ISBN-10:
0134431812
ISBN-13:
9780134431819
Pub. Date:
10/08/2015
Publisher:
FT Press
Investing in People: Financial Impact of Human Resource Initiatives / Edition 2

Investing in People: Financial Impact of Human Resource Initiatives / Edition 2

by Wayne Cascio, John Boudreau
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Product Details

ISBN-13: 9780134431819
Publisher: FT Press
Publication date: 10/08/2015
Edition description: New Edition
Pages: 384
Sales rank: 378,761
Product dimensions: 7.00(w) x 9.00(h) x 0.90(d)

About the Author

Wayne Cascio holds the Robert H. Reynolds Chair in Global Leadership at the University of Colorado Denver. He has authored more than 150 journal articles and book chapters and 24 books. In 1999 he received the Distinguished Career award from the HR Division of the Academy of Management. He received an honorary doctorate from the University of Geneva (Switzerland) in 2004, and in 2008 he was named by the Journal of Management as one of the most influential scholars in management in the past 25 years. In 2010 he received the Michael R. Losey Human Resources Research Award from the Society for Human Resource Management. His work is cited regularly in the business press. Dr. Cascio is a Fellow of the National Academy of Human Resources, the Academy of Management, and the American Psychological Association. Currently he serves as a senior editor of the Journal of World Business .

John Boudreau is Research Director at the Center for Effective Organizations and Professor of Management and Organization in the Marshall School of Business at the University of Southern California. He is recognized worldwide for breakthrough research on the bridge between superior human capital, talent, and sustainable competitive advantage. He is a strategy, human resource management, and talent advisor and educator in organizations ranging from early-stage companies, to government agencies and Fortune 100 organizations, to large multinational companies. Dr. Boudreau has published more than 60 books and articles, and his work has been featured in Harvard Business Review , The Wall Street Journal , and Business Week . He has won scholarly awards from the Academy of Management. Dr. Boudreau is a fellow of the National Academy of Human Resources and was formerly a professor at Cornell University.

Read an Excerpt

Preface

The demand for accountability among all business functions has never been greater. A key responsibility of human resource (HR) leaders and consultants is to articulate the logical connections between progressive HR practices and firm performance, and they need to demonstrate those connections with data. This book provides logic and technology to look inside the "black box" between HR practices and financial/business performance.

We argue that investing in talent should be as systematic as investing in any other vital resource, based on logical frameworks and focused on optimization rather than simply cost reduction or mimicking best practices. This argues against the common "peanutbutter" approach to talent investments that spreads the same investments (for example, in training or staffing programs) over the entire organization, in an effort to be fair by being equal. Such approaches engender justifiable skepticism from leaders and employees who are asked to invest in programs or activities because HR—or even the CEO—says that "everyone must do it." That approach is in stark contrast to other resources, such as customers and technology, where investments are targeted where they have the greatest effect. Why not make greater talent investments where they matter most and smaller investments where they do not make a significant strategic difference? This "decision-science" approach provides the foundation for the techniques we present here. We emphasize that ultimately measurement is valuable when it improves important decisions about talent. That requires not simply more or better measures, but an integrated approach that combines those measures with logic, analytics, and knowledge processes (what we call the LAMP framework). Each chapter begins with a logic diagram that shows the links between particular HR programs, employee behaviors, and operational and financial outcomes. Each chapter includes a discussion about process, describing opportunities and effective ways to communicate results to decision makers.

We draw extensively on our decades of experience assisting senior-level decision makers to better understand and measure the impact of talent decisions, and also on our scholarly research on the connections between talent and organizational outcomes. We have been fortunate to work with both practicing leaders and academic researchers. This combination is essential for talent measurement and decisions that achieve both practical relevance and logical rigor.

Investing in People draws upon research in psychology, economics, accounting, and finance to provide tools that leaders inside and outside the HR profession can use together to describe the financial results of their investments in people. We focus on HR investments with a rich history of data-based research, including staffing, training, workplace health, employee attitudes, and employee turnover, which also represent some of the most important strategic HR functions.

This book provides specific formulas and calculations that you can use to evaluate the impact of your own talent decisions. To make the formulas easier to use, we developed software to accompany the chapters on the following topics: absenteeism, turnover, health and welfare, attitudes and engagement, work-life issues, external employee sourcing, the economic value of job performance, payoffs from selection, and payoffs from training and development.

The Society for Human Resource Management (SHRM) provided generous support for the development of the software, and you can access this software at the SHRM website (http://www.shrm.org), regardless of whether you are a SHRM member or not. The software performs the calculations of measures, so that readers can focus on the logic, analytics, and processes necessary to improve strategic decisions about talent.

Business leaders, inside and outside of the HR profession, need more rigorous, logical, and principles-based frameworks to understand the connections between human capital and organizational success. We hope that this book serves as a "go-to" resource for those frameworks.

© Copyright Pearson Education. All rights reserved.

Table of Contents

Acknowledgments xiv

About the Authors xv

Preface xvi

Chapter 1: Making HR Measurement Strategic 1

Chapter 2: Analytical Foundations of HR Measurement 19

Chapter 3: The Hidden Costs of Absenteeism 51

Chapter 4: The High Cost of Employee Separations 79

Chapter 5: Employee Health, Wellness, and Welfare 115

Chapter 6: Employee Attitudes and Engagement 143

Chapter 7: Financial Effects of Work-Life Programs 169

Chapter 8: Staffing Utility: The Concept and Its Measurement 195

Chapter 9: The Economic Value of Job Performance 223

Chapter 10: The Payoff from Enhanced Selection 255

Chapter 11: Costs and Benefits of HR Development Programs 283

Chapter 12: Talent-Investment Analysis: Catalyst for Change 309

Appendix A: The Taylor-Russell Tables 325

Appendix B: The Naylor-Shine Table for Determining the Increase in Mean Criterion Score Obtained by Using a Selection Device 337

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