HR Metrics:

Benchmarking Human Resources

Wednesday, November 16, 2005 11:00 AM 12:15 PM
Valerie Paul
valerie@catalysthr.com www.

Rachel Andreasson
randreasson@mail.wallisco.com www.wallisco.com
The opinions of the contributors expressed herein do not necessarily state or reflect those of the National Association of Convenience Stores. Reference herein to any specific commercial products, process, or service by trade name, trademark manufacturer, or otherwise, shall not constitute or imply an endorsement, recommendation, or support by the National Association of Convenience Stores. The National Association of Convenience Stores makes no warranty, express or implied, nor does it assume any legal liability or responsibility for the accuracy, completeness, or usefulness of any information, product, or process described in these materials.

Benchmarking Human Resources

Why Measure? What to Measure? How to Measure? Where to get Data? What Drives a Measure? Whats Being Done Today?

Preparing to Measure
Know Your Organization
List Top 3 Business Goals over next 5 Years

Start With the Strategy

What is your companys differentiating factor, your niche?

Build a Scorecard
List the critical objectives, linked to your niche that will ensure future success?

Measure for Success

Measure to identify and track success in achieving the strategy.

The Whole Picture

Vision Mission Strategy Measures Initiatives Everyday Tasks

Scorecard Perspectives

Measure for Success

S M A R T

Putting It Into Action

Initiatives & Action Plans

Who is Accountable? To do What? By When?

Sources
Association Reports
NACS SHRM

Reports
Saratoga (Price Waterhouse Coopers) Staffing.org Watson-Wyatt

Books
HR Metrics, the World Class Way, J. Sullivan The ROI of Human Capital, J. Fitz-Enz The HR Scorecard, Becker, Huselid, Ulrich The Workforce Scorecard: Managing Human Capital to Execute Strategy, Mark A. Huselid

More
Human Capital Dashboard, CLC Metrics Human Capital Source (Jack Fitz-Enz)

A Framework Model
Financial Measures

Results Achieved

HR Efficiency

Self Test for Metrics

Can you explain it in one sentence? Is the area it measures top-ofmind in the organization? Can people in the organization remember and explain it? Is the number simple to get and understand? Does the source for the data have credibility?

Sample Metrics from SHRM HR Metrics Study

Employment Time-to-Fill Cost-Per-Hire Number of Positions Filled HR Departments and Expenses Total HR Staff HR-to-Employee Ratio HR Expense to Operating Expense Ratio HR Expense per FTE Health Care Health Care Expense per All Employees Health Care Expense per Covered Employees Percentage of Premium Organization Pays for Employee-Only Coverage Percentage of Premiums Organization Pays for Employee and Dependent Coverage Projected Increases in Health Care Expenses Compensation Annual Salary Increases Annual Turnover Rate Salaries as a Percentage of Operating Expense Organizational Data Revenue Revenue per FTE Net Income Net Income per FTE

How Does HR Measure Up?

Measure Formula Notes Your Company $ Revenue Per Employee Full-Time Equivalent Full time equivalent = 1 for each full time employee, for each part time employee If support staff in the field or at the corporate office support other revenue areas, count those individuals as part time, unless that support is minimal Convenience Revenue is defined as sales of any product or service in the following categories; in-store sales and services, motor fuels, food service, car washes In companies where other revenue exists, such as home heating fuels, do not include these revenues

Average Length of Service of Store Managers

Total Tenure of Managers Number of Managers Number of Cashiers

Use total tenure at the company, not just time as manager Use position closest to cashier such as customer service rep, associate, etc. Non-base pay = all payments over and above base pay, such as commissions, incentives, bonuses. Do not include non-cash payments, auto allowances, or payments made in lieu of benefits %

Average Age of Front Line Staff

At-Risk Payroll of Managers

Total Non-Base Pay Paid to Mangers Total Compensation of Managers

How Does HR Measure Up?

Recognition Program Spending Convenience Revenues Use total dollars from all programs and activities that reward or recognize performance or milestones, including recognition meetings, service awards, performance recognition programs, birthday or anniversary recognition programs, etc Use Convenience Revenues as defined above Use Full Time Equivalents (FTE) as defined above For HR FTEs, count staff with HR titles or who report to a Human Resources department. Also count staff who spend more than 60% of their time performing traditional HR functions or conducting training activities or programs, even if these individuals do no report to HR. Traditional HR Functions include: Compensation Benefits Training Recruiting Staffing & Staff Planning HR Information Systems Employee Relations Employee Dispute Resolution Employee Motivation/Rewards Workers Compensation Unemployment Administration Performance Management Policy Development/Documentation Employee Recordkeeping Organization Design Strategic HR Planning If Human Resources staff or staff with HR responsibilities in the field or at the corporate office support other revenue areas, count those individuals as part time, unless that support is minimal. %

HR to Employee Ratio

Total FTE Total # of HR FTEs

NACS Human Resources Forum

Please Plan to Join Us! March 7-9, 2006 Marriott Dallas/Addison Quorum by the Galleria in Dallas, Texas

The program will once again feature Valerie Paul of Catalyst Consulting as the program leader and will continue to examine the importance of HR metrics as well as other HR issues.

Contact Us
Rachel Andreasson Wallis Companies 106 E. Washington Cuba, MO 65453 (573) 885-2277 randreasson@mail.wallisco.com www.wallisco.com Valerie Paul Catalyst Consulting 33 Elm St. Uxbridge, MA 01569 (508) 278-3391 valerie@catalysthr.com