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3 Ways to Use HR Metrics to Create Positive Change

March 27, 2018

hr metrics for positive change

Overall employee turnover, early turnover, time to fill, quality of hire, candidate experience, cost per hire, time till promotion, engagement rating, absenteeism, training spent per employee, diversity/EEOC, healthcare cost per employee, hiring manager satisfaction, selection ratio...these are just some of the metrics to be tracked in the world of Human Resources.

Obviously, most companies have implemented a system to measure these and/or other HR metrics. While these organizations might be using these metrics to set goals, many companies do not have the crucial, candid conversations to find out if the metrics they are using are in fact the right ones to be tracking for their goals. Here are three things to consider when determining which metrics to track and how to use them most effectively:

1. Think Before You Jump.

Before you jump in and start delivering reports and presentations of your results, it is vital to understand what metrics are and how they differ from other measurement tools. In a 2017 SHRM article, Alexis Fink, an Intel general manager of talent intelligence and analytics, said, “HR metrics are operational measures, addressing how efficient, effective and impactful an organization’s HR practices are. Talent analytics, on the other hand, focus on decision points, guiding investment decisions.” So basically, metrics tell you what is currently going on and talent analytics focus on what needs to be done. Once you understand the metrics, you can bring your problems to the table.

2. Discover the Real Issue.

In HR, a lot of time is spent discovering what the problem is. Far too often, people come together and conclude what the problem is without first discovering the real root of the issue. For example, your company may have seen an issue with turnover and therefore concluded that you were selecting the wrong employees. This could be true. It could also be true that the selection process is fine but the company culture is what's causing employees to be disengaged and leave the organization due to lack of job satisfaction. These individuals could be top performers, but your company is unable to retain them with its current culture. Read more about why turnover reduction is a complex (but achievable) goal. This is just one scenario. There are many other factors that could play a role in high turnover:

  • Management

  • Salary and benefits

  • Co-workers

  • Location

  • Work-life balance

Spend time asking the tough “why questions” that will lead to candid conversations to discover the real issue. It is important to get the point of view from everything that is involved with the problem. There are usually angles of an issue that are only discovered through the unique perspectives of employees from diverse teams and departments. Once the true issue is discovered, you can put a plan in place to use the most relevant HR metrics to track future predictors of turnover. 

3. Silver Bullets Don’t Exist.

As we know, there usually isn't one sole solution to organizational HR dilemmas. Generally, there are several facets to these kinds of issues. They are complex. Therefore, the solution is rarely a quick and easy fix. Be cautious of anyone selling these types of solutions. The most successful solutions will use strategies with HR metrics, talent analytics, and more. Going back to the turnover example, it will not be sufficient to simply measure the turnover – but there needs to be diverse approaches taken to discover the root cause and then decrease turnover. These approaches might include a review of the following:

Check back in with those vital metrics to see what progress is being made. It’s also important to review metrics at different time intervals to find out what kind of trends are showing up.

The numerous HR metrics all serve a purpose if they are understood and used properly. The metrics will be much more effective if you use them to measure and monitor the real issue. Don’t expect one metric to cover it all, and don’t expect metrics to be the only solution. Finally, when metrics are understood, measure the true problem, and used in a multi-tool approach, there is a much better chance for creating positive change and long-lasting results.

HR Analytics

Trevor McGlochlin Trevor McGlochlin is a Research Analyst at PSI. He earned a Master of Science degree in Industrial and Organizational Psychology from Florida Institute of Technology. His areas of expertise include selection, employee turnover, organizational development, applied research, and statistical analyses. His analysis work is centered around validation, adverse impact, turnover analyses, assessment scoring, and other data analysis.