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

166 THE ROI OF HUMAN CAPITAL

degree of success. The goal is not to change the world over-

night. It is just to decrease the variance and increase the

certainty a bit at a time.

In general, people do not understand simple probability

statistics. Let’s use gambling as an example. The casinos in

Las Vegas make billions every year on just a percent or two

in favor of the house. However, when we apply that concept

to organizational improvement programs we can find simi-

lar incremental gains but not the same type of success. The

reason is that a couple percent of improvement in quality or

productivity in one part of the organization does not accu-

mulate to the same percent corporate-wide. In fact, in some

cases, the effect is only in the local process with ...