The business environment is volatile and complex, and for longterm success, it is critical that a company practice strategic planning. In order to drive business objectives, human capital management must be part of that process. But are the goings-on of Human Resources truly measurable? Humans tend to be an unpredictable sort, so metrics for planning and analysis must be difficult to come across, right?
Actually, quite the contrary, Human Resources is equal parts art and science. There are many HR metrics that may suit your business’ initiatives, and below you will find 5 useful favorites that you should be familiar with.
In order to be competitive in a tight labor market, time-to-hire is a good metric to look at, indicating the time it takes to hire a candidate for a new position. This may help you tighten up your hiring process, providing better candidate experiences and boosting efficiency. If you’ve ever interviewed for a position with overly-lengthy time-to-hire, you understand how frustrating that process can be, twiddling your thumbs while you await word of the next step in their hiring process. Maintaining a shorter time-to-hire improves your reputation and saves money.
Here is an example question that an HR Manager may be seeking to answer with this metric:
The labor market is very competitive; what are we doing to ensure that top talent joins our team, rather than our competitors?
Are certain positions more difficult to fill than others? Why?
Another aptly named metric is cost-per-hire, telling you how much money your company is shelling out in recruitment efforts per person you hire. Bringing a new teammate aboard is never cheap, but this metric is important in making sure that the costs incurred during recruitment are efficient and competitive. This also really brings to light the cost of hiring poorly.
You might ask:
How can we free up more of our budget for training and development?
Are we spending efficiently through recruitment?
How will implementing a new applicant tracking system impact our finances?
Your company’s turnover rate is indicative of employee engagement and satisfaction, as this measures how many people are leaving your organization. Divide the number of employee separations by the average number of employees your business has at any given time. It is important to be familiar with common turnover rates within your industry, in order to properly analyze your data; of course, some turnover is healthy!
You might ask:
How can we measure our goal to improve our employee retention?
Is onboarding effective? What is our turnover rate within the first 90 days of employment?
Is our turnover higher within a certain department?
Absenteeism as a metric shows you how often people are missing work. This is useful in measuring employee engagement, and can also shed light on health and wellness issues. To calculate absenteeism, divide the number of workdays missed by the total workdays scheduled.
You might ask:
Would it be beneficial to implement an employee wellness program?
Is our PTO policy being utilized appropriately?
Absenteeism may be a predictor of turnover; how is our employee engagement doing?
How can we keep an eye on employee stress and burnout?
Metrics can and should be used in order to measure employee performance. Incentive metrics must be catered to suit not only your business but each employee. Identify clear goals for employee performance and create incentive programs to support them. Ensure that these desired outcomes are measurable, and tailor your metrics to those measurable. Revisit these often, and incentive metrics can be invaluable to your organization.
You might ask:
What are Sally’s key performance indicators that we can use in order to measure her progress and success this quarter?
It’s important to first begin by identifying your business goals so you may understand what question you want to answer with metrics. From there, you may monitor metrics with purpose as they apply to your business goals to ensure that your questions get answered; there is no need to monitor metrics that don’t serve your organization. A good rule of thumb is to look for leading indicators that align directly with your strategic plan; these metrics help you reach your goals and propel your business forward.
Human capital is too great of an asset to leave it up to chance. Monitoring HR metrics will help you make business decisions as you build your legacy.
We developed DashboardFox to allow businesses to affordably connect to their data and convert it into useable information, such as Human Resource metrics.
This savings comes in a few ways:
Affordable starting price – the cost of a single concurrent session license is $1500, not per month or per year, once. So this makes it perfect to do a longer-term proof of concept (after a free trial of course)
Affordable operations and maintenance – as an agile business intelligence tool, DashboardFox doesn’t require all the infrastructure, setup, and admin technical skills needed to get it installed and keep it running.
Ease of use for business users – as a self-service BI tool, it was designed for normal business users, just like human resource managers, executives, and hiring managers. They can quickly get to the dashboards and reports they need and apply filters to see how metrics change over time, location, or job titles.
Check out a demo of DashboardFox and contact us so we can discuss your HR metrics need. We’re not just able to talk to you about BI software, we can give you some advice on nailing down the right metrics for your business as well.