Human resource metrics not only allow HR performance to be assessed, but it also allows the business to make strategic decisions that impact the bottom line. Ongoing year-over-year numbers give insight into costs and trends associated with turnover, employee engagement, performance, and human capital costs that are often not as visible as others. Aligning metrics with business strategy can add value and drive organizational effectiveness.
Not only can metrics help in driving strategic business decisions, but they can also identify potential problem areas and keep an organization out of trouble.
As a non-profit generating part of the business, every decision made by Human Resources should be driven by data that demonstrates effectiveness, efficiency, and value for every dollar spent.
For example, companies that participate in E-Verify but fail to use it every time may face fines from $250 – $2000 per occurrence. Failing to do background checks or pre-employment drug screens as prescribed by a company’s policy exposes it to potential legal liability in the event of an accident or intentional action on behalf of an employee.
Metrics allow organizations to know they are creating a strategy for where they want to get to. If the goal is to fill jobs faster you need to how long it currently takes, if it is to reduce costs, you need to know not only what you are spending, but what you are getting, if it is to be more efficient, you need to know where time is being spent.
I have created dashboards for a number of organizations and have personally seen the difference that metrics can make to not only the bottom line but the overall success. While there are systems and programs that allow for the automation of HR metrics and reporting, useful data can be aggregated in a simple format using basic tools and programs available in most organizations.