Jun 16, 2006

On HR Metrics

This post is owes its genesis in a conversation I had with a friend who works as a HR consultant.

She had called me up and was trying to understand the metrics that are usually reported by the training and development group within organizations and how they might make more sense.

Then it struck me that training metrics are symptomatic of HR metrics not being aligned to business value and therefore wasting individual's energies.

The power of metrics is frankly underrated, and that is where the disconnect between stated objective and achieved reality often starts.

Take the example of training and learning metrics.

The stated objective of the training group is to increase individual and team performance to meet the strategic needs of an organization. That is the outcome expected from this group.
But the metrics that are tracked focus more on inputs, like

1. are all employees getting the promised x hours of training?
2. Do most of the training get ranked "very good" by majority of the participants?

The metrics focussing on output linked to performance however, are done few and far between. One of the reason is that organizational systems and processes are not designed to catch this information and extra manpower is used for doing so.

And this is the reality for metrics that are tracked for Recruitment, Compensation and Generalist roles too.

HR is trapped in tracking efficiency metrics, while business needs metrics that focus on effectiveness.

More posts on how HR can make this transitions coming up.

2 comments:

  1. Gautam,

    HR was considered as a Support Function in most of the organisation. So was IT/EDP Dept.

    Few years back I met up with a EDP Manager of a small company in Pune, India.

    Challenges that he had on had was
    - PC's getting outdated..
    - OS upgrades demanding upgrade of Hardware
    - External AMC vendors upping their service fees
    - Keeping the IT team motivated
    the list goes on.
    - Expectation from the Organisation to work on a shoe string budget
    - Expectation from the Organisation to keep the applications and systems up and running optimally all the times.

    What he came up with was that the EDP Dept be treated as any vendor. for each service rendered (PC Maintenance, Data/Application Backup, Report writing, Application Change Request, Installation of PC etc) he put a notional cost. This way he earned revenue for this dept. Which he could use for Training his Team, Upgrading the PC,s, Upgrading the OS and other applications, etc.

    At first the Management was amused and played along. The result was not amusing in fact it was an eye opener for the management.

    The EDP Dept was treated as advisors and the organisation started seeking their advice. They actually improved Organisation efficiency and saved cost for the organisation.

    Success of the above was that this manager could within 2 years implement a world class ERP for the orgnisation. He got the necessary budget sanctioned out of the revenue (notional) that his dept earned.

    Needless to say HR today is more of a strategic role. I have seen in many organisation HR playing a strategic role in the growth of the organsitation.

    - Stankov

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  2. hi
    may i can know more about the metrics that can be used in measuring the sucess of the Career management programme going on in an IT c ompany with Mentee- Mentor relationship.

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