While HR trends come and go, one continues to build momentum: leveraging HR metrics. In fact, a recent survey found that most executives and HR leaders agree that measuring the effectiveness of HR strategies via data is critical to ensuring an organization’s success.
While HR metrics, or human resources metrics, can be used to track any aspect of human capital, they’re especially strategic for better understanding a business’s employee lifecycle.
What is the Employee Lifecycle?
The employee lifecycle is an organizational model that refers to the different phases an employee moves through during their time at a company. Depending on the model, some employee lifecycles may have five or six distinct phases: These are:
- Attraction and recruitment: Some models separate these into two different phases. However, they simply refer to how organizations fill their talent pools with active candidates.
- Onboarding: This phase occurs when an employee is hired and begins their journey with an organization.
- Development: In this phase, employees are encouraged to prioritize professional learning, skill development and career pathing.
- Retention: Organizations want to ensure their employees want to stay with their company. While company culture is a large component in this phase, so is engagement and making sure people have clear, defined professional goals.
- Separation: Occasionally known as “off-boarding,” the employee lifecycle ends when an employee leaves an organization.
ChartHop's people analytics powers your people strategy with visually-rich data insights.
Metrics That Matter, At Every Phase
From recruitment through separation, these easy HR metrics can help you and your teams measure the effectiveness of your HR initiatives:
Attraction and Recruitment
Tracking your recruitment efforts is an important metric to assess how much time, money, and resources your business is investing during this phase. It can also help you identify if you’re hiring the right people at the right time. One of the simplest HR metrics used to do this is time-to-fill.
Time-to-fill refers to how long it takes for a business to fill an open role. It encompasses the entire hiring process, from when a requisition is created, to when a candidate accepts an offer. Traditionally, calculating time-to-fill simply requires adding up the number of calendar days of all your vacant jobs, then dividing by the number of positions filled. Below is a simple formula:
<(time to fill position 1 + time to fill position 2 + ... + time to fill position n)/# of roles recruited for in that time period = Time to Fill>
For attraction and recruitment, time-to-fill is a critical metric: it can help recruitment teams better understand their employer brand, their sourcing strategies and their talent acquisition process. If time-to-fill is particularly high, it could be an indicator any of these efforts might need to be reconsidered.
ChartHop's people analytics reporting enables you to track useful metrics like offer letter acceptance rates.
It can also be used to inform planning. When requisitions are posted, management teams across a business can look back at how long it took to fill past roles and ensure their teams have the bandwidth and resources they need to work efficiently until that person is hired.
The first 90 days of an employee’s experience are the most important. In fact, studies show 33 percent of talent quit within the first 90 days of starting a new job.
That being said, having the HR metrics available to create a data-driven onboarding strategy is crucial for avoiding early turnover. A simple metric to better understand the onboarding phase is time to productivity. This allows you to see exactly how fast your new hires take to get ramped up, which provides insights into if they’re being engaged and supported enough.
Unlike time-to-fill, which has an exact formula to follow, time to productivity is more subjective.
One easy way to calculate it, however, is by setting distinct 30, 60, and 90-day goals for new hires. Then, you can calculate the total number of days it takes for a hire to complete those goals from their start date.
With ChartHop, you can collect employee goals and KPIs and visualize them on the org chart
When creating job descriptions, some companies opt to include objectives that a candidate will achieve within that time frame. This is a good way to level-set expectations form day one. It also provides an estimate of how long it takes for them to achieve their KPIs and, when averaged across similar roles on a team, can help inform onboarding strategies for the long haul.
After your employees hit their first 90 days, they enter the development phase. This phase prioritizes training and ongoing professional development across all levels.
This means leadership is properly armed with the tools and training they need to develop their teams. Be it through internal training sessions, external courses or rigorous reviews, businesses should invest in their managers so they can go back and motivate their people.
Individual contributors also need to have the tools and training they need to reach their professional goals. Whether this is through ongoing 1:1s with managers, quarterly performance reviews, or professional development opportunities, employees should always have a clear path towards the next step.
With ChartHop's robust people analytics reporting, you can glean granular insights from promotion rate data.
While some of this is subjective to measure, there are HR metrics you can leverage to better understand your development phase and how it’s functioning. An easy HR metric to employ is promotion rate, or the percentage of employees promoted in a given time. At the highest level, promotion rate can be calculated using the formula below:
<(total # of promotions / total # of employees) x 100 = promotion rate>
However, this should be customized at the team and department levels, and leveraged by everyone -- not just HR leaders. Giving your people -- executives, HR leaders and managers -- access to these granular details via a platform like ChartHop can inform strategic decision-making around professional development, skills mapping, career pathing, and managerial training and in turn, drive better business results.
HR leaders know the importance of keeping top talent. As the backbone of your company, you want to ensure you’re doing everything in your power to engage, challenge and grow your employees.
Surveys, eNPS scores, polls and 360-reviews can help you get a pulse on your employee’s engagement and satisfaction levels. But if you want to really quantify engagement, absenteeism rate is a good place to start.
Absenteeism is healthy and normal in any organization - people get sick, take vacations, and have other personal matters to attend to. But it’s habitual absenteeism that can lead to costly and harmful outcomes, particularly turnover.
This HR metric allows you to measure employee absenteeism and pinpoint where unhealthy levels of absenteeism may be occurring. Using the formula below, companies can see employee absenteeism from the organizational level, or dive deep into teams and departments to look for specific red flags and address engagement issues.
<(# of unexcused absences/total period) x 100 = absenteeism rate>
Like absenteeism, separation in any organization is healthy and natural -- it’s when it becomes a frequent occurrence that it becomes a concern.
Turnover is a key indicator of company culture, engagement and company growth. It’s also costly and can seriously hinder businesses reaching their objectives. When there is high turnover, particularly high voluntary turnover, companies need to take action. That’s when turnover rate comes into play.
Get to the bottom of your turnover rates with ChartHop's people analytics reporting.
This is another HR metric that can be calculated with a simple formula:
<(# of separations that occur/# of employees) x 100 = turnover rate>
Similar to the other HR metrics mentioned above, this formula is great for a birds-eye view of the entire organization. But it’s really valuable when you get specific and apply it to certain teams, departments or roles.
You can also sub-in the number of voluntary separations that occurred to gauge a sense of voluntary turnover rate versus involuntary turnover rate. Then, if rates are high, you can investigate further and avoid high rates of attrition down the line.
The Bottom Line
HR metrics are key to understanding the ins-and-out of your business’s employee lifecycle. From recruitment strategies, to optimizing professional development plans, to ensuring people are engaged and happy with their work, these HR metrics can help you be more strategic at every phase.
The best part is, they can all be collected, analyzed and shared using technology like ChartHop. By centralizing these HR metrics and making them accessible to the right people, you’re empowering your leaders to enhance your employee lifecycle now, and for the future.