I think this is an important book for HR management. The authors show the way of moving from the odd notions of how well HR delivers its services to demonstrating hard number measurements of HR value added to the performance of the company. After presenting their argument for making HR Management as strategic as Finance and Marketing, they show you how to become more analytical in your approach to HRM.
They then go through ten subjects showing you how to analyze the financial impact of that topic and then offer you a case study to work through using the tools you were given in that chapter. Then ten topics are:
1) The Hidden Costs of Absenteeism
2) The High Cost of Employee Separations
3) Employee Health, Wellness, and Welfare
4) Employee Attitudes and Engagement
5) Financial Effects of Work-Life Programs
6) Staffing Utility - Concept and Measurement
7) The Economic Value of Job Performance
8) The Payoff from Enhanced Selection (hiring better people using tools)
9) Costs and Benefits of HR Development Programs
10) Talent-Investment Analysis: Catalyst for Change
I found this book to be smart, on point, easy to understand, and think it will be of real use to anyone serious about becoming more analytical about the HR Management function.
Reviewed by Craig Matteson, Ann Arbor, MI
on September 29, 2011
A key responsibility of human resource 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, according to Wayne Cascio and John Boudreau in this book. The book suggests a number of analytical techniques which can be used to provide the necessary data to answer such questions as:
* What is the actual cost to the business of employee absenteeism?
* How much do employee separations cost the business in terms of lost productivity?
* What is the cost-benefit ratio of an employee health and wellness initiative?
* How can a business measure the financial impact of employee attitudes?
* How can the outcomes of a work-life program be analysed and measured?
* What are the costs and benefits of employee recruitment and selection efforts?
* What are the costs and benefits of training and development programs?
In my view the authors make a convincing case for the importance of gathering data to provide a quantitative estimate of the effects of various HR initiatives. However many of the recommended analyses involve complex statistical calculations based on highly subjective (and therefore imprecise) data, and the results are likely to be unreliable if the underlying data is unreliable. This does not mean that measurements should not be attempted, but it does mean that simple analysis may be sufficient and the degree of data reliability should always be kept in mind. The particular analytical techniques recommended by the authors are probably more useful for very large organisations (with large sample sizes) than for smaller ones.
Exercises are provided at the end of each chapter, enabling the reader to try out the calculations recommended by the authors. The book refers to a website which is said to contain software for calculating the answers; I was unable to find any such software at the URL given. In my opinion the book is most useful for the ideas which it provides about the sorts of things HR professionals should be attempting to measure and calculate.
on May 5, 2010
Investing in People is a valuable, technical resource that is probably most useful to Human Resource professionals in large corporations or labor intensive organizations. The title is a bit misleading in the sense that Investing in People doesn't really tell the average business owner or department head, or HR manager how to invest in people.
What this book does do, quite well, is to explain how the results of specific tactical HR iniatives can be measured. Given the soft, less than practical reputation of some work-life programs, this is a good thing. Its a proactive tool for the Human Resource Executive to use to measure the impact of something like a healthy eating program, a quit smoking, or stress reduction program. With this information the HR Executive can measure the impact of a given initiative, and decide rationally whether such a program should be continued or changed. Some of the areas examined are absenteism, health, turnover and work-life programs such as childcare.
This is a fairly technical book. Most HR execs who read it will end up assigning at one or more professionals to the task of applying the information. The work involved is not the kind of thing someone does during an odd slow period. To use this book an HR department has to be focused and determined to measure results. The population studied should be significant. For this reason Investing in People will be most useful to an HR exec who needs to study the effects of a program on a large population of employees.