3 Alternatives to ROI in HR – Part 3

Morten Kamp series on alternatives to ROI in HR. Part 3 of 3

See his related post:
ROI is NOT the Answer in HR
Alternatives to ROI in HR (Part 1)
3 Alternatives to ROI in HR (Part 2)

(updated: Oct 10, 2012)

All about Human Capital

ROI is used more and more in HR when justifying or evaluating HR projects. But it has at the same time come under a lot of criticism for being too difficult to use in HR. The first alternative I suggested was another financial ratio – CROCI – which may be better due to its focus on cash and the balance sheet. But while it is a much better ratio than ROI, it is more complicated to use. The second alternative was friction & flow, which is highlighting that HR should create flow and remove friction allowing employees to get on with their day-to-day things. This alternative is very common sense (its strength) but very vague (its disadvantage).

My third alternative is trying to measure HR’s strategic relevance. To understand why, let’s take a step back and ask “what is the purpose of HR?”. What is the ultimate outcome of…

View original post 555 more words

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About Erwin Muniruzaman

A seasoned HR Practitioner with a span almost 15 years on overall HR experience practice of strategizing, policy making and running HR Service operations in Banking Industry and Retail in Indonesia. Developing HR strategy and practice align with Business Strategy as continuous goals. A passionate Reward designer, genuine Talent strategist and enthusiast Problem solver that always eager to share his ideas, opinions and experiences about HR related topics (especially Indonesian cases) to public, as a speaker as well as a HR blog writer in his personal blog/LinkedIn Profile : http://www.mewarisgagasan.wordpress.com https://id.linkedin.com/erwinmuniruzaman

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