Although the need to effectively measure human capital (HC) is a high priority for executives all over the world, such metrics continue to bedevil them. It’s true that technology is allowing organizations to move beyond traditional HR measures to more sophisticated ones (Schneider, 2006), but it’s hard to know which of those measures are worthy of leaders’ trust when it’s time to make important decisions.
There are many approaches to HC measurement, and each may serve a different purpose. Among the best measures for strategic decision-making purposes, according to data from The Conference Board, are those related to employee satisfaction/engagement, remuneration, leadership, productivity and recruitment (BNA, Inc., 2005).
