40 THE ROI OF HUMAN CAPITAL
AStrategicView
A customer-oriented strategy for improving shareholder
wealth would focus on three factors: costs, potential cus-
tomer value, and customer needs. The activity-based costing
methodology and its supporting software technologies have
provided the ability to trace the unique costs of customers,
channels, services, and products.
In contrast to calculating the profit from a past time pe-
riod, calculations of projected financial returns use time/
value-of-money principles that consider the timing of future
cash inflows and outflows, as well as the cost of capital. A
company’s ability to satisfy its customers and retain their
loyalty provides a sustainable competitive edge that allows
higher average prices relative to