Guide: Identify and define your metrics

Introduction

The clothing retailer Gap Inc. wanted to empower their human resource business partners with greater analytical tools so they could perform self-serve, consistent reporting across their different brands — Banana Republic, Old Navy, Gap, Athleta, and Intermix.

To fully meet the needs of their HR partners and the business, Gap Inc.'s Workforce Analytics team first had to map out the primary issues that needed to be addressed:

Inconsistent processes and data: Decentralization across brands meant each team was performing unique calculations to determine metrics like turnover. In addition, data was not fully integrated globally into the system of record, which made reporting incomplete.

Lack of analytics tool usage: Many HR partners weren’t even aware they had access to workforce analytics, so it was difficult to make data-driven talent decisions.

Little executive exposure or support: Since leaders weren’t receiving much workforce data from HR partners, they weren’t seeing its benefits, couldn’t discuss its implications in a common language, and ultimately weren’t taking action on the data.

Analysts were seen as “order-takers”, not strategic partners: The inability to automate workforce data insights left little time for analysts to work on high-impact research projects.

Guide: Identify and define your metrics

Build analytical credibility

Once the Workforce Analytics team understood the gaps to being a truly data-driven HR function, it began a journey to close those gaps through:

A multi-year effort to standardize the data: The Workforce Analytics team – with partners from IT and system administration -- dedicated resources to investigate the accuracy and completeness of its data. This was a multi-year program to remedy data issues, establish governance standards, and create a central data warehouse. Clean and reliable data was critical for Gap Inc. to built its analytics credibility.

The establishment of a workforce analytics training program: Once the data standardization project was complete, the team was ready to use its analytics tool with the broader HR community. They developed a seven-session training program that covered topics such as building queries, recurring reports (i.e., dashboards), and general analytics topics (e.g., how to interpret results). Sessions were an hour-long and spread out over several months to provide bite-size bits of information for HR teams with high workloads.

The development of a grassroots community: The team also created a grassroots community of trained HR employees who use the tool regularly to build and pull reports. These power users were well-aligned on metric definitions, shared success stories and lessons learned, and helped break down silos across the brands and divisions.

Guide: Identify and define your metrics

Train business partners

The Gap Inc. workforce analytics training program has helped create a culture of data-based decision making across the entire HR function.

Here are some of the changes they’ve seen:

  • An increase in workforce analytics tool users from single-digits to over 200
  • Increased leadership exposure to workforce data, leading to a desire for recurring reporting and workforce insights all the way up to the Board of Directors
  • A common language and set of definitions for the majority of workforce metrics across all brands and divisions, and ubiquitous adoption of the workforce analytics tool as the source of record for HR metrics
  • An increased interest in workforce analytics thanks to power-users teaching their business partners the value of the people data and ways to take action
  • More time for analysts to think strategically instead of manually pulling data

Through these trainings, the Workforce Analytics team and its business partners have set the foundation for more evidence-based, data-informed decisions in HR. This is just the beginning -- the team has much more planned in its analytics training strategy.

Guide: Identify and define your metrics

Measure inputs to determine results

In their training, the Gap Inc. Workforce Analytics team highlights the two keys parts to any analytics metric:

  1. Input: The raw data points from a defined time period across a defined organization (e.g., the number of new hires, or the number of employees who have left company)
  2. Result: This is usually a ratio calculated using at least two inputs (#new hires/#total employees, % of people leaving the company)

The team created a consistent set of data and analytics methodologies which simplified reporting, benchmarking, and tracking. They accomplished this by agreeing internally on how inputs are measured and collected, and by defining how results should be calculated.

Guide: Identify and define your metrics

Collect pre-offer hiring metrics

Pre-offer staffing metrics help Gap Inc. understand how its organization is attracting candidates, see where candidates might be getting lost in the process, and demonstrate the efficacy of recruiting and selection efforts overall. Gap Inc. recruiters use these metrics to identify hard-to-fill roles that either attract a low number of candidates or sit open for long periods of time.

Inputs

  • number of applications per role
  • number of initial phone screens
  • number of on-site interviews
  • number of job offers extended
  • number job offers accepted

Results

  • Percentage of candidates moving from online application to phone screen = number of phone screens / number of applicants
  • Percentage of candidates moving from phone screen to onsite interview = number of onsite interviews / number of phone screens
  • Percentage of job offers accepted = number of job offers accepted / total number of job offers extended
Guide: Identify and define your metrics

Collect hiring metrics

Hiring metrics compared from year to year allow Gap Inc. to look for trends and cycles in hiring as compared to competitors, company performance, market conditions, and more. Hiring goals can be closely monitored for certain job functions by taking into account historical turnover trends and plans for expansion.

Inputs

  • Number of external hires
  • Number of entry-level hires
  • Number of intern hires
  • Number of industry hires
  • Number of rehires
  • Number employee referral hires

Results

  • Percentage of new hires who are entry-level hires = number of entry-level hires / total number of hires
  • Percentage of hires from intern program = number of intern hires / total number of interns
Guide: Identify and define your metrics

Collect exit metrics

Exit, or termination, metrics help you understand why people leave an organization. Conducting an exit interview is a great way to gather data to calculate exit metrics. Gap Inc. uses exit interviews to understand why employees leave, when in their careers they exit, and where they’re going. This can help identify areas within the organization that are experiencing high turnover and determine if there are particular cohorts, employee demographics, or reasons for leaving that drive this trend. These insights can inform how retention strategies could be crafted.

Inputs

  • Number of voluntary exits, or terminations
  • Number of retirements
  • Number of employees leaving to pursue new job
  • Number of employees leaving to pursue further education
  • Number of involuntary exits, or terminations

Results

  • Employee turnover = number of total exits / total number of employees
  • Retention rate = ((total number of employees - number total exits) / (total number of employees))
Guide: Identify and define your metrics

Collect demographic metrics

Demographic metrics are useful for supporting a diverse workforce. They can also guide efforts around affinity groups, mentorship programs, and knowledge management processes. The Gap Inc. uses demographic mentions to focus retention and hiring strategies.

Inputs

  • number of employees by ethnicity
  • number of employees by gender
  • number of employees by age
  • number of employees by tenure
  • number of employees by organizational level

Results

  • percentage of employees by ethnicity = number of employees by ethnicity / total number of employees
  • percentage of millennial employees = number of millennial employees / total number of employees
  • average company tenure = total workforce tenure / total workforce headcount
  • percentage of management employees = total number of managers / total workforce headcount
Guide: Identify and define your metrics

Collect internal mobility metrics

Internal mobility metrics highlight how employees move around an organization, across groups and up career ladders. You may find “roadblocks” in a ladder where employees get stuck (e.g., do not advance further). Gap Inc. looks to determine whether there are certain functions or leaders that excel in preparing their teams for career advancement, and looks for areas that may be more stagnant due to low turnover and limited advancement opportunities.

Inputs

  • number of promotions
  • date of promotion
  • number of demotions
  • number of horizontal moves
  • number of transfers between departments

Results

  • time to promotion = date of promotion - start date in role
  • average promotion rate = number of employees promoted / total number of employees
  • percentage of transfers to department = number of transfers to department / total number of transfers between departments
Guide: Identify and define your metrics

Collect learning and development metrics

Learning and development metrics measure the hours, volume, type, and effectiveness of internal training courses. Gap Inc. measures whether certain employee populations are receiving more frequent or faster promotions as a result of completing particular internal development or leadership-readiness training courses.

Inputs

  • Training hours per employee
  • Training hours per course
  • Number of employees participating in a course
  • Number of courses
  • Number of scheduled offerings per course per seat available

Results

  • Course participation rate = number of employees participating in a course / total number of course offerings per seats available
  • Average training hours per employee = total number of training per employee / total number of employees
  • Total number of training hours offered = training hours per course x number of scheduled offerings per course per seat available
Guide: Identify and define your metrics

Move from reporting to forecasting

The Gap Inc. Workforce Analytics team looks to continue building analytics capability and data-driven methodologies across the entire HR organization. For certain groups, they hope to focus on more predictive analytics, such as forecasting turnover or proactive assessments of top talent.

Storytelling with data is another area of focus for the Workforce Analytics team. This often involves weaving together disparate pieces of information (both qualitative and quantitative) to provide a comprehensive understanding of organizational talent.

Data visualization techniques are a future topic of interest for training. The need to clearly present trends in charts, infographics, or other formats is critical for driving action and maintaining the interest of the audience.