There are numerous HR publications that list a plethora of metrics that a HR department must track. But, are they ‘HR Metrics that Matter’?
What differentiates ‘HR Metrics that Matter’ with other nice to have HR metrics?
The answer is very simple! The metrics that cover strategic goals like productivity, innovation and revenue growth. Keeping tabs on strategic metrics gives you a clearer picture of how your business is doing in terms of talent management.
I am going to walk you through the best recruitment related metrics in the first part of this blog.
What are the best recruitment metrics that you must track for improving your business?
Quality of hire improvement
When you make new hires and if they are better than their precedents it is evident that productivity of the team will improve. Work with your CFO to ascertain the increase in revenue because of hiring better performing and driven employees.
Cost per hire
Cost per hire (CPH) includes all the costs like advertising fees, vendor costs, travel expenses for scouting, incentives to employees for referrals, internal recruiter costs etc. divided by the total hires made by your company. It is important to analyse this metric as the CPH differs for different positions in any company.
Time to hire
Time to hire tracks the speed in which a potential candidate move through your hiring process once they have been sourced. It is an efficiency metric that gives you the clearest picture of how the recruiting team is performing. All this can easily be tracked using the recruitment module in a HCM solution.
Source of hire
Tracking the source of hires with the help of Application Tracking Systems(ATS) will give your recruiters insights about the strongest and weakest source. Keeping this data on your fingertips will help you to modify your team’s priorities and cost to ensure the best possible ROI for your business.
Turnover or Attrition rate refers to the percentage of employees who leave the organization. High turnover can be a costly deal for your business because employees must be replaced frequently. Filling open positions can have negative effects on your revenue and productivity. Companies must strive to avoid high turnover rates.
Diversity hires include diverse thinkers and international hires. Diversity hires, especially in client facing positions can be a huge plus. If your employees reflect the diversity of your customers, your services will sell better.
Revenue lost due to vacant positions
When an employee quits or there is an unfilled position, there is a drop in productivity and revenue. Just calculate the loss per day by dividing the average yearly revenue generated by the employee by the number of working days. Report the decrease in vacancy days and the reduction in the amount of lost revenue due to slow hiring and job dissatisfaction.
Optimized decision-making is key to achieving business goals. Having a HR technology solution like Human Capital Management help HR managers by providing HR data like the ones listed above that optimizes decision making.
HR managers and other decision makers need the analytics that can help to
Watch this space for 'Top talent metrics that HR managers and CHROs must keep a track of' – Part 2