For the First Time Ever, Dow Jones Industrial Average Companies Derive a Majority of Financial Value from Their People, Says Talent Growth Advisors' Annual “Intellectual Capital Index”

Talent Drives More than $4 Trillion in Value Across DJIA Companies from Visa to Pfizer

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| Source: Talent Growth Advisors

ATLANTA, Nov. 16, 2017 (GLOBE NEWSWIRE) -- National management consultancy Talent Growth Advisors (TGA) today announced the results of its annual Intellectual Capital Index (ICI) for 2016, a yearly study that measures the specific dollar-figure contributions talent makes to the market value of companies in the Dow Jones Industrial Average (DJIA). The analysis reveals that a majority of the enterprise value -- on average 88 percent -- is driven by the company’s people instead of its tangible assets, even in companies often perceived as industrial companies such as Caterpillar and Dupont. The analysis also reveals that the overall value of talent-driven intellectual capital across DJIA companies now totals more than $4.3 trillion -- a growth of more than $300 billion over 2015.

“We are well past the tipping point of talent making -- and demonstrating -- substantive bottom-line value to their organizations. Finally, talent is actually proven to be a company’s most important asset, contributing to at least 50 percent of a company’s total financial value,” commented Linda Brenner, co-founder and managing partner, Talent Growth Advisors. “If the leadership of companies within the DJIA and beyond aren’t already paying attention to their talent acquisition and talent management efforts, now is the time, as the link between people and dollars has never been greater or clearer.”

The most recent Talent Growth Advisors Intellectual Capital Index ranked the top five “intellectual capital” companies -- those driving the most financial value from their talent -- in the DJIA today as: 1. Pfizer, 2. Boeing, 3. Apple, 4. Visa and 5. Johnson & Johnson. It also shares insights into market value drivers, including:

  • Talent investment and cost cutting co-exist to build value. While additions to intellectual capital drove value creation, companies in the study also continued to gain efficiency by reducing tangible assets by $70 billion and overall headcount by 78,000.
  • DJIA companies increased spending on R&D in 2016 by more than 9 percent over 2015.
  • Visa leads companies in the study on an “intellectual capital value per employee” basis, at nearly $15 million per employee.
  • GE increased its intellectual capital index after shedding GE Capital, following similar trends as Abbot and Alcoa, increasing prospective shareholder value and raising the stakes for talent as key to their future success.

“We could assert that Visa is the smartest company in the DJIA, and we have the data to back it up. Regardless of who is leading the pack, there is no doubt that we should indeed re-christen the DJIA as the ‘Dow Jones Intellectual Average,’ based on these findings,” commented Tom McGuire, co-founder and managing partner, Talent Growth Advisors. “We are thrilled to help companies link their human capital and financial capital, while advising them on how to find and retain the right talent for their most critical roles that drive both present-day value and long-term growth.”

Talent Growth Advisors works with a wide range of industries and brands across the Fortune 500. To determine the ICI, a financial analysis of the stocks comprising the DJIA was conducted. For more information, visit http://talentgrowthadvisors.com/our-big-idea/ici/.

About Talent Growth Advisors
Talent Growth Advisors is a national management consultancy born from a blend of finance and talent management expertise. The firm helps companies connect talent investments with business value by creating and measuring strategic, differentiated approaches to hiring and talent management. Led by a team that has run finance and talent functions at Fortune 500 companies, Talent Growth Advisors has partnered with leading brands across industries in talent planning, talent acquisition and talent management. For more information, visit www.talentgrowthadvisors.com and read about our detailed approach in our book: “Talent Valuation:  Accelerate Market Capitalization through Your Most Important Asset,” available on Amazon.

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