Revenue Per Employee Human Capital Effectiveness

Revenue per employee examples example 1.

Revenue per employee human capital effectiveness. Revenue per employee is relevant for labor intensive industries i e. The formula is revenue head count full time employee equivalents. Human capital effectiveness calculations. S p 500 companies generated 11 trillion in combined revenue and employed more than 25 million people worldwide.

You ve reached the end of your free preview. In short the relevant human capital measures are the performance. In this report we rank the companies by revenue per employee rpe to explore how efficiently the companies utilize human capital. In 2017 the s p 500 index increased by 22 from 2016 2017.

A similar ratio is net income per employee which measures net income earned by each employee on average. Many start ups have yet to hit profitability and therefore cannot use this measure. Revenue per employee is a basic measure of this. Among the 250 different metrics used by the institute are revenue factors profitability and investment in a company s workforce.

Employee turnover need measurement of productivity and revenue of employee production deducted with cost of recruiting training new employee. Formula is revenue head count measure of employee productivity and shows the sales revenue generated by each full time employee. Revenue per fte human capital return on investment hr costs per fte hr costs per employee labour cost revenue percent learning development investment per fte cautionary notes this metric is not for every organization. By performance we mean employee performance that effectively implements the firm s strategy.

Using a number of formulae researchers at the institute are able to quantify the value of human capital as well as its overall effectiveness claims robert morgan president of the human capital consulting group. Google has this employee of 1 457 million and amazon has a revenue of 392 034 per employee. Revenue per employee is a basic measure of human capital effectiveness. Industries in which human capital is more important than the physical capital for revenue generation.

Should value human capital in the organization based on the performance of that human capital. Revenue per employee also suggests that a company is using its resources in this case its investment in human capital wisely by developing workers who are very productive. When we compare to this per employee of facebook google and amazon we note that facebook has the highest annual this employee at 1 929 million per employee.