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HR Metrics - Lesson 2

This document discusses HR metrics and why they are important for managers. It notes that interest in organizational data and evidence-based management has increased the focus on HR metrics. While infrastructure for HR metrics has improved, managers must make different and better decisions based on the information for the time spent on metrics to be worthwhile. The document outlines best practices for developing HR metrics including collecting relevant data, benchmarking, reporting dashboards, and having centers of excellence. It traces the evolution of HR metrics from efficiency to effectiveness to predictive analytics and notes that developing HR metrics is a journey, not a destination.

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Maheen
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128 views12 pages

HR Metrics - Lesson 2

This document discusses HR metrics and why they are important for managers. It notes that interest in organizational data and evidence-based management has increased the focus on HR metrics. While infrastructure for HR metrics has improved, managers must make different and better decisions based on the information for the time spent on metrics to be worthwhile. The document outlines best practices for developing HR metrics including collecting relevant data, benchmarking, reporting dashboards, and having centers of excellence. It traces the evolution of HR metrics from efficiency to effectiveness to predictive analytics and notes that developing HR metrics is a journey, not a destination.

Uploaded by

Maheen
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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HR Metrics

Lesson # 2
HR Metrics- Why?
• What caused an increase in interest for managers to go for
organizational data:
• Evidence based management
• Examining transaction level data
• Quality revolution
• Total Quality Management (TQM)
• Six Sigma
• Lean Manufacturing
• Financial/ Marketing/ Supply Chain
• Profitability ratios; Acquisition, retention, development; On-time shipping, Inventory
Velocity
• Generated interest in HR Metrics
What has changed?
• Infrastructure which supports HR metrics have changed in last 20
years
• Changing the way we look at metrics
• Previously focus was primarily on the data which is coming from accounting
systems
• Costs
• Revenue per employee
• Benefit costs as per percentage of revenue
• Expense per employee
Need of the hour
• Information systems can only have an impact on organizations if as a
result of the information they receive, managers make different and
better decisions than they would have without that information.
• Beneficial only if managers change their decision behavior for the
better.
• Efforts wasted if:
• managers do not make different and better decisions as a result of the
information reported to them, the time and effort expended in conducting
and reporting HR metrics and analytics is wasted
Study and practice of HR metrics
• Data
• Benchmarking
• Reporting
• Dashboards
Study and practice of HR metrics
• Data
• Getting the relevant data
• Finding correlation and patterns in data
• Don’t go for nonsensical relationships (taller employees are better leaders etc.)
• Benchmarking
• For comparable industries
• Reporting
• What metrics will be reported
• How info will be packaged
• Abstraction level (how, when and to whom it should be reported)
• Dashboards
• All organized metrics/KPIs on one single page
• Enriched component of reporting
• Interactive dashboards
Role of Data?
Role of Decision Modelling
Excellence in HR metrics requires..
• Centers of Excellence
• Having a good know-how of HR practices
• Well aware of latest advancement in field of HR
• Maybe full time staff or consultants from outside
• HR Business Partners Centers of
HR Business
Partners
• Works with other function heads Excellence (HRBP)
• Assessing function’s HR needs
• Overcoming operational problems in HR
Administrative
• HR Administrative Process Efficiency Process
Efficiency
• Repetition of specific process at one place
• For continuous quality improvement
Evolution of HR Metrics
• HR Efficiency Metrics
• the amount of resources used by HR programs:
• such as cost-per-hire, revenue per employee
• HR Effectiveness Metrics
• the outcomes produced by HR activities, such as:
• learning from training, retention rate, eNPS
• Predictive Analytics
• Correlation between variables
How HR metrics fit into a bigger picture
It’s a Journey, not a destination
• Be willing to learn
• Avoid making aggressive metrics of every thing
• If you only have a hammer, you tend to see every problem as a nail

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