Morse Model (Net Benefit Model)
This approach has been suggested by Morse (1973). According to this approach,
the value of human resources is equivalent to the present value of net benefits derived by
the organization from the service of its employees. The method involves the following
steps –
1. The gross value of services to be rendered in future by the employees in their
individual as well as their collective capacity is determined.
2. The value of future payments (both direct and indirect) to the employees is
determined.
3. The excess of the value of future human resources (as per 1 above) over the value
of future payments (as per 2 above) is ascertained. This, as a matter of fact,
represents the net benefit to the organization on account of human resources.
4. The present value of the net benefit is determined by applying a
predetermined discount rate (generally the cost of capital). This amount
represents the value of human resources to the organization.
c) Non- monetary value -based approaches:
Pekin Ogan (Certainity Equivalent Net Benefit Model)
This approach has been suggested by Pekin Ogan(1976). This, as a matter of
fact, is an ext4nsion of “net benefit approach” as suggested by Morse. According to this
approach, the certainty with which the net benefits in future will accrue should also be
taken into account, while determining the value of human resources. The approach
requires determination of the following –
1. Net benefit from each employee as explained under „net benefit approach‟.
2. Certainty factor at which the benefits will be available
