Likert's Model

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1. Likert’s causal, intervening and end-result variable model likert and Browers of the institute for social research, university of Michigan, USA developed a model of measure the human resource value as a group to an organisation. The model assumes that the organisational productivity can be explained in terms of human organisation. Rensis Likert, a behavioural scientist, has advocated model based on group processes or interactive process among people, Likert’s model is based on measured relationships among three groups of variable known as causal, intervening and end-result variables. The terms imply longitudinal cause-and-effect relationships which he has thoroughly documented through his research. Causal variables: these are independent…show more content…
He introduced certain factors to be multiplied with the net benefit of employees and then make the valuation of human resource. The net benefit mean the difference between expected benefit and total cost. The expected benefit of an individual employee are determined by the product of his monetary value benefits potential with his individual performance index. The certainty factor means the probability of the employee remaining with the firm. It is determined by assessing the probability of continuation of the employee and the probability of survival of the employee. The total cost means the total of the maintenance cost. The net benefit thus arrived at for all employees multiplied by their certainty factor equivalent net benefit which form the value of human resource.Expressed in general…show more content…
He has suggested that it is most appropriate to include human asset under the heading ‘investment’ in the balance sheet. The model advocates the valuation of human resource on aggregate basis instead of individual. However he recommended that managerial and non-managerial human resource can be evaluated separately. The value of human resource on a group basis can be found out by multiplying the average salary of the group with the average tenure of employment of the employee in that group. The average annual salary payments for the next few years can be found out by salary grade structure and promotion scheme of the organisation. It has further suggested that the recruitment, hiring, selection, training and development costs of each employee should be recorded separately, they can be treated as deferred revenue expenditure to be written off over the expected average stay of the employee in the organisation and deferred position should be shown in the balance sheet of the organisation. If there is a premature exit on account of death, retrenchment etc. then the balance on the deferred revenue account for the year attributable to that person should be written off against the income of the year of exit
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