This presentation offers new indicators to measure employee performance, which are based on the modification of established financial ratios

1. Employee BankruptcyRatio Ali Anani

2. Employees as Assets and Capital Employees are assets and capital. So, why not apply financially-derived indicators to evaluate their performance? Unfortunately when we and the systems we are in are under stress, we can become less flexible and less able to accept the uniqueness of individuals. The higher the stress, the more control we exhibit. The greater the control, the less likely people will function at their best.

3. Examples of Possible Applications Employee Survival Ratio instead of Company Survival Ratio Employee Performance Score instead of Financial Credit Score

4. Survival Ratio of Companies Human assets Total employee assets Replace this with employeesknowledge Retained Employees/ Total Employees

5. Survival Ratio Notice the importance of assets. Employees may turn into liability and thus kill the company Or, the bankruptcy predictor

6. Employee Value CalculatorPerformance Bankruptcy Predictor Motivation Cost of Disengagement Remember that disengagement renders the employee as liability instead of asset The cost is both financial and psychological Disengagement

7. Disengagement Cost Calculation- Base Scenario Notice that the cost of the annual cost totals $ (564408) http://www.baselinemag.com/c/a/Projects-Management/How-Much-is-an-Employee-Worth/

8. Disengagement Cost Calculation Notice that lowering the percentage of disengaged employees from 60% to 30% and increasing the moral of disengaged employees from 40% to 60% reduces the annual cost of disengagement to almost one third. The human factor is of overriding importance

9. Net Worth Value Of an Employee I developed this dynamic worksheet based on the grand work of Paul A. Strassmann. The net worth of an employee is negative. Replace this value with the net worth value in the Almans’ Z-Score and the survival of a company becomes critical

10. Net Worth Value Of an Employee- 2 Notice how reducing the number of employees from 10 to 6 renders the net worth of an employee positive. This shows how employees may be an asset or a liability greatly influencing the survival ratio of a company

11. A Great Lesson to Learn The previous discussion highlighted the sensitivity of the survival ratio to the human factor I propose the development of an Employee Survival Ratio to better predict the insolvency and possible bankruptcy of companies

12. Financial Credit Score Like we have a financial credit score per employee why not consider developing Performance Credit Score per employee

13. Credit Formula Calculation Work History is 35% Payment history is 35% Employees who conform to work hours and completion of tasks on time with high credit

14. Credit Formula Calculation Debt level is 30% Employee Benefits Level (30%) Employees who conform to work hours and completion of tasks on time with high credit

15. Credit Formula Calculation Length of credit history 15% Length of Performance History 15% Dynamic evaluation system as it takes time into consideration

16. Credit Formula Calculation Inquiries are 10% Too Many Complaints 10% Frequent complaining lowers productivity

17. Credit Formula Calculation Mix of credit is 10% Mix of activities 10% Lack of focus of employee

18. Conclusion We need to turn financial ratios into human employee performance ratio to arrive at better prediction of the future