HR metrics are indicators that are used to ascertain the strengths and weaknesses of an enterprise. In my previous blog, Top talent metrics that HR managers and CHROs must keep a track of – Part 1 we learnt that not all HR metrics are created equal. There are an endless array of talent metrics covering aspects like performance, retention, training, payroll, engagement, recruitment etc.   But, some measurements are more important than others as they cover strategic goals like productivity, innovation and revenue growth.

In the part 1 of this blog, we covered the best recruitment related metrics that impact strategic goals. As a company is only as good as the talent behind it, consistently and accurately evaluating some important employee performance metrics is essential not only to individual success, but to the overall success of an organization.

In this blog, we will cover some important business performance and employee performance metrics that HR Managers and CHROs must track

What are the best performance metrics that you must track for improving your business?


Percentage of talent goals that were met

All business functions must meet their strategic goals. The role of the HR team is to present a report on the percentage of goals exceeded, met and unmet for all the business units in an organization.

Revenue per employee

This is the most effective way of measuring the performance and innovation output of your employees. CFOs and other leaders will be interested to know this. The formula is a no brainer. Just divide the revenue of your business by the total number of employees in your organization. You can also assess how your competition is doing. Just check your RPE against your competition. Revenue is a publicly available information. If it is lesser than that of your competition you will know that you must improve your bottom-line. If it is better, keep improving.

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.

Performance and potential

Most organizations use the 9-box grid to assess the top performers in the organization. The 9-box grid maps the performance and potential in three levels. This gives you a clearer picture of your workforce. For instance, who overperforms, who underperforms, who has immense potential. You can identify wanted and unwanted turnover.

Employee engagement rating

Engaged employees outperform employees who have bad managers. Engaged employees are more productive and generate more revenue. It is a very important metric for assessing all your team managers.

Effectiveness of a HR software

When an investment is made on a HR software, the business leaders would like to know about the ROI i.e. increasing productivity. For instance, a learning and development module in your HCM solution can help you by providing metrics like active users, time spent on the platform, screen flow etc. You can determine what works for your people and device programs accordingly.

HR programs that increased productivity

You can determine the impact of the HR programs like training, onboarding etc. by surveying managers and employees. Ask the managers the HR program that contributed to their reaching their productivity goals.

Learning performance index

LPI is the most important and consistent survey that HR Managers swear by. The survey measures organizational performance on five dimensions: Vision, Infrastructure, Culture, Learning Dynamics, and Training Investment. These dimensions, based on solid research, make up the critical elements characteristic of a learning organization. Rate your employees on these five dimensions and produce a report based on the hours spent on learning. This can be done using the performance management module in your HCM solution.



Performance metrics aligned with corporate goals highlight areas of excellence or those in need of improvement. There are several Human Capital Management systems that will help you to track various HR metrics, like the ones listed above.

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