MEASURING HROctober – December 2011Kirloskar Institute of Advanced Management Studies, HARIHAR,PUNEArchita Panda Part – 2/3.

COVERAGE OF THIS COURSE

Evolution of HR as a function and Future/Present of HR

Integrated HR functions and HR Scorecard ROI for HR Services Approach to Measure HR HR Metrics and Cost estimation of HR

function HR Cost and Budgeting HR Accounting HR Audit

Covered in Part 1 of 3 part series

Being Covered in Part 2 of 3 part series (current one)

Will be covered in Part 3 of 3 part series

HR METRICS

COMMON ERRORS

Avoid building and executing HR metrics in Vacuum

Developing too many metrics than possible

VARIOUS METRICS

Functional Metrics Operational Measures Strategic Measure

FUNCTIONAL MEASURES

Provide employee efficiency Effective measures for Contribute to overall organization's

performance Essential for audit and accounting

Example : Leave consumption per employee, Training , number of accidents etc.

OPERATIONAL MEASURES

Track productivity and profitability Cover extensive measures of HR

effectiveness

Example: Profit per employee, Revenue per employee , Average employee cost etc.

STRATEGIC MEASURE

Match available capability against future need

Play prime part in central decision making Data can be tracked either top down or

bottom-up approach.( Expected vs. available skill set, Intellectual

capital , technology utilization )

HR METRICS FOR LARGE ORGANIZATION

Impact Effectiveness Efficiency

THREE KEY LEVELS OF METRICS

Boudreau and Ramstead

Effectiveness

Efficiency

THREE LEVELS OF METRICS

Impact

•What is the link between sustainable strategic success and human resource management?

•Which talent pools are most critical for competitive advantage?

•How could improving human capital increase value?

Impact

Source: Boudreau and Ramstead

Effectiveness

Efficiency

Impact

THREE LEVELS OF METRICSEfficiency

•What range of resources (financial and non-financial) should be considered?

•What is the appropriate level of investments?

•How should investable resources be allocated to maximize results?Source: Boudreau and Ramstead

Effectiveness

Efficiency

Impact

THREE LEVELS OF METRICSEffectiveness

•What unique combination of policies and practices would best build the necessary human capital?

•What factors link policies and practices to human capital enhancement?

•What attributes distinguish effective from ineffective policies and practices?

Source: Boudreau and Ramstead

Boudreau and Ramstead

OrganizationHR People

IMPACT

• Employee Satisfaction

• Turnover

Efficiency

• Time to Hire

• Cost per Hire

• Headcount Ratio

Effectiveness

• Customer Survey

• “At the Table”

• Practice/Process Impact

IMPACT

•Employee engagement

• Workforce skill level

Efficiency

• Direct Labor Costs

• Indirect Labor Costs

• Positions Unfilled

Effectiveness

• Employee Satisfaction

• Leadership Capability

• Talent Retention

• % Black Belt Leaders

• Employer Brand

IMPACT

•Productivity

• Quality

Efficiency

• Cost per Unit

• Defects/Scrap

Effectiveness

• Customer Satisfaction

• Revenue Growth

• Market Share

FIRST TIER METRICS

Workforce productivity Utilization of resources Money spend to increase employee productivity

Employee Engagement Index Recruiting

No of overall days for a vacant position The turnover rate for new hire ( Infant Attrition ) % of diversity hire Manager satisfaction with new hire

FIRST TIER METRICS

Retention Employee Turnover Performance Turnover ( High performer and low

performer turnover ) Preventable turnover in key jobs Diversity turnover Attrition Cost

Overall HR Cost Revenue Generated vs. Money spent in HR Cost

SECOND TIER METRICS

Compensation and Benefit Average employee cost vs. Revenue Generated % employee satisfied with pay and benefits

Employee Relation No of grievances received in quarter % grievances on compensation

Training & Development

Archita Panda

Email: architapanda@gmail.com

Mobile: 9850094074

Linkedin Profile: http://in.linkedin.com/pub/archita-panda/6/177/823

End of Part – 2/3.

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