The ROI of Human Capital: Measuring the Economic Value of Employee Performance, Second Edition

OUTSOURCING: A NEW OPERATING MODEL? 253

ployee assistance programs, are being outsourced. Outsour-

cing works the most cost effectively if we look at both the

human and the financial aspects of it. Cutting costs while

destroying morale is not a cost-effective move. We have

learned from the top-performing companies that a balance

of human and financial value is optimum.

In the beginning, three of the most common goals for out-

sourcing were cost reduction, time saving, and service-quality

improvement with cost being the dominant criterion. How-

ever, there is a question that transcends those important

goals and should drive any consideration of outsourcing, or

any other initiative, for that matter. It is:

How do we manage human capital to optimize value