HR Metrics to Follow / Implement in 2019
Human resources (HR) consist of much more than just recruiting, which is why it’s so important to measure each and every aspect of its processes. The whole industry is evolving and constantly coming up with new HR trends, so you definitely need to keep an eye on all parameters, from talent acquisition to development and performance management.
However, it is by no means easy to monitor every performance indicator simultaneously. It requires thorough preparations and the all-encompassing HR strategy if you want to keep everything under control. Our goal is to make your job simpler by presenting HR metrics to follow in 2019.
Why You Need to Implement State of the Art HR Trends
Before we move on to the 10 most important HR indicators, we want to explain what makes this process so critical to the success of your organization. To cut the long story short, you have to follow key HR metrics because:
- Only 20% of employees strongly agree that their performance is managed in a way that motivates them to do outstanding work.
- Increasing employee engagement investments by 10% can increase profits by $2,400 per employee, per year.
- More than 80% of employers believe attracting and retaining talent is a growing challenge.
- Almost half of the HR leaders say employee burnout is responsible for up to half of their annual workforce turnover.
- 45% of companies are still in the early stages of basic HR automation.
Key HR Indicators to Look After
It is clear that HR managers have to be very careful and skilled if they want to improve the functioning of their organizations. There are all sorts of aspects to analyze here, but 10 metrics are more important than the rest. Without further ado, let’s check out these KPIs.
1️⃣ Time to fill a position
The average time it takes you to fill a position is actually a total of days all positions are open divided by the total number of positions. Calculating this number, you gain insights into HR performance in terms of employment brand, recruiting process complexity, and marketing. Longer duration usually suggests your talent acquisition system has too many touchpoints, meetings, and interviews.
2️⃣ Time to productivity
This metric may not be as precise as the first one, but it’s sometimes even more important. Time to productivity is the average period needed for newly hired employees to reach the targeted level of work efficiency. HR managers at HR metrics use this metric because it tells a lot about their onboarding processes: “At the same time, it is often a key indicator that reveals the quality of new employees.”
3️⃣ Turnover rate
Turnover rate is a numeric value that shows how quickly your employees are leaving the company. For instance, the annual turnover rate represents the number of departures divided by the total headcount in the last 12 months.
The KPI is particularly relevant when combined with other features. For instance, you can see turnover rates for specific worker groups such as underperformers, Millennials, mid-level managers, etc.
4️⃣ Cost per hire
It takes a certain amount of money to recruit a new member of the team. You need to evaluate these costs by dividing all costs by the new employee total. These expenditures include items like job announcement spend, HR fees, possible relocation costs, and all other budget-waste that may occur in the process. Jack Stewart, a recruiter at UK CareersBooster, shares a little secret with us: “If you outsource HR and see the spending increases, perhaps it is time to consider forming an internal recruiting team.”
5️⃣ Acceptance rate
Another indicator of a recruiting team’s performance is the so-called acceptance rate. To put it simply, it’s the percentage of candidates who accept a formal offer to work for you. If you notice that too many candidates reject your proposals, you need to reconsider compensation packages, improve the overall candidate experience, or think about introducing an extra package of work/life benefits.
This metric is supposed to show you the readiness of the company to implement the business plan. It is focused on senior management, so you don’t have to waste time analyzing lower levels of the business hierarchy.
You need to divide open positions by the total number of positions in your team (to get result A). Then you also divide the number of employees who have the desired skill set to execute the business strategy by the number of workers who have received a competency assessment (to get result B). After that, you just need to do this: AxBx100.
7️⃣ Learning participation rate
Learning participation rate represents the percentage of workers who take part in professional courses and training sessions. Our fellow colleagues at Superiorpapers say that learning participation rates are directly related to employee engagement, adding that they can also reveal flaws in the internal communication strategy or training quality.
8️⃣ Performance rating
HR teams administering larger employee groups can use performance rating to assess the average efficiency within the organization. It is simply a sum of all individual performance ratings divided by the total number of employees. It can hardly discover smaller imperfections in your team, but it gives you a nice overview on a grand scale.
9️⃣ Benefit plans
You can also choose to measure the percentage of employees taking part in a specific benefit plan. Once again, it’s a number of workers joining the program divided by the number of eligible colleagues. In case you realize that only a speck of employees takes advantage of certain benefit plans, you might as well halt the program to cut costs and redirect users to another benefit package.
1️⃣0️⃣ Engagement rate
The last KPI on our list is usually analyzed on the smallest of scales, identifying the engagement rate of individual workers. The way you calculate it depends mostly on the peculiarities of your business, but you can definitely organize a comprehensive survey to give you a better insight into workers’ engagement habits.
HR is getting harder and more complex year after year. You need to implement the latest HR metrics to stay up to date and follow the latest trends if you want to maintain the highest level of professionalism long-term. However, some performance indicators are more important than others, so we decided to show you 10 HR metrics to implement in 2019. The list can slightly change depending on the peculiarities of your business, but it definitely represents a quality manual for modern recruiters.
Tom Jager is a professional blogger based in London. He covers topics related to digital marketing, blogging, social media and business in general. He is always seeking to discover new ways for professional and personal growth.
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