Performance evaluation and ranking of organisational units with the human capital management approach using data envelopment analysis: a case study

Abstract

In today’s competitive environment, governmental and private organisation try to gain competitive advantage, so they must regard human capital as an advantage factor to achieve high profit. On the other hand, investment on human capital causes organisation commitment of the employees. The purpose of this study is to present a systematic method for evaluating the efficiency of human capital management (HCM). In this paper, a method for evaluating the performance and ranking of organisational units has been presented with the approach of HCM. Thus, the HCM drivers have been considered as the input and organisational commitment as the output of DEA modal and then in the second step, the levels of each five drivers of HCM and organisational commitment have been identified. In the third step, the CCR model is used to evaluate the unit’s performance. Afterward, the units have been ranked with the use of ideal and anti-ideal solution. Finally, to demonstrate the application of the proposed approach, a case study in Foolad Technic International Engineering Company has been performed. The results of this study suggest that two organisational units of this company were efficient with the approach of HCM.