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Making metrics relevant

Making metrics relevant DEPARTMENTS AT A GLANCE STRATEGIC COMMENTARY METRICS e-HR HOW TO… PRACTITIONER PROFILE The latest ideas on how to approach METRICS measurement and evaluation of HR activities HR AT WORK REWARDS RESEARCH AND RESULTS he desire to be more professional partnership with line managers. The ANDREW MAYO in the area of measurement is a three that typically feature in a Andrew Mayo is director of Mayo Learning Tgrowing interest for today’s HR balanced scorecard are attrition rates, International and professor of human capital function. It has been stimulated from a absenteeism rates and employee management at Middlesex University. number of quarters. One of them is a opinion survey results. Added to these andrew.mayo@mayolearning.com commercial drive by the suppliers of HR is a host of statistics and ratios: actuals software, who suggest to clients the vs budgets for headcount and employee that relate to specific groups of people variety of indicators they can get from costs; training days per person; influenced by a manager or management their products. In the UK, another is the percentage of people “highly satisfied” team at the operating level. If we publicity created by the DTI’s Accounting – there are hundreds of possibilities. recognize the truth of “people as our for People Report and the forthcoming most important assets,” surely it’s vital Operating and Financial Review. The Internal vs. external data that managers have some statement of CIPD has produced its own guidance This brings us to the second important what’s happening to these assets on a papers on external and internal distinction – who is going to take action regular basis, alongside financial reporting. Finally, the almost universal as a result of these indicators? The DTI statements. What managers need is to desire of the HR function for stronger recommendations are aimed at investors, see how these metrics link together and business partnership is a stimulus to be both current and potential. Depending influence each other. They also want the more “business-like” – and that must on their belief in the importance of measures to be relevant to their situation, include a more numeric approach to HR people, they will be interested in not a set which has been corporately management. employment policies, and should see an defined “in the interests of simplicity.” upside in good retention, investment in It’s up to the HR function to facilitate Where’s the value? development, attention to diversity, and these measurement frameworks. Like All this adds up to some confusion as to satisfied/motivated employees. What other support functions, HR has a what will really add value and to they’re likely to get is a consolidation of tendency to be internally focused and whom. There are two sets of highly variable indicators from different anxious that it is taken seriously. It will distinctions that can help. The first is to parts of the organization – but help to make a clear distinction distinguish between the HR scorecard nevertheless of some value. between HR’s “functional added value” and people-related measures. The Consolidated figures for senior and the value that people throughout former is about the efficiency and management however may be dangerous the organization can add to different effectiveness of the HR function – it as they hide variation, and it could be stakeholders. Business partnership helps to keep this separate from that strategically critical areas have requires that, amongst other things, HR statistics and ratios about the workforce problems. The top team should want to can provide managers (and itself. This scorecard is about service see the indicators broken down by management) with sets of numbers that levels and process measures such as subsidiary and department. The measures tell them what’s happening with people cost/recruit, learning plans implemented they want to know about may not be the so they can manage them more or percentage take-up of self-service same as those they are required to – or effectively and, in the end, achieve options. are willing to – publish. The internal higher performance. People-related measures embrace a framework will almost certainly be more References 1. www.accountingforpeople.gov.uk range of indicators about people in the extensive than the external. 2. www.dti.gov.uk/cld/financialreview.htm organization. Whereas HR should influence these through its policies and Metrics for managers Andrew Mayo is the author of The Human Value of the Enterprise Nicholas Brealey Publishing, 2001 training, they are the result of The real value however is in indicators Volume 4 Issue 1 November/December 2004 7 http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Strategic HR Review Emerald Publishing

Making metrics relevant

Strategic HR Review , Volume 4 (1): 1 – Nov 1, 2004

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Publisher
Emerald Publishing
Copyright
Copyright © Emerald Group Publishing Limited
ISSN
1475-4398
DOI
10.1108/14754390480000570
Publisher site
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Abstract

DEPARTMENTS AT A GLANCE STRATEGIC COMMENTARY METRICS e-HR HOW TO… PRACTITIONER PROFILE The latest ideas on how to approach METRICS measurement and evaluation of HR activities HR AT WORK REWARDS RESEARCH AND RESULTS he desire to be more professional partnership with line managers. The ANDREW MAYO in the area of measurement is a three that typically feature in a Andrew Mayo is director of Mayo Learning Tgrowing interest for today’s HR balanced scorecard are attrition rates, International and professor of human capital function. It has been stimulated from a absenteeism rates and employee management at Middlesex University. number of quarters. One of them is a opinion survey results. Added to these andrew.mayo@mayolearning.com commercial drive by the suppliers of HR is a host of statistics and ratios: actuals software, who suggest to clients the vs budgets for headcount and employee that relate to specific groups of people variety of indicators they can get from costs; training days per person; influenced by a manager or management their products. In the UK, another is the percentage of people “highly satisfied” team at the operating level. If we publicity created by the DTI’s Accounting – there are hundreds of possibilities. recognize the truth of “people as our for People Report and the forthcoming most important assets,” surely it’s vital Operating and Financial Review. The Internal vs. external data that managers have some statement of CIPD has produced its own guidance This brings us to the second important what’s happening to these assets on a papers on external and internal distinction – who is going to take action regular basis, alongside financial reporting. Finally, the almost universal as a result of these indicators? The DTI statements. What managers need is to desire of the HR function for stronger recommendations are aimed at investors, see how these metrics link together and business partnership is a stimulus to be both current and potential. Depending influence each other. They also want the more “business-like” – and that must on their belief in the importance of measures to be relevant to their situation, include a more numeric approach to HR people, they will be interested in not a set which has been corporately management. employment policies, and should see an defined “in the interests of simplicity.” upside in good retention, investment in It’s up to the HR function to facilitate Where’s the value? development, attention to diversity, and these measurement frameworks. Like All this adds up to some confusion as to satisfied/motivated employees. What other support functions, HR has a what will really add value and to they’re likely to get is a consolidation of tendency to be internally focused and whom. There are two sets of highly variable indicators from different anxious that it is taken seriously. It will distinctions that can help. The first is to parts of the organization – but help to make a clear distinction distinguish between the HR scorecard nevertheless of some value. between HR’s “functional added value” and people-related measures. The Consolidated figures for senior and the value that people throughout former is about the efficiency and management however may be dangerous the organization can add to different effectiveness of the HR function – it as they hide variation, and it could be stakeholders. Business partnership helps to keep this separate from that strategically critical areas have requires that, amongst other things, HR statistics and ratios about the workforce problems. The top team should want to can provide managers (and itself. This scorecard is about service see the indicators broken down by management) with sets of numbers that levels and process measures such as subsidiary and department. The measures tell them what’s happening with people cost/recruit, learning plans implemented they want to know about may not be the so they can manage them more or percentage take-up of self-service same as those they are required to – or effectively and, in the end, achieve options. are willing to – publish. The internal higher performance. People-related measures embrace a framework will almost certainly be more References 1. www.accountingforpeople.gov.uk range of indicators about people in the extensive than the external. 2. www.dti.gov.uk/cld/financialreview.htm organization. Whereas HR should influence these through its policies and Metrics for managers Andrew Mayo is the author of The Human Value of the Enterprise Nicholas Brealey Publishing, 2001 training, they are the result of The real value however is in indicators Volume 4 Issue 1 November/December 2004 7

Journal

Strategic HR ReviewEmerald Publishing

Published: Nov 1, 2004

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