Large Organizations That Focus on Excellence in Human Capital Management May Be More Likely to Outperform The Market, According to Taleo Customer Study
San Francisco, CA – March 30, 2005 – Taleo Corporation, the world's leading company focused solely on on-demand talent management solutions, today announced the results of a study that supports the premise that large organizations that focus on excellence in human capital management (HCM) may outperform the broader market.
The Taleo study tracked the stock price performance of Taleo customers that are members of the S&P 500 and compared that performance with the overall S&P 500 for the years 2003 and 2004. The Taleo data is consistent with studies conducted each year by such companies as Watson Wyatt, which has published the "Human Capital Index®: Human Capital As a Lead Indicator of Shareholder Value" annually since 1999.
Fifty of Taleo's approximately 165 customers are members of the S&P 500, including Limited Brands, Starbucks, Dow Chemical, Rockwell Collins, Cendant Corporation, and UnitedHealth Group.
Data points include the following:
- For 2004, the S&P 500 stock price performance increased 9 percent.
- For 2004, Taleo S&P customers saw a 13 percent increase in stock price performance.
- Based on these increases, Taleo S&P 500 customers' stock price performed 49 percent better than the overall S&P in 2004.
- For 2003, the S&P stock price performance increased 26 percent.
- For 2003, Taleo S&P 500 customers saw a 30 percent increase in stock price performance, for an increase of 15 percent above the overall S&P 500.
- For both years, Taleo S&P 500 customers outperformed the greater S&P by 27 percent.
- The same market cap weighted average was used for all calculations.
According to Taleo Executive Chairman Louis Tetu, "Our S&P comparison points to a correlation between a company's focus on human capital and management of this precious asset and high performance in the market."
Lisa Rowan, analyst and program manager, HR management and staffing services with industry analyst firm IDC, notes, "Large organizations have tremendous opportunities to increase performance through talent management initiatives. It is interesting to see the results as those in the S&P 500 – Taleo customer comparison. These findings support IDC's research indicating that talent is emerging as a key differentiator in today's knowledge economy."
For example, Dow Chemical Company surpassed the greater S&P 500 with stock price performance of 46 percent in 2003 and 23 percent in 2004, for a cumulative increase of 79 percent over the two years. This compares to S&P 500 performance of 26 percent in 2003 and nine percent in 2004, with a cumulative increase of 38 percent, for percentage increases of 58 percent, 40 percent and 48 percent, respectively.
According to Jon Walker, Global HRIT Leader with Dow Chemical, "Every company says that its employees are its most important asset, but here at Dow, we actually walk the talk and live that maxim. We've shown quantifiable increases in productivity, internal mobility and our ability to retain our best and brightest employees through excellence in worldwide human capital management, innovative employee programs, and technology, including our use of Taleo talent management solutions."
About Taleo Corporation
Taleo is the worldwide leader of on-demand Talent Management Solutions covering salaried, hourly and contingent workers. Taleo helps organizations of all sizes improve business performance by more effectively acquiring, deploying, retaining, measuring and managing their workforces. For the first time, Taleo arms HR Executives and Staffing Directors with the capability to wring out talent management costs, respond more quickly to organizational demands and drive workforce quality. Taleo turns talent management into a source of value, competitiveness and workforce performance management. Taleo serves the world's most demanding businesses and is one of the world's largest ASP's with more than 400,000 users and 24 million candidates across 87 countries.
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