There are many complexities to delivering leading-edge workforce analytics. You need to understand data sources, develop reports and dashboards, and manage all of the complexities of getting the right information, to the right people. However, all of this effort is wasted if you do not focus right from the start on the core purpose of your workforce analytics program.
The reason to undertake a workforce analytics initiative is to improve the decisions made about people, and to track the impacts people have on the business. Better, quicker, and more informed decisions about your workforce, and the people who make your organization successful, will bring about a substantial financial return. Ensuring that your analytics solution delivers true insight to the business leaders and managers who are making these complex people decisions, is the key to success.
To deliver a “best-in-class” analytics solution to your organization, there are two important decisions that need to be made. Getting these decisions right means that the money you invest in applications and resources will be targeted towards the right outcomes, and will lead to better people decisions, which, in turn, will lead to better business results in the form of increased revenue and / or profitability.
1. What to Measure
The most common mistake made by HR organizations when they start building their workforce analytics program, is starting with a blank sheet of paper and generating a list of all the HR metrics they think could be useful to measure. These lists become lengthy and contain many great ideas; however, the data required to deliver the anticipated insight is frequently not available. The crucial missing step, when starting with a blank sheet of paper, is that the metrics chosen are not necessarily linked directly to the company’s overall goals and strategy.
To be strategically aligned and deliver value to executive leaders, the metrics and insight delivered must link closely to the overall strategy and direction of the business. The decision about what to measure flows from a detailed understanding of the top-level key performance business measures. From there, HR can determine which programs and activities most impact these goals and what measures best demonstrate the impact achieved.
For example, an organization that is looking to grow needs to keep a close eye on vacancy rate. There is a negative impact to business results from resignations, however, when the goal is to grow, the negative impact of vacant positions is even greater. Therefore, it is crucial to know how many positions are vacant, what types of positions are vacant and the duration of the vacancies. It is even more important to be able to explain to your executives how the strategic linkage between vacant positions and business results works and how this should shape their decision-making for talent management.
Deciding which HR metrics to measure is the foundation of your entire analytics program. To ensure you positively impact your organization’s business results, you must align to the organization’s strategic goals. HR leaders do this by being able to describe how each HR measure links back to one or more of the key performance indicators, that your executive team regularly monitors. It is also better to start with a limited number of HR measures and demonstrate your effectiveness, rather than to try and deliver everything all at once.
We will cover How to Measure? in the next post....
From HR Metrics to Workforce Analytics: Five Key Workforce Insights That Every Employer Should Capture for Greater Business Impact
The reality is that the most commonly measured workforce metrics do very little to help HR professionals and business leaders achieve real insight into maximizing their human capital investment. To make better business decisions regarding their workforce, leaders need to see the connections in their workforce data and examine comprehensive workforce topics.
In order to achieve true business impact, employers should be measuring 5 critical performance indicators:
1. Critical Talent Retention
2. Recruiting Effectiveness
3. Productivity
4. Compensation and Pay Equity
5. Performance Management
Download this white paper and discover how to:
- Measure what matters most. Uncover real insights about your workforce, and drive the necessary changes, that will keep your organization competitive and successful.
- Make the connection between related HR metrics, in order to see “the big picture.” Help understand the contributing factors and drivers about your workforce, in order to create more effective actions plans.
- Stop collecting individual and unrelated workforce metrics. Start measuring powerful workforce analytics to improve performance and profitability.
Download White Paper Today!
