Knowledge Acquisition in Investment Banking: Opportunities for HR Professionals

By Carol Royal.

Published by The Organization Collection

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Article: Print $US10.00
Article: Electronic $US5.00

In a knowledge economy, it is essential for analysts of listed companies to understand, analyse and systematically articulate the drivers of intangible value within listed firms. This is essential for the process of more transparent investment recommendations. This paper examines current knowledge management practices within two investment banking firms, with a focus on the work of securities analysts, and observes a knowledge gap in the approach of analysts to analysing intangible value creation. In particular, the significant role of human capital as a driver of value in listed firms, is not well understood by securities analysts or their clients, and yet, as the human capital literature (Bassi and McMurrer, 2007; Mayo, 2001) suggest, human capital can be a lead indicator of potential future firm value. This knowledge gap is partly historical, as the professional licencing requirements of securities analysts has not, to date, included specific skill development in the qualitative forms of data analysis required for systematic human capital analysis. This is a component (2000-2005) of a larger study conducted from 1996-2005 in investment banks in Australia, Asia and the UK. The author uses an adaptation of Hodson and Sullivan’s (2002) three phase model of professional knowledge acquisition as a basis for highlighting new organisational development opportunities for HR professionals: bridging the human capital knowledge acquisition gap lobbying regulators to make changes in the training underpinning the licensing of securities analysts; accessing formal university courses in qualitative analysis, using professional associations for non-technical, non-traditional, strategic forms of knowledge acquisition and, finally, creating performance management systems to embed this form of knowledge acquisition into the work of securities analysts.

Keywords: Human Capital Analysis, Human Resource Management, Investment Banking

International Journal of Knowledge, Culture and Change Management, Volume 8, Issue 11, pp.73-84. Article: Print (Spiral Bound). Article: Electronic (PDF File; 877.947KB).

Dr. Carol Royal

Senior Lecturer, Director Masters of Technology Management, Australian School of Business, University of New South Wales, Sydney, NSW, Australia

Dr. Carol Royal (BA, M Com, PhD, UNSW) is the Director of the Masters of Technology management and senior lecturer in the School of Organisation and Management, Australian School of Business, at the University of New South Wales in Sydney, Australia. She was adjunct to the Australian Graduate School of Management and has had many years experience in corporate life as a practitioner in the human resources profession and as a management consultant.

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