5 INTANGIBLE ASSETS EMPLOYEE PERFORMANCE MONITORING SOFTWARE INCREASES

Assets being the backbone of any company, the managerial staff is responsible for maintaining and nurturing them. Cash, equipment, property, and other physical assets enable production cycles of any company. On the other hand, intangible or non-physical assets become of equal importance for keeping the company performance on a sustainable level. Some examples of intangible assets are employee engagement, business reputation, loyal clientele, etc.

The application of employee performance monitoring software facilitates the value increase of the following intangible assets’: engaged employees, business reputation, intellectual property, licensing agreements, procedural and training manuals.

1. Engaged Employees Asset Boosts Other Intangibles

In their research, John H. Fleming and Jim Asplund have found that “engaged employees are the main source of intangible assets” (Human Sigma: Managing the Employee-Customer Encounter, 2007). The scholars state that psychologically and emotionally committed employees make business perform more efficiently and that healthy organization should invest into the staff engagement.

Employee monitoring software is a way to measure employees’ engagement, one of the most important intangible asset.

The reports of performance monitoring software take the wraps off the attendance and productivity issues via login/logout monitoring, active and idle computer times monitoring, open software and documents monitoring, the Internet usage monitoring, etc. The rationale of monitoring the level of staff commitment lies within the costs of employee engagement campaigns optimization and to generate the profit out of given company intangibles.

2. Business Reputation Asset Depends On Employees Behavior

The asset called “business reputation”, namely what potential clients or business partners think about a business might be associated with the company employees’ behavior during the working day. Non-business web distractions usually depict inacceptable staff behavior, which leads to business reputation loses. For example, when bank employees are witnessed to socialize via FB or Twitter (in other words, caught not performing their responsibilities) during their working hours, the value of the bank’s reputation asset might go down.

URL monitoring is required to monitor such non-business related activities. Relevant software reports show employee web surfing habits, the analysis of which provides managers with information to ensure an appropriate business reputation. It could be reached by introducing the corporate policy of non-using FB/Twitter /Internet for personal purposes usage and coaching the staff with the guidelines based on the monitoring reports’ results.

3. Company Know-How And Intellectual Property (IP) Are Safe Now

Dr. Nir Kossovsky, the executive secretary of the Intangible Asset Finance Society and the CEO of Steel City Re (a provider of financial reputation assurance solutions) states that “many companies are seeking alternatives to the invent it–sell it model” and “one alternative… is for the company to use a financial strategy to monetize its most valuable asset of the knowledge economy: its IP”.

In other words, without the information, an intellectual property provides, no business would be profitable. That is why it gets so important to protect corporate IP asset. Productivity monitoring software makes it possible to block access to most significant know-how files to the employees searching for another job and browsing LinkedIn for better employment.

4. Licensing Agreements Asset Could Be Optimized

An asset called “licensing agreement” enters a wider group of non-physical assets named contract-related intangibles. Nowadays, software application contracts play a crucial role in building the licensing agreement asset. For the purposes of the software application contracts’ valuation and negotiation, software asset management (SAM) is used.

Moreover, application monitoring software, used by SAM, is a money-saving technique that detects rarely used and unused software. The managerial awareness about licensed/unlicensed programs usage helps to develop efficient strategies on company balance sheet monetization, namely perform the value increase of licensing agreements asset.

5. Procedural And Training Manuals Asset’s Value Increase

HR-related intangible assets have recently earned their popularity. That is why companies invest efforts and money into building the working environments that incorporate coaching and training. Training manuals and seminars development is its crucial element and an important non-physical asset.

Some factors that could be considered in developing procedural and training materials are employee Internet usage habits and employee application usage frequency. The data is easily extracted from employee productivity monitoring software reports.

Companies with High Intangibles Have Better Returns

Baruch Lev, a professor of Accounting and Finance at New York University Stern School of Business, has extensively researched intangible assets and their contribution to a company market value. The professor found that intangible assets contribute much to the market value of a given company. According to Prof. Baruch Lev, the company portfolios with high intangible assets predict the stock market returns better than even earnings or cash flows, and his tests have shown that companies with strong intangible assets have higher financial returns!