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Return on Hc Research

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Return on HC

Thing to be implemented for tracking:

* Systems that track hours per project * Performance appraisals-3-4 times a year

Reports: * The Boston Consulting Group report, Creating People Advantage: How to Tackle the Major HR Challenges During the Crisis and Beyond) * Employee Lifetime Value: Measuring the Long-Term Financial Contribution of Employees * http://www.cgma.org/Resources/Reports/DownloadableDocuments/CGMA_launch_report.pdf * http://www.thesocialworkplace.com/2012/03/13/the-measurable-value-of-human-resources/ * http://www.spring.gov.sg/resources/documents/guidebook_productivity_measurement.pdf *

Formulas * Human capital ROI = Revenue - (Operating expense - labour cost) ÷ labour cost * Human capital Value Added = Human capital ROI ÷ number of employees * “So in our metric, you divide personal cost by capital- related costs, such as depreciation, add the cost of capital and multiply by capital employed (for more detail see The Boston Consulting Group report, Creating People Advantage: How to Tackle the Major HR Challenges During the * http://www.bcgperspectives.com/content/articles/organization_transformation_workonomics_more_useful_way_calculate_profit/ - explanation of BCG article * http://www.apex-ps.com/articles/ODHRROI.pdf- New look at HC ROI * http://www.emslieanalytics.eu/downloads/essential_metrics.pdf - high level HR metrics * * * Crisis and Beyond). Most companies, even in the old economy, are involved in people-intensive work and have ratios of 3:1, 4:1 or 5:1 (people cost compared to capital cost), so this clearly indicates value creation is more on the people side than on the capital side.” * Productivity (Employee ROI)- $ spent on labor cost/total revenue * Chart out training hours vs productivity * * He knows of only a few companies, such as Hewlett Packard and Microsoft, which are seriously doing something in this space. “They have some simple formulas like revenue per FTE, and compensation as a percent of revenue,” he says. * However, there is more strategic value in using human capital, analytics such as absence and recruitment rates, grievances, resignation rates and productivity indicators to provide insight…...

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