Modeling Employee Life Time Value (ELTV)


Employees form the most expensive asset of an organization. Human capital is behind every innovation, technological breakthroughs, and growth of any organization. The organization must be able to measure the value of the people and invest in them appropriately to make them feel valued. Employee Life Time Value (ELTV) is one such metric measuring the financial value, the employee brings to the organization. Estimating the ELTV helps the decision-makers in both HR and business line managers to plan the alternative actions build a team with an optimal ELTV. ELTV can be used in pre-recruitment and post recruitment covering all the Employee Life Cycle touchpoints. This paper proposes a five-stage framework to measure the value of an employee. First, a rule-based model for employee cost/revenue computations; second, an ML-based model for computing the performance score; third, an ML-based model (using Auto-ML) to predict the attrition propensity; fourth, computation of the ELTV per employee; fifth, profiling the employees based on ELTV and Performance to segment them into four quadrants to help in managerial decision making. This also brings the concept of Money ball in HR, building high performance team with higher financial value per employee.

Published in: Proceedings of the Sixth International Conference on Business Analytics and Intelligence, December 2018, IISc, India.


J.B Simha

Shinu Abhi

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