Companies across different sectors have started using data, analytics, and Digital HR in their workforce management and HR operations. Organizations are eager to gather and measure employee data and gain insights that could help them strategize and plan better. An extensive set of HR metrics, combined with predictive analysis, can allow you to increase your current workforce and acquire fresh talent. According to a survey by BambooHR, 82 percent of executives say that HR metrics are relatively valuable, helpful, or extremely useful for their organization.
With the digitization and implementations of analytics in the HR operations and process, HR professionals now need to step up their data analytics game. In this article, we have listed the top 20 HR metrics that you need to track in 2020. Before that, let’s take a look at what these HR metrics are.
HR metrics, or HR KPI, are key figures that aid organizations in tracking their human capital and measure how successful their HR initiatives are. For instance, such data would include turnover, cost-per-recruit, and benefits investment rate, to name a few. Considering and analyzing these data points and understanding what’s functioning well, what needs improvement, and predicting future trends help a company plan their people strategy.
Now, let’s take a look at the top 20 HR metrics of 2020.
HR metrics help organizations measure the efficiency of the HR function as a whole and assist in leveraging the workforce to increase profitability. Here are the top 20 HR metrics that you need to track in 2020.
One of the critical recruiting metrics is the ‘time to hire.’ It is the number of days between a vacancy in a job and a candidate signing the job contract. It’s a fantastic method to gauge the enrollment cycle’s proficiency and gives knowledge into filling a specific activity position.
It’s calculated by the total cost of hiring divided the number of new hires. Same as the ‘time to hire,’ the ‘cost per hire’ recruiting metrics show the amount of money the organization is spending on hiring new talent. It also acts as an HR KPI of the efficiency of the recruiting process of the company.
It is the percentage of new recruits leaving in the first year. This is apparently one of the most important recruiting metrics to decide the efficiency of recruiting success in an organization. This early leaver metric shows whether there is a confound between the individual and the organization or between the individual and his/her position. Early turnover is likewise expensive. It typically takes 6 to a year before employees have fully learned the organization’s threads and reach their ‘Optimum Productivity Level.
This HR metric shows the profitability of the organization as a whole. The ‘income per employee’ metric is an HR KPI of the quality of recruited employees.
The 9-box grid HR metrics are applied while analyzing and mapping both an individual’s performance and potential in three levels. This model shows which employees are underperformers, esteemed masters, developing possibilities, or top talents. This human resource metrics is incredible for differentiating, for instance, desirable and undesirable turnover.
This is one of the most concrete HR metrics examples, and it is particularly relevant for professional service firms like law and consultancy firms. Relating the employee’s performance to employee engagement makes it an interesting analysis.
An engaged workforce is a beneficial workforce. Employee engagement may be the most significant KPI for HR Manager. Employees who like their job and are pleased with their organization are commonly more engaged, regardless of whether the workplace is distressing and have high work pressure. Engaged employees perform better and are bound to see work stress as a challenge, not as a weight. Moreover, group engagement is an essential metric for an HR Manager’s success.
In this HR metrics, you divide the number of employees who remained in your company for 1-5 years by the number of total employees.
This is another HR metrics that show how cost-efficient HR processes are. An organization that has deployed HR Analytics and Digital HR in their workforce management have a smaller number of HR professionals performing added functions with more efficiency.
Organizations adopting advanced HR Analytics in their workforce management are able to analyze and predict the impact of HR policies. This will allow HR Managers to be more efficient and reduce the number of collaborations with business partners.
This is one of the HR metrics that calculate the number of employees leaving the company in a given year. When combined with any performance metric, the ‘turnover’ metric can indicate the difference between high and low performers.
This is one of the more complex HR metrics. For example, the learning and development efficiency is estimated by the number of dynamic clients, average time on the stage, meeting length, complete-time on stage per client every month, screen stream, and programming maintenance. These measurements empower HR to figure out what works for the employees and what doesn’t.
An unscheduled absence rate is a crucial KPI for HR Manager to analyze absenteeism. It shows the percentage of employees who are absent during a certain period. An increase in absence rates could mean a worsening work environment or heightened stress-level in the workplace.
It is calculated by dividing the number of absence days in a team by the total Full-Time Equivalent in that team. By using these HR metrics, the HR Manager can efficiently recognize the problem areas within the organization. When certain teams or managers primarily battle with high absence rate levels, they might be performing something incorrectly, and their presentation will probably suffer. This metric can be an analytical and preventive necessity by empowering HR to intervene before issues turn crazy.
Individuals wouldn’t fret staying at work longer than required sometimes. However, when overtime goes off the roof, it becomes stressful, and you can expect your absence rates to increase. Excessive over time, particularly for longer timeframes, makes turnover increase as well.
Earlier, employees work from 9 to 5. Nowadays, with more and more people working from home, organizations are progressively releasing the conventional mindset. This implies performance can never again be estimated by seeing who shows up. These days, it doesn’t generally make a difference how long you functioned in a day. What makes a difference are things that you really have accomplished. A productivity index keeps a record of this.
It is a typical HR metrics for preparing costs per employee. This cost could be for training, orientation, upskilling, or reskilling purposes.
To estimate the effectiveness of training, you need to analyze what people have learned. You can’t simply evaluate an employee’s proficiency just before and after the training. The reason is that individuals generally apply for training when they believe they are failing to meet expectations. Employees who perform beneath their normal for one month are bound to return to their typical performance the following month.
Training efficiency is critical as it helps you make the most of your money. It is calculated by dividing training expenses per employee by training effectiveness. It is one of the essential Human Resource metrics to evaluate employee satisfaction with development opportunities.
It is measured as employee satisfaction and is often identified as a vital HR metrics. Satisfied employees are prolific employees. They are dedicated to the company and don’t mind working overtime when required. Low employee satisfaction in certain company departments is the indicator of conflict or a stressful work environment.
Human Resource metrics offer many opportunities and possibilities for the organization and the employees. The above-listed HR metrics will help you to track key HR areas, measure efficiency, and the effectiveness of the HR processes.
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