge-based and labour-intensive service provider typically seen in the knowledge economy
There is no definite conclusion regarding whether the demographic mix of the workforce in professional service providers affect their financial performances
Summary
To response to the intensifying competition in the marketplace due to globalization, companies resort to reorganizations, downsizing, reengineering, outsourcing or relocating facilities to other countries All these measures are increasing the diversity of the demographic profile of organizational members (Richard and Jeffrey, 2000). It is important to effectively manage the issues associated with the heterogeneity of demographic profiles, in particular when it comes to the effects of human behavior within an organization. This is because such issues are critical to the continued growth of an organization. It goes without saying that demographic diversity is a major issue in organizational management
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