Leoron logo

Shopping cart

CLOSE

Total:

AED 18.300

The Practical Guide To HR Optimization: A Series (Part 6)

Posted by

Leoron press service

Category

BLOG

Date

June 21, 2020

The HR And Admin KPI Cheat Sheet: 29 Most Important HR Metrics

 

Due to the high demand for this topic, we have prepared a brief ‘cheat sheet’ with some of HR’s most important metrics.

The list includes short definitions as well as the manner of representation and calculating each metric.

It goes without saying that it is easier if you have a software system set in place.

Feel free to drop us a line or directly contact our consultants for the more complex and strategic KPIs

  1. Employee Efficiency

Utterly complex concept this not as easily measurable.  It evaluates how efficiently your employees are producing an output. It can be calculated in terms of employee productivity or total sales productivity.

How is it calculated?

Productivity = Output / Hours Worked
Productivity = Output / Input.
Productivity = Value of Work / Hours Worked.


'Output' can be measured in units, whereas 'Value of Work' is typically measured in dollars. 'Input' is mostly measured in number of worked hours.

  1. Employee Engagement Level

Is a multi-item measurement which evaluates to what extent are your employees engaged in their roles. It changes depending on your priorities, and it can depend on various metrics such as: loyalty, recognition, strategy clarity, contribution, learning, extra effort etc.

How is it calculated?

Via survey data.

  1. Employee Satisfaction Index

Is a complex metric item that evaluates your team’s level of satisfaction in regards to their role. Considering organizational priorities, it can include measures such as: management and leadership, career growth, training and development, your culture, compensation and benefits, etc. It is considered critical since a motivated team is more likely to deliver satisfaction to customers and drive successful business performance. It is generally calculated via a satisfaction survey, based upon a selection of key areas which combine to represent the overall experience of your team. Your employees can score answers to questions with Strongly disagree (score 1) to Strongly agree (Score 5).

How is it calculated?

Via Survey Questions
Employee Satisfaction Index (%) = (Total point score divided by total questions) x 100

  1. Training Effectiveness

It refers to the quality of the training and measuring whether it met its goals and objectives. The three most widely used models for measuring training effectiveness are the: the Kirkpatrick taxonomy, Phillips' ROI Methodology, and Stufflebeam Model. The common traits which are measured are: pre- and post- training assessment or test scores, evaluation of applied knowledge, improvement in performance shown in specific KPIs, earning a certification (passing an exam), report and feedback from the employee direct manager, etc. Training ROI is a measurement of the return ('the value') your organization receives from providing training to your employees. It is usually measured using a multi-scale approach to cover different benefit levels.

How is it calculated?

Surveys data, Exams, Tests, Feedback from relevant stakeholders and other organizational documents.

*Contact A Leoron Consultant for Support*

  1. The Employee Net Promoter Score

Also known as 'The Staff Advocacy Score' is a measure of the extent to which employees are advocates (promoters) of your organization. It can be measured by asking how likely is it that your employees would recommend your organization as an employer to a friend?

How is it calculated?

Via Survey; Expressed in %

  1. The Absenteeism Rate

The rate of unplanned absence due to sickness or other causes or an occasion of being away from work. It can be caused by physical illness, stress-related illness, a fake sick day, or absence due to other reasons. For instance, it can also include a parent calling in sick to take care of their sick child. It does not include holidays and lateness. It is calculated via employee absence data, which should contain the number of days (and date) of absence as well as the total workdays over that time. 

How is it calculated?

Absenteeism= Dt x Et x Et
Dt = Total number of days of unplanned absence
Et = Total number of individual absences

  1. Recruiting Channel Analysis

Is a metric that tracks the identification, recruitment, and hiring of candidates as to analyze and evaluate the effectiveness of all channels which are utilized throughout the recruitment process. The objective is to identify preferred channels of recruitment and deploy them in the future.

How is it calculated?

Detailed comparison between all recruitment channels. Selecting the one who provides the best candidates.

*Contact A Leoron Consultant for Support*

  1. Average Applications to Open Posts

Helps measure and understand your attractiveness, as a potential employer, to new hires. It can be measured by job families and compared across industries. It requires external data.

How is it calculated?

Number of applications for open post compared to other industries and competitors

  1. The Quality of Hire

Is evaluated by assessing the performance of the new hires over a certain period of time (for instance the probation period), after they join your team.

How is it calculated?

Performance Review Data

  1. Recruitment Costs

Are quite complex to be measured since they consider many internal and external factors. The 'Internal' recruiting costs are your internal costs and expenses, such as HR or recruiters’ salaries and money spent on your referral program (if you have one set in place – if you don’t set one now ?). The 'External' recruiting costs refer to every expense you pay outside of your scope, such as marketing fees, agency fees, recruiter fees and costs associated with a background check service. Below are the most common expenses:

  • Marketing fees: the amount spent on marketing (display) of each job opening.
  • Candidate assessment costs: fees that include all pre-employment tests or other assessment.
  • External recruiter expenses: money spent to pay individual recruiters, agencies or staffing firms.
  • Employer branding efforts: total funds spent on events or any endeavor related to recruiting (for instance, campus recruiting days, or careers fairs).
  • Careers page costs: expenses that include the setup, maintenance, and redesigning of the organization's careers page.
  • Internal recruiters’ costs (or HR personnel): often the highest recruiting line item, which includes the recruiters’ salaries, benefits and travel expenses.

How is it calculated?

Cost per Hire = Internal Recruiting Costs+ External Recruiting Costs / Total Number of Hires

*Contact A Leoron Consultant for Support*

  1. Time to Hire

Is a recruitment indicator that presents how much time it takes to fill in vacant posts with candidates who perform to a satisfactory level.

How is it calculated?

Time to Hire = Elapsed time between the 'Time of posting the vacancy' and 'Time to Start'

  1. Failure Rate of New Hires

Is calculated by dividing the number of hires in calculation period, which were terminated within the first 90 days of the Contract by the total number of new hires, during the same period of time, and then multiplied with 100. Also, it confirms the percentage of employees that leave your orgainzation in the first 90 days and the percentage of employees that pass the so-called 'Probation Period'.

How is it calculated?

(New Hires Terminated within 90 days / Total New Hires) x 100

  1. The Cost of getting to optimum productivity level

Includes the total cost involved in getting a new hire up to speed and it considers the onboarding and training cost, the cost of supervision and on-the-job training.

How is it calculated?

Onboarding Cost + Training Cost + Cost of Supervision + Cost of On-the-job Training + (Total Labor Cost * % OPL per month)

  1. Salary Competitiveness Ratio (SCR)

Is a metric that considers the competitiveness of the current salary for specific job roles. It can be measured against specific competitors or against the general industry.

How is it calculated?

SCR (competitor) = Salary offered by your organization / Salary offered by your competitor
SCR (industry) = Salary offered by your organization / Average Salary offered in the industry or sector

  1. Human Capital Value Added

Is a metric of the extent to which your team add value to your organization and business. Although it is complex and more difficult to be appropriately measured, in broad terms it can be measured via formula.

How is it calculated?

HCVA = Revenue - (Total Costs - Employment Cost) / Full Time Employees

  1. Revenue per Employee

Is an important productivity ratio that indicates how much revenue does your organization generate per each FTE.

How is it calculated?

Revenue per Employee = Revenue / Number of (full time equivalent) Employees

  1. Average Employee Tenure

Is a metric that measures the total time your employees tend to remain employed with your organization. It provides insights into their loyalty, satisfaction as well as the 'freshness' level of your team.

How is it calculated?

Average Employee Tenure = Sum of All Tenures / Number of FTEs

  1. The Attrition Rate

Also referred to as 'Staff Turnover' or ‘Churn Rate’ is a calculation of the number of employees that vacate or move over a period of time. It is can be calculated by multiplying the number of employees, who have left, by the total number of employees and multiplying the result by 100.

How is it calculated?

Attrition Rate (%) = (Number of leaves ÷ Number of employees) x 100

  1. Leaver Attitude Score

Measures the attitude of any employee who leaves your organisation, or their current role. The data for this metric is usually derived from a form completed during an ‘Exit Interview’ conducted by HR. Attitudes can be scored on different dimensions.

How is it calculated?

Data from Exit Interviews

  1. Administrative Cost vs. Total expenses

A helpful gauge to the management to measure the administrative (HR & Admin) percentages in a specific project or activity, to the overall expenses. It is a combined percentage of all HR and administrative costs to total expenses.

How is it calculated?

All other Project Costs - (HR + Admin Costs)
Expressed in %

*Contact A Leoron Consultant for Support*

  1. Diversity Index

A complex indicator that tries to establish the diversity profile of all your employees. Based on your strategic needs, measures could include gender, ethnicity, social and cultural background, as well as education levels.

How is it calculated?

Via Survey Data

  1. Strategy Awareness Level

Measures the percentage of your team who is aware of the corporate (or business unit) strategy. It is usually measured as part of an employee survey or during the performance review process.

How is it calculated?

Strategy Awareness Level = (Employees that are aware of the strategy / Number of Full-Time-Equivalent Employees) x 100

  1. Performance Review Completion Factor

A metric of the extent to which your team receives regular performance and career development reviews from their managers and HR.

How is it calculated?

Performance Review Completion Factor = (Rc / Ra) x 100
RC = Total number of performance reviews completed in a given time.
RA = Total number of employees that should have received a performance review during that same time.

Expressed in Ratio

  1. The Overtime Rate

Calculates the ratio between your team’s overtime, with the planned working times in a specific time.

How is it calculated?

(Employee Planned Time + Overtime)/ (Employee Planned Time)

  1. Employee Lateness

Assesses how many employees are late at work. It is relevant for organizations who have stricter lateness and tardiness policies. It utilizes information from the software for reporting coming-in and leaving the premises.

How is it calculated?

Expressed in %

  1. The Annual Leave Report

Presents your team’s current leave balances, as of the date selected. The number of worked days is calculated depending on the effective start and end dates. Accrued leave may create inconvenience with having to accommodate larger times away at a later date, as well as being a potential health and safety issue.

How is it calculated?

Number of worked days (Leave allowance days/365) – Taken days.

  1. Time Lost due to Accidents or Injuries

Is an indicator of safety in the operational environment of a business and indicates the risks of accidents.

How is it calculated?

Time Lost Due to Accidents or Injuries (LTI) = Number of employee days lost due to accidents or injury in a period/ Total hours worked in this period.

  1. The Lost Time Injury Incidence Rate

Measures the events that occur over a standard period by a standard number of employees. For instance, to calculate the 'Lost Time Injury Incidence Rate' for 1,000 people, the number of incidents is multiplied by 100, and then divided by the number of people.

How is it calculated?

No of Incidents x 100 = Y 

Y/ Total Number of People
For every 100 people, your organization would have a __ LTIs.

  1. Number of Reported Accidents & Incidents

Provides a broad benchmark in terms of knowing if the overall safety in your organization is improving or worsening over a period of time. In addition to monitoring the number of accidents/incidents, you can convert this number to a ratio per employee i.e. 0.001 accidents per employee. It is especially important during times of change such as implementing a new process, new machines, etc.

How is it calculated?

*Contact A Leoron Consultant for Support*

OLDER

NEWER

Related posts