Take a look around your HR department. How different are operations compared to as recently as 2007? Unless your company literally resides under a rock, chances are the landscape has changed in more ways than one. The 2008 recession, the skill gaps left by retiring Baby Boomers and increasing globalization have all contributed to the way we see things today. While most of us in HR would agree we spend a significant amount of time on administrative and compliance tasks, we also know that it’s critical for HR to be integral in planning the business strategy.
For most organizations, compensation and labor costs can represent 80 percent of business cost. The viability and success of business is directly tied to how effective the organization is at talent management. Metrics for measuring HR’s effectiveness are an integral part of a successful talent management strategy, but they make up only part of the equation.
The Center for Effective Organizations has identified four components of a measurement system that drive strategic change and organization effectiveness: logic, analysis, measures, and process. Three anchor points help connect decisions about an organization’s resources to organizational effectiveness: efficiency, effectiveness, and impact.
Efficiency – Resources you use to produce your HR policies and practices. Indicators include cost-per-hire and time-to-fill.
Effectiveness – The effects of your HR policies and practices on productivity and alignment with targeted talent pools. Indicators of effectiveness include new employees’ increased knowledge and better-selected applicants.
Impact – Differences in availability and quality of talent pools, and the way it affects your organization’s strategic success.
Most of us are pros at measuring efficiency, and many of us have a grasp on effectiveness, but where do you stand in measuring impact? In a survey SHRM conducted repeatedly from 1995 to 2010, they found that “High-performing HR departments separate themselves from the rest by the strategies they use and develop with respect to talent and HR management. High-performing HR departments have data-based talent strategies integrated with the business strategy, while low performers do not.”
Although strategically-minded HR executives are spending less time on administrative tasks, the most effective leaders keep compliance, legal requirements, and basic administration in mind as well. Agile Product Solutions has the answer to help you succeed with achievement based profiles that show your candidate pools what they need to be successful in the position, while providing robust compliance reporting tools.