Human resources (HR) metrics are getting more and more attention in the mainstream business media. This is because HR metrics are of strategic importance to organizations, and HR metrics are a measure of how effective an organization’s human resources initiatives are. It is through HR metrics that an organization can see the impact of its people.
HR metrics can be valuable to any organization but have different purposes for different uses. Some metrics are meant to be used for small businesses to show progress. Other metrics are meant to be used by the human resources team to show how the business is using its talent. This can help you show the value of the business over time and make it easier to measure the success of your company’s initiatives.
Here are a few tips for using HR metrics strategically.
Understand the Role Metrics in Talent Analytics
Organizations are striving to be more effective and efficient at their work. However, when it comes to evaluating and improving human performance, it can often be hard to determine how to do so. The use of metrics is key to understanding what is happening, and how from a human resources perspective. Getting to grips with the role of metrics in talent analytics will help you to make the most of your HR data and empower you to create effective talent strategies.
First Understand the Question, Then Look at the Metrics
It’s not enough to simply gather data and then use it to make decisions. In order to come up with the best decisions, it is important to first understand the question you want to answer. If your goal is to determine whether your team’s performance is improving as it should, then you must define what “improving” means.
HR Metrics Alone Offer Only Limited Value
After years of seeing numbers that contradicted the business case they were trying to make, companies are now trying to make the numbers work for them. Companies need to start thinking about the business case as a ‘differentiator’ of the company, one that speaks in terms of business success.
Identify the Workforce-Driven Elements of Business-Driven Metrics
The focus of many businesses is to drive the business-driven metrics, but the responsibility of HR teams is to identify the workforce-driven components that make up these metrics. This might include the “input” into the process, such as data, people, and processes, but also the “output” of the process, such as performance measures, employee satisfaction, and other business metrics. As an HR person, you might have a different way of solving problems, but at the end of the day, your goal is to support the business and give it what it needs to be successful.
Embrace Measurement
HR professionals are generally obsessed with metrics. Quantifying and analyzing people metrics is a cornerstone of work. Before we can measure people, we need to measure the behaviors that will lead to desired outcomes. We need to gather data that gives us insight into people, and we need to be able to analyze the data to identify trends and to make better decisions.
Conclusion
The most important part of using HR metrics strategically is being thoughtful in choosing what to measure, knowing what you want your HR program to accomplish, and then using that data to inform meaningful changes in your HR department. As long as you are purposeful in your efforts to measure the right things, you can use analytics to improve the metrics and to see how the HR metrics serve as a great way for organizations to measure their human capital.
