People analytics is a huge topic in the world of HR. As data becomes increasingly accessible, organizations want to use it to inform all of their business decisions, including decisions related to people resources. But with so much data available, it can become overwhelming to decide what to focus on and how to use it. To point you in the right direction, we asked a number of prominent HR influencers the following question: What's the most important metric for a people analytics function to address? Check out the insights below:
“Turnover. HR usually owns Turnover but every single employee that turns in your organization adds work to Talent Acquisition, not HR. Great TA functions control turn because it means one less person to recruit. Stop people from leaving and all of sudden you become great at recruiting.”
“The most important metric for people analytics to focus on is a core business KPI, not an HR metric, otherwise talent and HR leaders run the risk of being perceived as out of touch with business needs.”
“I don't believe there is a "the most important" because there are many data points that paint a needed picture. However, if there is a compelling area, it would be retention -- why people are leaving and why are they staying.”
“Because I believe people are responsible for their own engagement it is vital that they get a daily metric of their shifting levels of employee or work engagement so they can know their level and determine when and how adjustments need to be made to improve or enhance their work engagement.”
“Because talent is a key differentiator in business, I believe recruiting metrics are valuable. One that I feel is underutilized is yield ratios, which shows the percentage of candidates at the beginning of a step in the process who move on to the next step. The results can tell you a lot about your recruiting funnel and the effectiveness of your strategies.”
“I think a lot of it depends on where the organization is in its evolution, but one of the critical things to always measure is: The number of internal hires/promotions vs. external hires…. A good indicator of whether or not you’re “growing” your own talent.”
“The most important metric to track is retention percentage to see where people are staying and why. It's a more reliable metric than measuring turnover.”
“Measure everything and make sure they are actionable analytics. This includes time-to-fill, time-to-productivity, retention, employee engagement, length of tenure for each team/department, along with job candidate feedback and customer engagement and retention.
It's also important to understand the KPIs of high performing employees and create those profiles that will serve to make better hires. Additionally, organizations should identify the KPIs of high performing managers. Middle management is often overlooked in this regard, with companies overseeing the performance levels of direct reports without considering the performance of the managers.”
"The most critical metric to address in today's competitive marketplace is any metric that supports an organization's business growth and income stream. That means that an accurate organizational measure of productivity is critical or a differentiation when it comes to high performing employees (what makes a top seller, top product designer, top engineer etc.) will always attract the attention of the C Suite. For me, it's about using the data available to an organization and providing performance insights that will change the way that an organization thinks and operates."
“Turnover is the most important especially when broken down into voluntary and involuntary. There are reasons for both that can be attributed to management but some involuntary is simply the nature of the beast. The real measure is voluntary as it relates to retention. Reasons for high turnover must be addressed. It's costly to the organization in so many ways.”
Clearly, turnover and retention are top-of-mind, although other important topics were brought to light as well. Regardless of which metrics you select, the entire point of analyzing them is to see if you can improve them! Review the insights from these influencers, select your metrics and baselines, and then conduct tests to see if you can move the needle. What common mistakes can be fixed to reduce turnover? What initiatives can you pursue to increase engagement?