Use of practical wisdom through human capital in enhancing organizational innovativeness

In this dynamic global environment only those companies survive who know the power of knowledge and consistently create new knowledge. Such knowledge creating firms utilize dynamic dimensions of human capital. Human capital is the most important resource for a firm and has ability to create new knowledge in a changing environment. Various dimensions of human capital transcend themselves through knowledge creation in spiral knowledge creation process. These dynamic dimensions of human capital create knowledge in firms and foster practical wisdom, called phronesis. In a specific and dynamic context, subjective and objective ideals everyday through the SECI process, create knowledge and it is refined to become wisdom. Same is the case with innovation which emerges from the spiralling continuity of knowledge creation process. This conceptual paper builds on the philosophical concept of phronesis to describe the development and utilization of dynamic human capital to enhance organizational innovativeness. Keyword: Human capital, Knowledge creation, Phronesis, Organizational innovativeness. © 2015 Knowledge Journals. All rights reserved.