Ch 14: HR Assessment and Analytics Flashcards
Workforce Analytics
How HR Metrics such as turnover and employee engagement are used to describe the workforce
HR Analytics
is an evidence-based approach for making better decisions about employees and HR Policies using a variety
of tools to report HR
metrics and to predict outcomes of HR
programs
HR Metrics
Data set- measures of HR activity
Importance of Assessing HR Function
- Credibility
- Effectiveness
Resistance
- Many practitioners do not understand how to use HRIS, measuring tools and interpret them
- No standard way of measuring
Interest in measuring
HR is growing slowly, fuelled by
- Business improvement efforts across organizations
- Attempts to position HR as a strategic partner
- The need for objective indicators of success to accompany the analysis of HR
act1v1t1es
Nine Reason National for Measuring HRM effectiveness
- Labour cost is the firm’s largest controllable costs
- Managers recognize that employees make the difference between the
success and failure of projects and organizations. - Ensure compliance
- Fad vs Valid programs and practices
- Measuring and benchmarking HR activities will result in continuous
improvements. Performance gaps can be identified and eliminated - Objectively show how HR contributes to Competitive advantage
- Data will be available to support resource allocations
- Investors want this information. Why? The market-to-book ratio suggests
that for every $6 of market value, only $1 appears on the balance sheet- So when a metric such as employee commitment rises, investors can use this
number to predict increases in customer satisfaction, retention, and sales.24 - HR managers are more likely to be welcome at the boardroom table, and to
influence strategy, if they use measures to demonstrate the contribution of
their function.
5c Model of HR Impact- how we assess hr department
Compliance- laws on equality, fairness, disclosure, wages, recruitment practices, labour union activities, sexual harassment,
Client Satisfaction- External and internal- QSM
-adv: reminds HR they are service oriented, surveying unmet needs increases credibility, surveying before, during and after change program can help HR better understand client HR perceptions, resistance to change and how to overcome
methods: informal feedback
surveys
Critical incident- when HR did something significantly helpful, and why was it so helpful
Culture Management- Attitude survey- perceptions on organizational characteristics
Att- sat, mot, commit, avo. = eng
Cost Control- tech, outsourcing, downsizing; increase efficiency, reduce costs linked to- absenteeism, turnover, accidents, low morale
Contribution- how does it impact the bottom line
PROBLEMS WITH MEASURING CLIENT SATISFACTION
HIGH EXPECTATIONS OF CLIENTS
Conflicting expectations between stakeholders
Professional affiliation/bias- focus on values of hr than values and needs of line managers(who may just want a quick hire)
How to increase efficiency- cost control
Measures of efficiency include the following:
- Time (e.g., average time to fill an opening, process a benefits claim)
- Volume (e.g., number of people interviewed to fill a job, number of requests
processed per employee) - Cost (e.g., cost per training hour or per test).
Take these and make benchmarks according to industry standards/best practices.
Contribution
FINANCIAL MEASURESMEASURES OF MANAGERIAL PERCEPTIONS OF EFFECTIVENESS
FINANCIAL MEASURES
SURVIVAL
Profits/ROI/ROE
MEASURES OF MANAGERIAL PERCEPTIONS OF EFFECTIVENESS
- Ask managers to assess org performance vs others
-Let Managers choose amongst or all 5 C’s
Approaches to Measuring HR Performance
Activity Based, Cisting, Client (typical)
Value-proving methods: cost benefit anaylsis, utility analysis, benchmarking,
COST-BENEFIT ANALYSIS
- The relationship
between the costs of a
program and its benefits - Direct costs: hard costs that can be measured by expenditures
- Indirect Costs: Soft costs not easily measured by financial measures (like trainee time off work)
UTILITY ANALYSIS
- A method of determining the gain or loss that results from different approaches
Bench marking
- establishing standards against which processes, products, and performance can be compared
and subsequently improved.
An audit measures progress against goals.
can be used to motivate, inspire new ways of thinking,
-sources of benchmarking partners:
- internal
- competitive
- Sector- HR benchmarking sub committees
- Best-in breed co
Hr Scoreboard
- Balanced scorecard
A balanced set of measures to show contribution to organizational performance.
shows:
- How do customers see us? (The customer perspective)
- What must we excel at? (The internal business perspective)
- Can we continue to improve and create value? (Innovation and learning
perspective) - How do we look to shareholders? (The financial perspective)
Measuring Worth of Employees
Efficiency- cost per hire, time to fill, ratio of staff to employees
HR Activity, best practice- human capital benchmarks
HR Score board- How Hr function meets goals of customers, financial markets, operational excellence, and learning
Causal Chain- Models linking attitudes to service behaviour to customer responses to profit.
three hurdles to the development of these HR metrics:
- Identifying measures that are grounded in research and theory and are
practical - Gaining acceptance of these measures by the stakeholders
- Applying these measures consistently and over time.
deciding which measures to use as standard
alignment
actionable: choose controllable measures
trackability: able to follow changes overtime- allows for solution making
Comparability: choose measures that can be compared
drill deep: measures must be specific- averages cover up issues
Stick to a few: 5-10
Another way of deciding on measures to use
Level 1: Basic data-headcounts, number of positions etc.
Level 2: Operational data-training days, number of grievances etc.
Level 3: Employee data-levels of engagement, absenteeism, turnover etc.
Level 4:
Organizational data-the correlations between turnover and sales; between
engagement and unit performance
Presenting to the board
- Know the numbers- absenteeism, employee perception on equality etc
Future of HR ANALYTICS
- trend is up
- establishments of units where HR data is tightly linked to operational data
