Human Resources Metrics, Reporting, and Financial Management Module 2 - Types and Use of HR Metrics Flashcards
What are human capital metrics?
Describe the characteristics of the workforce.
Education level, experience, skill inventories, performances scores, tenure.
What are human resources metrics?
Describe the efficiency and effectiveness of HR programs.
Impact, speed, cost
What is an HR audit?
A review of HR policies, programs, processes, and documentation to identify opportunities to improve efficiency, effectiveness, customer satisfaction, and legal compliance.
What are efficiency metrics?
Assess whether things are being done right.
Doing things right
What are effectiveness metrics?
Assess whether the right things are being done.
Doing the right things
What are operational metrics?
Assess the efficiency and effectiveness of programs and services.
Short term impact
What are strategic metrics?
Assess the linkage between HR programs and services and the organization’s strategic goals.
Long term impact
What is the 5C Model of HRM Impact?
Suggests that there are five important areas to measures when valuing what HR brings to an organization.
The areas are: compliance, client satisfaction, culture management, cost control, and contribution
What are metrics used for?
Establish baselines
Conduct benchmarking
Track trends
Justify strategic decisions regarding talent management
Measure the impact of HR on the organization’s bottom line
What to metrics enable HR to do?
Speak the language of business
Put forward convincing business cases
Report empirical evidence
Be a true strategic business partner
What is an HR dashboard?
A tool that visually displays important HR metrics.
What are productivity metrics?
Absenteeism
Overtime
Human Capital Return on Investment
What does absenteeism measure?
of workdays missed due to illness per full time equivalent employee (FTE) = sick days / FTE
What does overtime measure?
Average # of overtime hours worked by each individual contributor = overtime hours / individual contributor headcount
What does human capital return on investment measure?
Rate of return for each dollar invested in employee pay and benefits = [revenue - (operating expenses - compensation and benefits costs)] / compensation and benefit costs
What does compa-ratio measure?
A compensation metric.
For an individual = individual’s salary / midpoint of salary band
What are recruitment metrics?
% of positions being actively recruited for
External hire rate
Average time to fill when hiring from outside
Cost of external hires
Quality of external hires by source
How is the % of positions being actively recruited for calculated?
Vacancy rate = # vacant positions / headcount
How is the external hire rate calculated?
External hire rate = # external hires / # all positions filled
How is the average time to fill when hiring from outside calculated?
= sum of all external days to fill / # external recruits
How is the cost of external hires calculated?
= total external hiring costs / # external recruits
How is the quality of external hires by source calculated?
= average performance rating of new recruits after 3 months from each hiring
What are retention metrics?
Turnover
Executive voluntary turnover rate
Succession planning rate
How is turnover calculated?
Turnover = (resignations + retirements + involuntary terminations) / headcount
How executive voluntary turnover rate calculated?
= (executive resignations + executive retirements) / executive headcount
How is succession planning rate calculated?
= # of succession planning candidates / executive level headcount
What are labor relations metrics?
Grievance incidence
% of grievances closed
Arbitrated grievance rate
How is grievance incidence calculated?
= # of open grievances / unionized headcount
How is % of grievances closed calculated?
= # of grievances closed / # of open grievances
How is the arbitrated grievance rate calculated?
= # of grievances gone to arbitration / # of open grievances
What are learning development metrics?
Cost per FTE Cost as a % of revenue Cost as a % of payroll Incidence Duration Participation
How is cost per FTE calculated?
= learning and development cost / FTE
How is cost as a % of revenue calculated?
Learning and development cost / revenue
How is cost as a % of payroll calculated?
= learning and development cost / labor costs
How is incidence calculated?
= # of learning and development events / FTE
How is duration calculated?
= # of learning and development hours / FTE
How is participation calculated?
= # employees attending learning and development events / # of all employees
