6 Common Questions About HR Metrics Answered

by Saba Software | Posted | Business Impact

6 Common Questions About HR Metrics Answered

As an HR professional, you collect a wealth of talent data. And no matter how that data is stored - in filing cabinets, spreadsheets or through an automated system - you need to measure and analyze the right data to effectively assess how employees are performing against corporate objectives.

To do that, you need to first determine which talent metrics are most important to your business.


In February, I had the pleasure of co-hosting an HR.com webinar on making talent management metrics matter with Cathy Missildine, Principal and Co-Founder of Intellectual Capital Consulting. Cathy is a sought-out speaker and expert in strategic Human Resources Management and we're pleased to have her keynote Halogen Software's Sixth Annual User Conference this September.

In this post, I chat with Cathy about six common questions related to establishing and using HR metrics strategically.

Sean (S): What are some common mistakes people make when trying to establish HR Metrics?

Cathy (C): What I see most often is that HR professionals will start measuring without starting first with the organizational strategy. The strategy is key to measuring what matters most.

Sure, there are some common metrics that everyone uses like turnover, time to fill, productivity and quality of hire.

But in order to know how you are performing against strategy, HR needs to align themselves to that strategy and determine which people metrics will measure human capital impact.

S: If goal management is to be considered a key metric, how to do you ensure that the hundreds of goals set for employees every year are actually tracked?

C: In my experience you really have to leverage technology to help with the goal tracking process. Unless you are a very small firm, then perhaps you can be a little more manual, but once you get into significant numbers of employees the process gets very arduous.

S: Has time to hire and other recruiting metrics been replaced by quality of hire entirely?

C: I think there is room for both those metrics. Time to hire gives you a measure of 'efficiency' on how well your recruiting department is performing. But, quality of hire (effectiveness) should be the desired result.

It's all well and good to hire someone in 30 days, but if they can't perform, then who cares how long it took to find them!

S: How do you measure the risk of leaving?

C: In our experience we look at several factors when calculating risk of leaving. One is how engaged is that employee and how has his performance ratings been trending. This is one area where you can get predictive with your data.

By looking at engagement scores, performance scores and turnover of past employees, you can predict with a high degree of certainty who is at 'risk for leaving' using simple correlations and regression models.

S: How do you calculate 'time to productivity' for new hires?

C: You have to have a good set of criteria for success documented on the front end. For example, you have a new hire that starts in January and you have documented that for his particular position to be considered fully functioning and performing, task A, B, C and D must be mastered and demonstrated.

You then just track the new hire's performance on these tasks and calculate time to productivity. Taking this one step further, you then use salary information to get the dollars associated with getting a new hire up to speed.

S: How do you get people leaders to embrace/execute performance management as a business imperative rather than seeing this as HR driving their agenda?

i.e. developing performance objectives, employee development planning etc.

C: What a great question and what a great way for HR to be truly strategic in their roles as business partners! If management truly understands the business strategy, then they understand intuitively that everyone in the organization has to be rowing the boat in the same direction.

Making sure all employees understand how their role fits into the big picture is critical for success. I believe the best tool to enable that process is an effective performance management system that has:

  • goals and objectives tied to the organizational strategy,
  • employee development linked to competencies which drive the strategy, and
  • managers who execute the system well.

I believe when managers see the linkage between the performance management system and what the company is trying to accomplish strategically, that they view those things as tools rather than an agenda.

So, HR has to make sure they have done their homework where performance management is concerned - this includes delivering actionable workforce data - and then communicate that linkage in a way that is understandable to management.

Visit Cathy's blog for more of her insight on strategic human resources management and HR metrics. You can also follow Cathy on Twitter.

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