Decision Support for Employee Engagement Initiatives: Cumulative Value-Addition

The paper proposes an approach to compute a quantitative measure of cumulative value addition by an employee considering the impact of economic volatility. The difference between the cumulative performance and the cumulative wages provides a measure of the cumulative value addition of employees at any point of time. An approach to measure economic volatility using the deviation of GDP growth rate from a Time Series model has been attempted. Exponential and Erlang cumulative performance distributions have been used to illustrate cumulative value addition behaviours. The direction and quantum of cumulative value addition by an employee in an enterprise supports decision on employee engagement initiatives and provides an indicator of the operational efficiency of an employee at different points of time. This could be used as a decision support system to guide Employee retention and compensation policies, and welfare initiatives.