THE STATE BANK OF VIETNAM MINISTRY OF EDUCATION AND TRAINING

BANKING UNIVERSITY AT HO CHI MINH CITY

DEPARTMENT OF BUSINESS ADMINISTRATION

ASSIGNMENT 1
HUMAN RESOURCE MANAGEMENT
HR METRIC

Full name: Tran Thao Trang

Student ID: 050606180418

Class Code: MAG320_211_6_L07_TA

Lecturer: Dang Truong Thanh Nhan, MBA

HO CHI MINH CITY, 2021

1. What are HR Metrics? Give examples of some common HR Metrics
2. In theory, HR planning always FOLLOWS strategic planning. In reality, is it
always correct? Why ?, give an example to illustrate your explanation.

1. What are HR Metrics?

HR metrics are specific measures of HR practices. They are performance
indicators of various HR issues, like absenteeism and turnover rates. Metrics are
typically used to assess HR practices and results within the organization over time.
A metric can be developed using cost, quantity, quality, timeliness, and other
designated goals. Metrics can be developed to track HR efficiency and
effectiveness.

Figure - Key HR Metrics

Examples of some common HR Metrics:
Time to hire is the average number of days it takes to fill an open position.
Typically, the countdown starts when the candidate enters your recruiting pipeline
and ends when they accept the job offer.
Time to hire = Day candidate accepted offer – Day candidate entered pipeline

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Cost per new hire measures the amount of money it takes to find, recruit, and
hire a new employee. You’ll capture both internal and external costs, like fees for
advertising the role, using an applicant tracking system or staffing firm,
interviewing candidates, and running background checks.
Cost per hire = Total recruitment cost / Total number of hires = Total internal
cost + Total external cost / Total number of hires
Source of Hire: In order to hire more employees, recruiters have to use different
channels including company’s website, social media, or different sources of
online hires such as Indeed, Career builder, etc. This metric gives HR recruiters
the information about which recruiting channels are effective in attracting
candidates so that they will spend their money in recruiting more effectively.

Revenue per employee is exactly what it sounds like, measuring how much
revenue each employee generates and the efficiency of the organization overall.
You can tap the highest-earning employees to lead training programs and business
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strategy sessions. To calculate it, find the cost and divide it by the number of new
employees you hired over a given period of time.
Revenue per employee= Revenue/Current Number of Employees

Overtime hours are time spent working outside office hours and can represent a
large cost investment if enough employees use it. As an HR metric, it clues you
into unbalanced workloads, hiring needs, or inefficient scheduling so you can take
measures to solve it.

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Annual wage and salary increases: A pay raise is a method to show your staff
that you value their work and recognize their achievements. Employees that do
well are rewarded with raises in pay, which encourages them to stay with the firm
and advance their careers. When it comes to pay raises, it's critical to understand
when and how to give them, as well as the variables that should influence your
choice.
Payroll as a percentage of operating expenses expressed as a proportion of sales
income is known as payroll percentage. A high payroll percentage might indicate
that you're overpaying your employees. It's an important measure to consider
when deciding how much to spend on payroll, such as whether to recruit new
staff, boost compensation, or cut down when required. The payroll to sales
percentage, payroll to revenue percentage, and labor cost % are all terms used to
describe the ratio.
Payroll percentage = (Total payroll expenses/gross revenue) x 100
The cost of training employees: Training new employees is a necessary part of
onboarding. Training new employees is a necessary part of onboarding
You must pour time and money into making sure a new hire understands their job
responsibilities. Improper training can lead to sloppy work or eventual employee
turnover, which means repeating the whole process. The cost of training programs
for employees won’t be the same for every business.
Training Cost Per Employee = Total Training Expenses / Number of New
Employees
Avarage tenure of employees: Just as it’s important to look at the average length
of tenure for employees, it is also helpful to look at a company’s average tenure
per employee, which averages all of the employee’s tenures with the total number
of employees.
Avarage tenure= Total Employment Time for All Employees/Total Number of
Employees

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Percentage of employees with career plan indicates how people progress
throughout your organization, whether through lateral transfers or promotions. It's
important to keep track of both, as your org chart can rapidly become too "top-
heavy" if promotions go unchecked.
Percentage career path of employees= Total Promotions/(Total Transfers + Total
Promotions)

2. In theory, HR planning always FOLLOWS strategic planning. In

reality, is it always correct? Why? Give an example to illustrate your
explanation.
It seems to me that the answer for “HR planning always FOLLOWS strategic
planning” is always right in reality. A strategic plan is a document used to
communicate with the organization the organization's goals, the actions needed to
achieve those goals and all of the other critical elements developed during the
planning exercise. Human Resource Planning (HRP) is the process of forecasting
the future human resource requirements of the organization and determining how
the existing human resource capacity of the organization can be utilized to fulfill
these requirements.
When the human resource strategy is implemented in a certain period of time, the
manager should make an assessment. Evaluate whether the plan will help the
company achieve its goals. For example, profit, growth, employee engagement
rate, satisfaction level, etc. If everything is going well, continue with the plan. If

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there are obstacles, please promptly change to fit the needs of your company.
Moreover, human resources are the most important factor of a successful business.
Give an example to illustrate your explanation.
In particularly, Vietnam currently has 5 airlines that are operating regularly,
including: Vietnam Airlines, Jetstar Pacific, Vietjet Air, VASCO, Bamboo
Airways. The growth of the industry poses new challenges to the infrastructure
system, leading to a shortage of pilots and technical staff. According to
regulations, pilots working as flight supervisors must have a flight instructor
certificate. The lack of qualified annual oversight led them to find alternative ways
to replace HR planning. They have to replace the missing space by hiring outside
supervisors for up to 70 %, which will increase the cost compared to their strategic
plan.
In the past few days, the Covid-19 epidemic is developing complicatedly as new
infections appear in many provinces and cities. Therefore, people have raised their
awareness of epidemic prevention by limiting going to crowded places as
recommended by authorities. Along with that, the regulation to suspend non-
essential activities to join hands in the prevention of the Covid-19 epidemic, so
the business in many shops had to be temporarily suspended. Therefore, stores
must change their business direction according to the previous business plan to
maintain operations. They apply the method of reducing personnel or changing
working positions to avoid wasting human resources and reduce payment costs.
If there is no reduction in human resources, the company/store will incur huge
costs without profit, affecting the business process later.
In conclusion, human resource planning usually follows strategic planning.
Because in the early stages of the planning process with defined strategic goals,
managers can develop human resource plans that will help them accomplish those
goals. But the human resources department must have a plan for timely change in
reality. Human resource planning influences strategic planning and vice versa.

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REFERENCES
HAYES, A. (2021, May 17). Human Resource Planning (HRP). From
https://www.investopedia.com/terms/h/human-resource-
planning.asp
Mathis, R. L. (2015). Human resource management: Essential
perspectives. Cengage Learning. Cengage Lerning.
PHÙNG, T. (2019, August 02). Việt Nam thiếu phi công, thiếu cả giám
sát bay. From Tuổi Trẻ: https://tuoitre.vn/viet-nam-thieu-phi-
cong-thieu-ca-giam-sat-bay-20190801214843271.htm
Vo, E. (2018, November 19). What Is Strategic Planning? From
https://sba.thehartford.com/business-management/what-is-
strategic-planning/
Vulpen, E. v. (n.d.). 14 HR Metrics Examples. From
https://www.aihr.com/blog/14-hr-metrics-examples/

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