Most important organizational performance metrics
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Transcript of Most important organizational performance metrics
The Most Important
Organizational Performance Metrics:
What Every HR Organization Should Be Measuring…
Results Training Company
Dr. Lepora Manigault, SPHR, PMP, Six Sigma
Black Belt
Today’s Itinerary
Today’s Purpose What Value Does
Your HR Operation Bring?
What Is Wrong w/ HR?
Holistic & Strategic Approach
What Metrics Are and Are Not…
Characteristics of Metrics
The Importance of Benchmarking
Balanced Scorecard
Essential
HR Organizational Metrics
What’s In a Business Case?
Next Steps in Metrics for Your
HR Operation
2
T
Why Are You Here?
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Why Are We Here?
Major Goals:
To improve HR and Human Capital by
way of measurement.
Elevate the Strategic level of HR.
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The Beneficial Journey of HR Metrics..
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Measurement
Transparency
Navigation and Direction
Informed Decision- Making
Performance Improvement
Credibility
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What Value Does Your HR Operation Bring?
Do You Motivate Great Performance?
Do You Increase the ROI?
Do you Keep Star Employees?
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How Do You Know?
HR is considered
one of the
least strategic
departments in
organizations…
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Why is the
missing link
of
HR
missing?
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Where’s the Beef?
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Your Data is Your Compass…
You must have it to Know Your Location.
Lack of data
=
lack of ability
to align with
CEO in:
•Priorities
•Projects
•Expected Performance
•Decisions
The First Step is Holistic Scanning…
People
Technology
Processes
Financial Resources
Customer
Structure
Competitive Environment
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What Are the Causes and Effects?
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Human
Resources
Programs
Individual Performance
Technological Access and Automation
Work Processes
Cost Saving and Revenue Growth
Customer Satisfaction
Supporting Organizational Structure
Competitive Advantage for Talent
HR Strategy Should
Directly Support the Corporate Strategy…
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VISION
MISSION
GOALS
HR OBJECTIVES
CORPORATE
H
R
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S.M.A.R.T.
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SPECIFIC
MEASURABLE
ATTAINABLE
RELEVANT
TIME- BOUND
Build a Balanced Scorecard
that clearly reflects the performance level.
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Good
Risky
Low
METRICS
• Numbers
• Information
• Tools
• Current Performance
• State of Condition
ANALYTICS
• Meaning
• Comprehension
• Application
• Future Performance
• Implications
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Metrics vs. Analytics
METRICS
• Numbers
• Information
• Tools
• Current Performance
• State of Condition
ANALYTICS
• Meaning
• Comprehension
• Application
• Future Performance
• Implications
The Importance of Benchmarking
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Know Your Competitors and Counterparts
Compete for Talent
Compete for Customers
Avoid Overpaying
Manage Relevant Metrics
Develop Realistic Metrics
Note: Benchmarking is only as beneficial as the level of similarity (apples to apples)
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The Dollar Value of the Increased Workforce Productivity
between This Year and Last Year…
Organization Revenue (2010)
HR / Organization Expenses (2010)
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Is there an organizational value of Continuous Improvement?
For example….
vs.
Productivity &Efficiency
Organization Revenue (2009)
HR / Organization Expenses (2009)
Employee Engagement
The % of employees who feel
that their managers exercise
expected management
behaviors
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Quality of Hire
For example:
P+R
2 (N)
P = Average job performance rating of new hires
R = % of new hires retained after one year
N = number of indicators
Hiring
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Diversity
The % of diversity hires
in
managerial and senior
positions
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For Example:
Relative to Company Goals, Company Organization, City Population
Diversity
The Turnover Rate of “Star” Employees
% of employees to exit over past year
Number of employees in total organization
Star Employee: Rank above average on Performance Evaluation; Identified Successor
Retention, Succession Planning
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Succession Planning
% of critical positions
with
immediately identifiable
replacements
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Incentive Compensation Differential
Monetary incentives to high performers-
Monetary incentives to low performers
Monetary incentives to high performers
Rewards
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X 100%
There should be a stark difference between benefits
received by high performers and low performers
Staffing & Learning
% of goals on
Development Plan that
were completed on time
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Staffing & Learning
% of Performance Appraisals
completed on time
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Training ROI
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Increased Revenue (Benefits) - Training Costs
Training Costs
Evaluate :
Reactions
Learning
Behavior, and
Results
X 100%
Staffing & Learning
Time To Start
TTS= RR- SD
TTS: Time until the new hire starts
RR: Date the requisition is received
SD: Date the new hire starts work
Recruitment
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Legal/ Compliance
Costs of HR related litigation
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May compare to prior year to identify trends, improvement, etc.
Legal/ Compliance
Average time for
HR dispute resolution
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May compare to prior year to identify trends, improvement, etc.
QUALITATIVE DATA
Top reasons for
voluntary turnover
Retention
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QUALITATIVE DATA
HR provides quality
consultative advice
HR Business Partner
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Build a Solid Business Case
for EVERY Project..
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Aligned with
Corporate Strategy
High Level Action Plan
(Executable) Timeline & Milestones
Description of Initiative Rationale/ Purpose
Benefits/ Cost Ratio
(Healthy)
Alternative Options Break Even Analysis &
Return On Investment Budget
Alternative Options…
• Pros
• Cons
• Costs
• Solutions to Obstacles
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Obstacles?
What are Your
Current Obstacles
to a
Better or New HR
Metrics
Program?
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Contact Info:
Dr. Lepora Menefee,
PMP, SPHR, Prosci, SSBB [email protected]
www.resultsconsulting.net www.drlepora.com
www.facebook.com/drlepora www.twitter.com/drlepora
770.367.5444
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