Measuring results that show HR’s impact on the business
Putting together a case for implementing or upgrading a Human Resource Information System (including any type of process automation) must start with understanding the value and ROI that HR brings to the organization, which is often articulated in metrics.
But too often these metrics – and this is applicable to other organizations besides HR – measure the volume of work or degree of effort, rather than focusing on results that help drive the business. This series of (4) blogs about HR and process management will focus on developing meaningful metrics for HR that will help you determine HR’s impact on your organization, and on identifying tools that help address any gaps you may uncover.
In the past, many HR measurements have been largely administrative in nature. Examples include:
- Absenteeism rates
- Benefit costs
- Costs per hire
- Time to fill an open position
- Employee satisfaction ratings
- Number of new hires
- Training hours
- Turnover
- Workers’ compensation incident rate
This is not to say this information isn’t important, but HR often has very little control over the outcome of these measurements, other than collecting the data. Wouldn’t it be more meaningful to measure the degree of satisfaction HR’s internal and external customers have for it? This doesn’t mean that HR is responsible for keeping employees happy. It does mean that HR specifically identifies its internal and external customers – then goes through a process of identifying measurements of customer satisfaction that determine success.
Depending on your organization, potential HR customers include:
- Hiring managers
- Potential outside applicants
- Company executive team
- Current employees
Working to understand the goals and priorities of its customers, HR then develops its own goals and metrics that drive the success of its customers.
Future blogs in this series will describe how HR can play a vital role in helping its customers reach their objectives, and how technology can streamline the processes for making this happen. Come join the discussion on this topic on the BPM Guru LinkedIn Group.
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