Six HR metrics anyone can start tracking
The HR profession has been around for decades, but the use of data and analytics in HR is relatively new. While organizations are starting to incorporate metrics into their HR processes, it’s not always clear what the numbers are saying. In a 2017 survey, only thirty-seven percent of HR leaders agreed that they were using data to solve people management problems.
Namely, an HR software company aimed at mid-sized companies, wants to change this. In a guide titled Your Introduction to HR Metrics, Namely shares the top six HR metrics they believe organizations can use to make data-driven people decisions. Whether it’s to inform your next program or for your next meeting with key leaders, consider how your HR team can use these metrics to support your goals.
Turnover rate = (# voluntary and involuntary terminations ÷ average headcount) × 100. Not to be confused with attrition (another metric used to track employee departures), turnover looks at the number of employees who leave in a period of time with roles that the company intends to replace. This metric can be a useful indicator of your organizational culture, health, and finances.
Average time to fill = sum of all roles’ time to fill ÷ total # of openings filled. Knowing the length of time it takes to fill a position can help you assess the efficiency of your recruiting process.
HR-to-employee ratio = (HR team headcount ÷ full time employee headcount) × 100. The size of your HR group might vary depending on the overall size of your company — smaller companies invested in growth (and therefore need to hire a lot) will most likely have bigger HR teams relatively than larger companies. A high ratio can suggest your team is either over-specialized or technologically underserved, while a low ratio can indicate that your HR team is understaffed.
Career path ratio = total promotions ÷ (total transfers + total promotions). Although employee movement is multidirectional, many people fixate on promotion. This metric can help break out your various career ladders by measuring how many internal moves are promotions versus lateral transfers across different departments and specialties.
Revenue per employee = annual revenue ÷ full time employee headcount. Use this metric to determine how over or understaffed your organization might be by examining the growth of your revenue over time.
Employee net promoter score (eNPS) = % promoters - % detractors. Inspired by a survey used to gauge customer satisfaction, eNPS is used to understand employees’ overall engagement. Employers can annually survey their employees to calculate their eNPS. Using a 10 point scale on questions like “I would recommend my workplace to others”, employees with 9+ ratings are generally considered promoters, while those with ratings ranging from 0-6 and 7-8 are labeled as detractors and passive, respectively.
Check out the full guide here.
Tip: See how your metrics compare to the industry and national averages, and consider where you can leverage technology with your HR processes (e.g., applicant tracking system, employee engagement survey).