Watson Wyatt’s HumanCapitalIndex - blindSpot

Watson wyatt sHuman capital index human capital As a Lead Indicator ofShareholder Value2001/2002 Survey capital index : human capital As a Lead Indicator of Shareholder ValueWatson wyatt WorldwideCan the way a company manages its human capital significantly affect its financial performance?Two years ago our human capital index (HCI) study confirmed that the two areclearly linked. We developed a simple set ofmeasures quantifying exactly which HR prac-tices and policies have the greatest correlationto shareholder value. Using those to assign asingle HCI score to each surveyed companyallowed us to deliver conclusive, ground-breaking results: Where there are superior HRpractices, there is higher shareholder value. Yet a crucial question remained: Do betterpeople management strategies actually createhigher market value? Or do financially success-ful companies simply have more resources toallocate to human capital initiatives?

Watson Wyatt Worldwide Human Capital Index: Human Capital As a Lead Indicator of Shareholder Value In the first HCI study, conducted in 1999, Watson Wyatt surveyed more than 400 U.S.-and Canada-based companies that were publicly traded, had at least three years of shareholder returns and had a minimum of $100 million in revenue or market value.

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