How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these...

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Welcome! How Big is My Fish? HR Metrics and the Tale of the Tape

Transcript of How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these...

Page 1: How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these goals and the metrics needed. 1. Weight metrics in order of importance (C -Suite not

Welcome!

HowBigisMyFish?HRMetricsandtheTaleoftheTape

Page 2: How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these goals and the metrics needed. 1. Weight metrics in order of importance (C -Suite not
Page 3: How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these goals and the metrics needed. 1. Weight metrics in order of importance (C -Suite not

Agenda• Conceptual Overview

• Common Errors• Terms

• Types Metrics• Descriptive/Predictive

• Strategic Focus• Good Measurement• Benchmarking• Communicating Metrics• Have some fun• Free Metrics!

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One hour expectations!• Will

• Additional insight• Critical thinking

• Direction & Focus• Useful terminology

• Business acumen• Additional resources

• Communication• Metrics Super Hero

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As business writer Peter Drucker stated, “What gets measured gets managed,” so implementing an HR reporting system should be carefully planned.

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CurrentState?• 14%ofHRdepartmentsareusinganalytics(Deloitte2014)

• Comparedwith• 77%ofoperations• 58%ofsales• 56%ofoperations

• Why• TendencyforHRtooverrelyonsurveys,intuitionandexperience?• Notgiventechnicalresourcestocrunchdata?• Drowningintransactionalissues?• HRProfessionalslackstatisticaltraining/experience?• HRProfessionalsaremoreorientedtowardspeoplethanprocessandmetrics?

“They’re working so hard to get stuff done that they’re not taking advantage of the systems yet,” Jayson Saba, VP Ceridian

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WhyMetrics?

•Peoplecostsrangebetween35to60%•Nearlyeverythingcanbemeasured•Productivityiskey•MetricsprovideevidenceofHR’sstrategicimpact!

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ConceptualOverview

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SiloMetrics

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Quantity!

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1. HRobjectivesandstrategiesarealignedwiththebusiness(C-Suitediscussions)goals.

2. Identifyhow HRwillachievethesegoalsandthemetricsneeded.1. Weightmetricsinorderofimportance(C-SuitenotYou!).

3. Define eachHRmetricanditsformula(notallformulasarethesame).

4. Determinewhatdata isneededanhowitwillbecollected.5. DeterminehowoftenHRmetricsshouldbecollected.6. Choosetheformatofthereportandwhowillreceiveit.7. Reevaluate onaregularbasisofwhatisbeingmeasureandhave

thegoalschanged.

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Page 14: How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these goals and the metrics needed. 1. Weight metrics in order of importance (C -Suite not

Metricsvs.

Measures

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Metricsvs.

MeasuresA measure is“an amount or degree of something, the assignmentof numbers to properties of objects basedon a set of rules”

A metric is“a standard of measurement, or the outcomeof the measurement, big, value, effectiveness, etc.”

In our case we’re really interested in knowing how Bigis our fish, correct?

Page 16: How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these goals and the metrics needed. 1. Weight metrics in order of importance (C -Suite not
Page 17: How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these goals and the metrics needed. 1. Weight metrics in order of importance (C -Suite not

CommonMetrics

1.CostPerHire2.RevenuePerEmployee3.AbsenceRate4.BenefitCost5.Satisfaction6.Turnover

5.Vol/Invol,Perf,Dept.,Sup,Tenure,Demographics

7.Tenure8.TurnoverCosts9.WorkersComp10.TimetoFill

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SampleWorkforceMetrics

• Production• Output/Inputs• Loss• Processedorders

• Sales• SalvesVolume/Revenue• MarketShare• CostofSales

• Service• Quality/unit• Satisfaction• CustomerTurnover/Retention

• Profit• Margin• Profitabilitybycustomer• ROI• Costtoincomeratio

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DescriptivevsPrescriptive

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DescriptiveMetrics

• HRsystemsnowproducemountainsofdata• Examiningthisdatainhindsighttoseewherethecompanyis(orwas)isdescriptive.

• Hasvalue,butgenerallyinatacticalsense• Let’syouknowifyouhavemetgoals(laggingindicator)• Dangerousifyouextrapolateintothefuture

Example: Measuring Turnover and Sick Leave Utilization

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PredictiveMetrics

• Predictivemetricsgiveinsightintothefuture(leadingindicators)

• Measuresdriversofkeyperformanceindicators• Oncemodelsaredeveloped,futurelevelsofKPIcanbeinfluenced

• Greaterstrategicvaluethandescriptivemetrics

Example: Identify the traits that make for successful performance in a particular job, or the most effective method for delivering training to employees of a certain age in a specific working group.

Page 23: How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these goals and the metrics needed. 1. Weight metrics in order of importance (C -Suite not
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Analytics

• Analytics is a framework of logic that is used to gather, organize, and interpret data for the purpose of assessing the probability of upcoming events

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FromMetricstoAnalytics

1. Recordingourwork(e.g.,#ofhires,costperhire)2. Comparingourresultstoothers(benchmarking)3. Relatingtoourorganization’sgoals(e.g.,quality,

innovation,productivity,andservice)4. Understandingandcommunicatingpastbehavior

andoutcomes(descriptiveanalytics)5. Predictingfuturelikelihoods(predictiveanalytics)

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Right tool, wrong focus…

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StrategicMeasurement

• Askyourself“whereismymetricfocus”?

• MajorityoforganizationshaveaninternalHRfocus

• Silomentality

• Possessedwiththepast

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Peoplevs.HRMetrics

• HRmetrics(e.g.costtohire)haveatacticalfocus• Canbestbethoughtofasintermediatemetrics• Justifyingourexistence

• Strategicfocusispeoplemetrics• Theyimpactthemissionoftheorganization

• Engaged,StateofReadiness,Performanceculturethatdrivesquality,innovation,productivityandservice

• Ifyouwanttohaveavoice,youneedtoknowthelanguage

• Needtogetinsidetheheadofyourexecutives

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ConceptsvsMeasures

Concept Measure

Deficiency Contamination

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GlobalMarketShare

SMARTStrategyMap

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SalesCustomerService

Strategy Map

Good metrics are about measuring important organizational attributes and the relationship between those attributes

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Engagement CustomerService

TrainingLeadership

Engagement CustomerService

PerformanceFeedbackCommunication

JobResources

JobFactors .35 .56

.35 .56Sales

Sales

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Training

Engagement

PerformanceFeedback

Turnover Productivity

.45.65

.35

.38

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StaffingLevelsProductionOrders

ServiceQuality

-.38 .45

Costperhire JobFitCustomerService

.27 .30

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EngagedSupervisor

EmployeeRetentionRates

Productivity

-.38 .45

LengthofService

KnowledgeofJob

CustomerService

.27 .29

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GoodMeasurement

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Right focus, wrong tool/bait…

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After identifying what needs to be measured (conceptually) and why, we then need to find a tool with good measurement properties.

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DesirableMeasurementProperties

• Measuresusedtoassessmetricsmustbeconsistent:

• Acrosstime

• Acrossraters

• Withinmeasurementtools

• Reliability

Page 40: How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these goals and the metrics needed. 1. Weight metrics in order of importance (C -Suite not

DesirableMeasurementProperties

• Mustmeasurewhatweintendedtomeasure

• Issueofdefinitionandoperationalconsistency

• Shoulddemonstratelogicalrelationshipswithothermetrics

• Shouldalsopredictrelatedoutcomes

• Constructandcriterionvalidity

Page 41: How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these goals and the metrics needed. 1. Weight metrics in order of importance (C -Suite not

Causation

• Verifyingthoselinksinthechaincanbetricky

• Twoconceptscanberelatedbychance

• Mustshowthatleadingindicatorcauseschange

• Temporalprecedence

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Career Development (+) Customer Satisfaction Scores

Career Development (-) Turnover

Correlationmadesimple

Salary Levels (+) Performance Level (causation?)

Page 43: How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these goals and the metrics needed. 1. Weight metrics in order of importance (C -Suite not

Vendorsandshinymetalobjects

• “Everythingthatcanbecounteddoesnotnecessarilycountandeverythingthatcountscannotnecessarilybecounted.”

- AlbertEinstein

• AvendorclaimingametricpredictsoverallOEshouldbeviewedskeptically

• ReliabilityandValiditymustbedemonstrated

• Specifictoyourcompaniesstrategy

Page 44: How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these goals and the metrics needed. 1. Weight metrics in order of importance (C -Suite not

Thingsyoushouldhear…

• “Whatarethetop3-5peoplemetrics?”

• “Itdepends…tellmemoreaboutyourbusiness”.

• “Whatspecificoutcomesdoyouwishtochange?”

• “Canyoutellmethe#1priorityofyourbusinessunits?”

Page 45: How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these goals and the metrics needed. 1. Weight metrics in order of importance (C -Suite not

Benchmarking

• Against“aspirationalpeers”…?

• Comparisonsaresometimesinvalid

• Needtoknowalotaboutthecomparisoncompanies

• Canyieldviewsofbroadtrendsacrossindustries,however…

• Strategicdecisionsarebestinformedbyinternalmetrics

Page 46: How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these goals and the metrics needed. 1. Weight metrics in order of importance (C -Suite not

1 2 3 4 5 6 7StronglyDisengaged

Disengaged SomewhatDisengaged

NeitherEngagednorDisengaged

SomewhatEngaged

Engaged StronglyEngaged

1 2 3 4 5 6 7StronglyDisengaged

Disengaged SomewhatDisengaged

NeitherEngagednorDisengaged

SomewhatEngaged

Engaged StronglyEngaged

1 2 3 4 5 6 7StronglyDisengaged

Disengaged SomewhatDisengaged

NeitherEngagednorDisengaged

SomewhatEngaged

Engaged StronglyEngaged

Page 47: How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these goals and the metrics needed. 1. Weight metrics in order of importance (C -Suite not

“If you can't explain it simply, you don’t understand it well enough.” - Albert Einstein

Page 48: How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these goals and the metrics needed. 1. Weight metrics in order of importance (C -Suite not

CommunicatingwithExecs

• Communicateearlytopartneronmetricdecisions

• Getoutoftheweeds

• Makethepeoplenumbershavebusinessmeaning(m =3.5?)

• Beagoodtranslatorandstoryteller

• Turningdataintobusinessintelligence

Page 49: How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these goals and the metrics needed. 1. Weight metrics in order of importance (C -Suite not

Measurementisnotanendinitself

• Ithasvalueonlyiftheresultsprovidemeaningfulinputintosubsequentdecisions.

• Therefore,asyouthinkaboutthechoiceofaparticularmeasure,stopforamomentandthinkcarefullyaboutwhatyouwoulddowiththeseresults.

• Imaginereceivingyourfirstreportsummarizingthismeasure.• Whatkeydecisionswilltheseresultshelptoform?• Willanothermanager,particularlyoutsideHR,considerrecommendationsbasedonthismeasuretobepersuasive?

• Ideally,you'lldevelopameasurementsystemthatletsyouanswerquestionssuchas,howmuchwillwehavetochangeaantecedentordriver inordertoachieveourtargetchangeinouroutcomevariable?

Page 50: How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these goals and the metrics needed. 1. Weight metrics in order of importance (C -Suite not

Summary

• Conceptual Overview• Strategic Focus• Descriptive vs. Predictive Metrics• Good Measurement• Benchmarking• Communicating Metrics

Page 51: How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these goals and the metrics needed. 1. Weight metrics in order of importance (C -Suite not
Page 52: How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these goals and the metrics needed. 1. Weight metrics in order of importance (C -Suite not

Questions?

Page 53: How Big is My Fish? HR Metrics and the Tale of the Tape · 2. Identify howHR will achieve these goals and the metrics needed. 1. Weight metrics in order of importance (C -Suite not

ThankYou!

JimGalloFloridaInstituteofFishing150WestUniversityBlvd.MelbourneFlorida32901

1(321)[email protected]


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