The new metrics of corporate performance: Profit per employe - The McKinsey Quarterly - corporate performance metrics - Strategy

Today's approach to measuring financial performance is geared excessively to the capital-intensive operating styles of 20th-century industrial companies. It doesn’t sufficiently account for factors such as the contributions of talented employees that, more and more, are the basic source of wealth.
Financial performance—observed through balance sheets, cash flow reports, and income statements—is and always will be the principal metric for evaluating a company and its managers. But greater attention should be paid to the role of intangible capital and the ways of accounting for it.
The superior performance of some of the largest and most successful companies over the past decade demonstrates the value of intangible assets.
Companies can redesign the internal financial performance approach and set goals for the return on intangibles by paying greater attention to profit per employee and the number of employees rather than putting all of the focus on returns on invested capital.

Exhibit 1: From 1995 to 2005, the 30 largest companies (by market capitalization) have seen their profits per employee increase dramatically.
Exhibit 2: Companies can create wealth either by increasing profit per employee, by increasing the number of employees earning such profits, or both.
Exhibit 3: The correlation of market capitalization to net income can be viewed in relation to returns on invested capital (ROIC) . . .
Exhibit 4: . . . or in relation to return on talent.

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This article is adapted from "Mobilizing Minds: Creating Wealth from Talent in the 21st-Century Organization," a book by McKinsey partners Lowell Bryan and Claudia Joyce. These Quarterly articles are also based on their research: