HUMAN RESOURCE HRM-442

MANAGEMENT
 COURSE INFORMATION

Course name Human Resource Management

Course code HRM 442
Credit hours 3
Email iqra.asghar@seecs.edu.pk
Visiting hours 3-5 pm (Wednesday & Thursday)
Location SEECS (office 207)
LECTURE – 11

HR metrics
1. What Are HR Metrics?
2. Explain why HR metrics matter?
 WHAT ARE HR METRICS?
 HR metrics are indicators that enable HR to track and measure performance on
different aspects and ultimately predict the future.
 HR metrics, or human resources metrics, are key figures that help organizations
track their human capital and measure how effective their human resources
initiatives are.
 Examples of such data include turnover, cost-per-hire, benefits participation rate,
etc.
 Measuring this kind of information—what’s working well, what needs
improvement, and what trends to expect in the future—helps organizations figure
out their people strategy.
HR METRICS

HR metrics are
indicators that
enable HR to
track and
measure
performance on
different aspects
and 
ultimately predict
the future
.
 RECRUITMENT
•Headcount: The total number of employees in your organization or within a specific department you may be
tracking.
•Demographics: The characteristics of your workforce such as age, gender, education level, and length of
service.
•Time to Hire: The average number of days between when a job is posted and when a candidate accepts
your offer.
•Acceptance Rate: The number of offer letters your organization extends divided by the number of
candidates who accept an offer.
•Cost per Hire: The average cost of hiring a new employee. You can generate this number by adding up both
internal and external hiring costs then dividing that total by the number of employees you hired in a given
period.
•Time to Productivity: The time it takes for new hires to become acclimated at your organization and start
working at full productivity.
•New-Hire Turnover: The number of new hires who leave within a set period of time, such as within their
first year of employment.
 ENAGAGEMENT &
RETENTION
•Employee Satisfaction: The number of employees who would recommend your company as a good
place to work versus the number of employees who wouldn’t, indicating overall employees satisfaction.
•Total Turnover Rate: The number of employees who leave your organization within a given period of
time divided by the average number of total employees (then multiplied by 100 to come up with a
percentage).
•Voluntary Turnover Rate: The turnover rate including only those employees who leave your
organization voluntarily.
•Talent Turnover Rate: The rate of turnover among your organization’s high-performing and high-
potential employees.
•Retention Rate: The opposite of your turnover rate in that you divide the number of employees who
remained in your organization over a given period by the number of total employees.
•Retention Rate per Manager: The retention rate broken down by individual teams and managers.
TIME TRACKING
•Absence Rate: The average number of days employees are absent in a given time
period, not including approved PTO (also called absenteeism).
•Absence Rate per Manager: The absence rate broken down by individual teams
and managers.
•Overtime Hours: The number of overtime hours worked by employees in a given
time period. You can calculate an average number or break it down by individual
employees.
 EMPLOYEE VALUE &
PERFORMANCE
•Revenue per Employee: The total amount of revenue divided by the total number of employees.
•Performance & Potential: A nine-box matrix that allows you to categorize employees according
to their performance and potential levels for better succession and leadership planning.
•Employee Performance: You can track employee performance through self-assessments, peer
reviews, manager assessments, or a combination of all three.
•Goal Tracking: If your performance management software includes goal tracking, you can see
the goals employees have set, how these goals connect to larger company goals, and the progress
employees have made.
•Company Performance: A high-level comparison of how well employees are performing versus
how engaged and valued they feel.
TRAINING & DEVELOPMENT
•Training Expenses per Employee: The total cost of your organization’s training
courses and programs divided by the total number of employees.
•Training Completion Rate: The number of employees who completed a given
training divided by the total number of employees, then multiplied by 100 to get a
percentage.
•Time to Completion: The average amount of time it takes for an employee to
complete a given training program.
•Training Effectiveness: There are several methods for measuring training
effectiveness, including running tests or assessments to generate a pass/fail rate.
HR SERVICES & SOFTWARE'S
•Ratio of HR Professionals to Employees: The number of employees in your
organization per HR professional on your team.
•Cost of HR per Employee: The total amount your organization spends on HR
functions divided by the total number of employees.
•HR Software Employee Participation Rate: The number of employees who
actively use your HR software divided by the total number of employees, multiplied
by 100 to get a percentage.
•ROI of HR Software: There are several factors that contribute to 
the ROI of your HR software, but the core formula is the difference between how
much the software costs your organization and how much money it generates or
saves your organization.
 REVENUE
•Revenue per employee (revenue/total number of employees)
This metric shows the efficiency of the organization as a whole. The ‘revenue per employee’ metric is
an indicator of the quality of hired employees.
•Performance and potential (the 9-box grid)
The 9-box grid appears when measuring and mapping both an individual’s performance and potential
in three levels. This model shows which employees are underperformers, valued specialists, emerging
potentials or top talents. This metrics is great for differentiating between, for example, wanted and
unwanted turnover.
•Billable hours per employee
This is the most concrete example of a performance measure, and it is especially relevant in
professional service firms (e.g. law and consultancy firms).
•Engagement rating
An engaged workforce is a productive workforce. Engagement might be the most important ‘soft’ HR
outcome.
 WHY HR METRICS MATTER?
Human Resource metrics are measurements that help you to track key areas in HR data. The most
important areas are listed below. In this list of HR metrics, we included the key HR metrics
examples associated with those areas.
1.Organizational performance
1. Turnover percentages
2. % of regretted loss
3. Statistics on why personnel is leaving
4. Absence percentages and behavior
5. Recruitment (time to fill, number of applicants, recruitment cost)
 WHY HR METRICS MATTER?
2. HR operations
1. HR efficiency (e.g. time to resolving HR self-service tickets)
2. HR effectiveness (e.g. perception of HR service quality)

3. Process optimization
Process optimization helps to analyze how we do what we do in Human Resource Management.
The HR metrics and analytics in this area focus on changes in HR efficiency and effectiveness
over time. These HR metrics and analytics are then used to re-engineer and reinvent what is
happening in HR. This helps to optimize the Human Resource delivery process.
Process optimization metrics are next-level. They are still very rare in modern organizations as
they require a very high level of both data maturity and analytics maturity.
 Thank you