The Human Capital Edge: 21 People Management Practices Your Company Must Implement (Or Avoid) To Maximize Shareholder Value [Hardcover]

Bruce N. Pfau Phd (Author), Ira T. Kay Phd (Author)

Book Description

Publication Date: December 13, 2001

Global human resources consulting firm Watson Wyatt has conducted a large body of research on 25 human capital management practices showing, for the first time, how these practices can raise or lower the stock price of a company and by how much. This research, cited in the Wall Street Journal, the New York Times, and Forbes, is the foundation of the Human Capital Edge, and brings a new level of financial measurement-based precision to the too-often fuzzy world of management books.

Editorial Reviews

About the Author

Bruce N. Pfau, Ph.D., (New York, NY) and Ira T. Kay, Ph.D., (New York, NY) are senior executives of Watson Wyatt Worldwide, a world-leading human resources consulting firm. Dr. Pfau is Watson Wyatt's national practice director of organization assessment and performance. Dr. Kay is director of the U.S. compensation practice.

Product Details

• Hardcover: 300 pages
• Publisher: McGraw-Hill; 1 edition (December 13, 2001)
• Language: English
• ISBN-10: 0071378839
• ISBN-13: 978-0071378833
• Product Dimensions: 9.1 x 5.9 x 1.4 inches
• Shipping Weight: 1.7 pounds
• Average Customer Review: 4.7 out of 5 stars  See all reviews (7 customer reviews)
• Amazon Best Sellers Rank: #786,064 in Books (See Top 100 in Books)

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Customer Reviews

Most Helpful Customer Reviews

18 of 18 people found the following review helpful:

3.0 out of 5 stars Good numbers, weak advice, April 5, 2002

By A Customer

This review is from: The Human Capital Edge: 21 People Management Practices Your Company Must Implement (Or Avoid) To Maximize Shareholder Value (Hardcover)

This book makes a valuable contribution to the growing body of evidence that human resources practices have a positive influence on business results. It gives solid numbers showing the relationship between 21 human capital practices and market value. It also provides evidence that these practices are a leading indicator of value creation. That's great stuff!

Then things fall apart quickly. The reason is because the authors over-reach by offering their suggestions for implementing the HR practices they identify as creating market value. That scope is simply much too large for a book of this size, resulting in shallow solutions. As an example, the authors show that "linking rewards to performance" is associated with a nine percent higher market value. They then share all of nine pages on how to implement pay-for-performance systems. That's hardly adequate, given there are a multitude of full-length books on that subject alone.

Some vexing findings are given short shrift, like the counterintuitive results that training and 360 degree feedback actually reduce market value. The authors waffle on the findings by suggesting the negative impact can be explained simply because these programs typically are ineffective. That kind of logic doesn't work since executing the other HR practices poorly would also have a negative impact on value creation.

In sum, this book does an excellent job demonstrating the relationship between human capital practices and market value. However, if you need help implementing those practices, you should look elsewhere.

6 of 6 people found the following review helpful:

5.0 out of 5 stars Great Insights, February 17, 2002

By 

Kenneth Traub (Elmsford, NY USA) - See all my reviews

This review is from: The Human Capital Edge: 21 People Management Practices Your Company Must Implement (Or Avoid) To Maximize Shareholder Value (Hardcover)

The Human Capital Edge provides both an interesting and thorough perspective on best practices in human resource management, but more importantly, it translates these principles into specific actions that managers can take to maximize shareholder value.

While it confirms many widely held managerial assumptions with rigorous support and analysis - it also pushes the envelope with new ideas that challenge conventional thinking.

I found this book to be both thought provoking and useful, and recommend it to other CEO's who are seeking to increase shareholder value through better management of their human capital.

Kenneth Traub
President and CEO
American Bank Note Holographics, Inc.

7 of 8 people found the following review helpful:

5.0 out of 5 stars One of the Best Books Ever Written on Strategic HR..., June 20, 2003

By 

Robert G. Barnwell "Robert G. Barnwell" (New York City) - See all my reviews

Amazon Verified Purchase

This review is from: The Human Capital Edge: 21 People Management Practices Your Company Must Implement (Or Avoid) To Maximize Shareholder Value (Hardcover)

The people at Watson Wyatt never stop amazing me. Recently, I purchased a copy of the Gallup Organization's "Follow This Path." Having read it, I was convinced that there was nothing left to say. Wrong. Pfau and Kay have written an amazing book that documents the correlation between Strategic HR practices and Shareholder Value growth. Well done. One reviewer complains that the book isn't comprehensive enough. I'm not sure this is a fair critisism. After all, the book details 21 HR practices and their impact on TSR (Total Shareholder Return). Certainly, one book cannot possibly provide a comprehensive treatment of all 21 HR practices. However, since when has any professional relied upon a single business book in any subject as their sole resource? This is a fantastic book. I strongly recommend that any senior executive (including CEO, COO, and board memebers) pick up a copy. I also recommend "Follow this Path," Gubman's "The Talent Solution," Risher's "Aligning Pay and Results," and Lawler's "Treat People Right." Overall grade: AAA+++