Human resources is transforming into so much more than simply a business function. Data is enabling HR to be a strategic partner in organizations.
“Data-driven insights are now uncovering issues, influencing organization decisions and investments, and driving continuous improvement within firms,” writes David Fineman, former leader of Deloitte’s Workforce Transformation People Analytics and Workforce Planning program. “While yesterday’s data was used to understand what was happening, HR measures are now allowing organizations to better understand why it is happening and provide input into predicting what could happen,” he explains.
HR departments are developing those insights by tracking and analyzing advanced HR transformation metrics focused on improving business outcomes. We look at some of these metrics below and why they are so valuable.
Quality of Hire Metrics
Quality of hire measures the value of a new employee to the company and provides insights into your hiring processes. This is an important part of ensuring that you are bringing the right people into the right roles. The data points used to determine this metric vary based on company goals, but some of the most common include performance reviews, retention rates, hiring manager satisfaction, and productivity.
Employee Turnover Predictions
Employee turnover can be very costly financially and limit the ability for an organization to meet its deadlines and goals. Being able to predict which hires have the greatest potential to leave allows the company to focus on retaining them. Some data points that define this metric are duration of employment, time since last promotion or raise, job performance rating, and commute time.
Inclusion and Diversity Metrics
Inclusion and diversity impact organizational success. In a McKinsey & Company 2018 report, the authors present multiple statistics demonstrating that more inclusive and diverse companies outperform those that are less so. Knowing this, companies are pouring resources into creating diverse workplaces. Tracking data points such as pay gaps, retention levels, diversity ratios, and career path ratios across all demographics will hold your company accountable to its inclusion and diversity efforts.
Employee Growth Rate Metrics
Business growth requires expanded teams. Strategic HR departments are measuring employee growth rates to better plan for that future growth. It can be used to show patterns in employee attrition and retention that allow the company to predict the future of talent acquisition needs.
Impact of Training Metrics
Employee learning and development is a big investment for employers who want to ensure their workforce has the skills they need to maximize their productivity. To measure the success of those programs and plan for future training needs, transformational HR teams track data points such as training efficiency, training effectiveness index, and the ROI of training programs.
Employee Engagement Metrics
Employee satisfaction is crucial to business success. If your workers aren’t happy, they aren’t going to give you their best effort and productivity will suffer. That’s why HR constantly measures employee engagement and satisfaction. Common data points used to measure how happy employees include Employee Net Promoter Score, employee satisfaction index, and absenteeism.
Strategic HR departments have moved beyond metrics that just improve their own processes. They are more focused on analyzing metrics and data that drives business decisions. By tracking key HR transformation metrics, they have become an invaluable part of an organization’s strategic team.
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