Moderating effect of motivation in the relationship of intellectual capital and business performance: an evidence on Pakistan textile sector

Abstract

This paper presents a research finding on the relationship between human capital and business performance. The objectives of the study were to examine the relationship between human capital and business performance, especially in the listed textile firms in Pakistan Stock Exchange (PSE). Further, the study determined the contribution of human capital on business performance. The paper examines the most important aspect of human capital that influenced business performance. Data has been collected from the randomly selected 237 senior managers of listed textile firms. Based on data collection, SPSS software 25 was used to obtain the descriptive statistics. To test the reliability and validity measure for the model constructs structural equation model was used. Based on collected data SPSS 25 was used to obtain descriptive analysis. Structure Equation Model (SEM) method was used to examine the reliability and validity measure for the model constructs and Smart PLS 3.2 was used to assess both measurement and structural model. By applying the Structural Equation Model (SEM), the study finds that human capital has significant impact on the business performance. Whereas motivation being moderator diminishes relationship between human capital and business performance. The findings of the study advocated that textile firms should emphasize more on human capital to uphold their business performance. The study contributes to the existing literature of human capital practices where there has been a lack of research works in the context of Pakistan. The use of a single industry study design limits its generalizability for other industries. Testing other industries will provide help to mitigate the issue of generalizing conclusions on other industries. In addition, the research results might also be helped to both the academics and practitioners to understand the human capital components. Moreover, the data also suggested that a similar set of HC indicators could be developed for other industries. Similarly, research might be considered as initiative study which: 1) highlights the effect of HC on ' BP) in the listed textile firms in Pakistan through using PLS method in the management field.

Keywords

• intellectual capital
• motivation
• business performance
• textile industry of pakistan