At some point in your life, you’ve probably heard the expression, “the numbers don’t lie.” When it comes to the success of any human resources program, the only way to truly determine effectiveness is by using data to make informed decisions. Measuring certain metrics like retention rates can help you understand how well your organization’s HR department is functioning, as well as indicate ways in which it can be modified to maximize company performance. However, simply reviewing data alone is not enough. To get the most out of any data, you must understand how it can be used for the benefit of your human resources practices. Here are some tips to get you started:
Understand the difference between metrics and analytics.
According to the Society for Human Resource Management (SHRM), “HR metrics are operational measures, addressing how efficient, effective and impactful an organization’s HR practices are,” while “talent analytics, on the other hand, focus on decision points, guiding investment decisions that impact the workforce and related matters.” It’s critical to understand the defining difference between these two terms, as each one must be applied for different reasons. For example, metrics use data to evaluate factors like productivity or efficiency, while analytics can show connections between certain variables, such as employee performance and retention.
HR metrics have very little meaning if you do not establish any sort of objective for evaluating them. Before assessing any data, you should develop a strategy that points you in the direction of answering key questions, such as “Why has employee turnover in 2017 increased?” or “Why are the majority of employees who leave our company under the age of 30?” Narrowing in on some specific questions will allow you to more effectively use your data to focus on specific areas within your HR performance.
Evaluate metrics holistically.
Metrics alone cannot provide you with all the information you need to make sound decisions about your HR department. Rather than review metrics in isolation, make your data part of a comprehensive approach to view your HR department’s progress as a whole. You must look at HR results from a qualitative perspective, just as much as you would from a quantitative standpoint. For example, you may place just as much weight on employees’ personal feedback as you would on measurable factors like productivity outputs.
Utilizing HR metrics can add an entirely new value to the way in which you evaluate your hiring process and outcomes. Most importantly, you’ll be able to better support HR decisions with hard data and ensure you’re using both time and money in the best ways possible.
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