One of the more common questions I get as a human capital management analyst is what metrics to include in a dashboard. This was also the source of a robust discussion I had recently with a number of high-level HR professionals, and between the Brandon Hall Group data and their experiences, a series of commonalities arose.
Data governance takes precedence over any discussion of “which metrics to include”
Consistent data that is true across the organization, it is impossible to get to the “single source of truth” ideal. In Brandon Hall Group’s 2016 HCM Measurement and Analytics survey, HR data not being integrated with other systems was listed as the #2 barrier to becoming a more analytically-driven organization (34% of respondents), and inconsistent data was the third highest listed barrier (28%).
HR metrics on the dashboard must directly relate to corporate strategy
Part of the skill of modern HR leadership is aligning people practices in a way that best promotes the overall business strategy. Work directly with business leaders to determine the outcomes that are of most value to them, and help them to understand the people metrics that tie to those values.
Validate your metrics
Your data will be questioned. Make sure that you are clear that what is being measured is a true reflection of the reality, and related to other business variables. Some of this is part of data governance (above) — having consistent data definitions and secure information systems — but some is in checking if the metrics are indicative of operational outcomes. For example, is voluntary turnover a consequence of higher production levels, managerial influence, or macro employment trends?
Decide on a mix of metrics that is both descriptive and predictive
It is just as important for an organization to know where it stands at any given moment as it is to predict where it will be standing in six months.
Some example dashboard metrics that were popular in the discussion included:
- Hires/internal movements/exits
- Resignation rate (voluntary turnover – retirement)
- Customer metrics
- Net income/FTE (net income divided by number of full time employees)
With any metric, it is important to benchmark to determine how you stand against your particular industry, but also where you stand compared with varying growth models. It is also important to have a repository of other metrics that you track that may not appear on your standard dashboard but could be produced at a moment’s notice depending on business need.
One thing is clear from Brandon Hall Group’s research: although the appetite for data, and decisions made with data, is very high, organizations still are not allocating resources to that end as quickly as their need would seem to dictate. In fact, 71% of organizations from our HCM Measurement and Analytics survey responded that they had no dedicated measurement and analytics experts in their organization. Oh, and the number one barrier to creating a more analytically driven organization mentioned above? Lack of funding/budget (49%).
So for those of us in the HCM profession, it will require some effort to learn as we go, rely on research (such as Brandon Hall Group’s) and experts such as these contributors to make the best possible use of our organization’s people data.
Contributors to this post include Aaron Ziff, Alcoa; Jason Chavarry, UTC; Brian ; Mark Van Clieaf, Organizational Capital Partners; Manoj Kumar, HSBC; Anwar Shammari, SABIC; Gavin Thomson, Sidra; Max Blumberg; Maarten Oostenbrug. The views reflected in this piece are not necessarily the views of any of the contributors.