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Metrics 101

metrics-300This post was contributed by Ed Doyle, associate director of human resources at The University of New England, who presented a session on HR metrics at the CUPA-HR Eastern Region Conference earlier this month.

How is human resources perceived in your organization? Are you a valued business partner included in strategic decisions and institutional initiatives? Or are you seen as just another cost center, a necessary evil, a transaction-focused “fire-putter-outer”? Unfortunately, many stakeholders in many organizations still hold onto that outdated, unfair, unrealistic perception of human resources. So how can we get past these perceptions and prove our value to our leaders, our constituents, our customers and our organizations? With metrics, that’s how!

What Should We Report?
The more hard data you can produce, the better. At the very least, your HR organization should be gathering metrics on:

Workforce Demographics

  • Age of employees
  • Length of service
  • Diversity
  • Gender distribution
  • Home zip code
  • Employees by location

Compensation

  • Average hourly wage
  • Comp ratio
  • Range location
  • Average annual increase
  • Replacement wages
  • Overtime usage

Turnover/Retention

  • Open positions
  • Average days to fill
  • Average cost to fill
  • First-year turnover
  • Applicant count
  • Positions filled (YTD/Rolling 12 Months)

Benefits

  • Benefits eligible employee count
  • Health plan participation
  • Actuarial values
  • Cost increase trends vs. comp data
  • Enrollment by group (i.e. EE-only, Family, etc.)
  • Participation analysis trends for every plan offered

Seasonal/Time-Specific Metrics

  • Open enrollment
  • Annual merit/cost-of-living adjustments
  • Performance appraisals completed
  • Total comp statements
  • Fiscal year vacation time used if “use it or lose it”
  • Federal/state requirements
  • ACA look-back periods

Other Metrics

  • Employee relations
  • Leave tracking
  • Attendance tracking
  • Admin/staff to faculty ratio
  • HR to FTE ratio
  • FMLA data (open leaves, average time away, etc.)
  • Workers’ comp data (# of claims, average cost per claim, etc.)
  • And the list goes on (there’s almost no limit to what you can report through metrics!)

How Can We Use This Data to Help Make Business Decisions?
So you’ve gathered your data and reported it, but that’s not enough. The key to metrics is to make them relatable to your particular audience and to provide illumination. Raw data is not enough. We need to answer the business “whys,” and a great way to do this is to present both trend data and comparison data.

Trend Data
Trend analysis allows decision makers to understand a sense of urgency. Trends are difficult to ignore and help answer the “so what?” questions. And trends often get attention faster than static data. For example, if you report that “Annualized turnover in February was 10.6%.” The response you get may be “OK. So what?” But if you report that “Annualized turnover in February was 10.6%. That’s up 2.1% over this time last year.” The response suddenly becomes, “That’s interesting … I wonder why that is.” (Which will likely lead to a sense of urgency in answering that question!)

Comparison Data
Comparison data paints the “big picture” and can quickly identify potential issues. (Example: “Annualized turnover in February was 22.4%. That’s 8.3% higher than the national average for like-sized universities.”)

Putting It All Together
When and how should you report out on metrics? That depends. Some metrics will need to be reported regularly (monthly/quarterly/annually). Some will be project-oriented. Others might be needed on-demand (and what a great way for HR to contribute to strategic discussions – by having valuable metrics at the ready when senior leadership asks for them!). Always make sure to present the data in a way that makes it easy for your audience to understand (start with a summary but provide detail if your reader wants it).

Why Metrics Matter
When metrics support what we do, HR is looked at as a legitimate business partner. Our credibility increases, we can prove that we understand the mission of the institution and how we support that mission, HR processes are improved, and needed capital and hiring decisions are more easily supported. Good metrics can lead to a need for more detailed analysis, which can lead to even more improvement.

The bottom line is – if you think it’s important, prove it!

Looking to ramp up your metrics? Check out the Metrics Toolkit in the CUPA-HR Knowledge Center for how-tos, readings and other resources.

 

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