HR Metrics

Lesson 9 & 10

3/5/2020 MYR- HR Metrics- FSM

HR Efficiency Metrics
• Employee Attrition and Employee Turnover
• What is the difference between two
• Metrics commonly used to measure it
• Stages of employee disengagement
• Are turnovers costly
• How we can predict them

3/5/2020 MYR- HR Metrics- FSM

Employee Turnover and Attrition
• Employee Turnover • Employee Attrition
• Leaves organization at will • Leaves organization on a cause
(voluntary) or is asked to leave which is inevitable
(involuntary) • Retire
• Better salary • Family
• Better opportunity • Death
• Better/ challenging environment • Back to school/higher studies
• Discriminatory environment
• Mistrust
• Work fatigue/stress
• Termination
• Laid off/ Released

3/5/2020 MYR- HR Metrics- FSM

Employee Turnover | Metrics
• Turnover in First Month
• Count instances where difference in DO Leaving – DO Joining <= 1 Month
• Turnover in First Year
• Count instances where difference in DO Leaving – DO Joining <= 1 Year
• Voluntary Turnover
• Count instances where employee leaves an organization at will in a year
• Involuntary Turnover
• Count instances where employee leaves an organization not at will in a year
• Key Talent Turnover
• Count instances where Key talent/ Critical employee (notified by organization)
leaves in a year
• Employee Turnover Per Department/ Per Manager
• Count instances of Employee turnover per department/ per manager in a year
3/5/2020 MYR- HR Metrics- FSM
Employee Turnover | Metrics
Does Cost of Turnover matters?
• If an airline bought a new 777 Dreamliner, and then let it sit for two months on
the runway because they didn’t have pilots(who left the airline couple of weeks
ago) then what would the cost be to the airline?
• In other words what is the cost of turnover and additionally what is the cost of a
vacant position (COV)?
• Cost of Turnover and COV can be significant; anywhere from:
• $7,000 dollars per day to $50,000 per day for an engineering position.
• Key leadership positions may cost as much as a million dollars per week.

3/5/2020 MYR- HR Metrics- FSM

Employee Turnover | Metrics
• Cost of Turnover can be calculated by finding:
• Recruiting Costs
• Fees paid to outside recruiters
• Advertising costs if you have to place an ad for a specific
• Interview costs
• Travel Allowance/Dine Allowance to candidates to visit the company for interviews
• Travel costs for your staff to go to a recruiting fair to source candidates
• Time for your Human Resources (HR) staff and hiring department staff to interview
candidates
• Post-interview costs
• Time to check references and credentials from candidates who pass the screenings
• Pre-employment skills testing you may need or want to administer
• Pre-employment screenings for drugs, etc.

3/5/2020 MYR- HR Metrics- FSM

Employee Turnover | Metrics
• Cost of Turnover can be calculated by finding:
• Employment costs
• Signing bonuses, if paid
• Relocation expenses for the prospective employee and their family
• Training costs
• Time for people to train them.
• OJT Training; External consultants/trainers
• Training materials.
• These will have to be prepared or, if they exist, reviewed and updated.
• Accommodation costs.
• These include any special equipment or supplies the individual may need, either from
personal preference (like a specific type of chair) or to accommodate special physical or
mental needs.
• Administrative processing

3/5/2020 MYR- HR Metrics- FSM

Employee Turnover | Metrics
• Cost of Turnover can be calculated by finding:
• Opportunity costs
• the cost of business lost because you didn't have the people resources to do all the work
while you were shorthanded.
• For example:
• calls not answered before the caller hung up
• sales calls not placed to prospective customers
• or trade show appearances canceled because no one was available

3/5/2020 MYR- HR Metrics- FSM

Employee Turnover | Metrics
Benchmark Employee Cost/
Employee Salary+ Benefits
Day

Benchmark Employee
Cost/Day
Cost of Vacant Position

Cost of Leaving
Advertisement,
Cost to Fill Assessment, Background
Checks, Travelling, Hiring

Cost of Trainer/Day * No of
Cost of Training
Days

Employee Salary + Benefits

Productivity Ramp Up
* Probation
3/5/2020 MYR- HR Metrics- FSM
Employee Turnover|Stages of Disengagement

3/5/2020 MYR- HR Metrics- FSM

Employee Turnover | Metrics

Source: Josh Bersin Academy

3/5/2020 MYR- HR Metrics- FSM