The good news if you’ve implemented human resource (HR) software at your small business is you have access to more HR metrics than ever before. The bad news? You have access to more HR metrics than ever before.
Becoming data-driven by using HR analytics is vital in the modern business world, but the problem of “data overload” is nearly impossible to avoid. HR departments simply don’t have the time or manpower to stay on top of all of the workforce data at their disposal.
HR dashboards can help. By allowing users to see a handful of key performance indicators (KPIs) at a glance, HR dashboards are the ideal tool to quickly gauge the health of your workforce in real time, giving you insight into the problem areas you need to address right away.
5 HR metrics that should be in every HR dashboard
Even the best dashboards have their limits though. As an HR manager, you have to decide which metrics you want to track in your dashboard and which you can afford to forego.
To help, here are five essential HR metrics you should track.
1. Turnover rate
If a single source of truth for the health of your workforce exists, it’s employee turnover rate. If employees aren’t lasting long at your business, this points to major flaws in who you’re hiring, how you’re supporting employee needs, or both.
High voluntary turnover is also one of the more expensive problems you can have as a business. Bleeding businesses of $1 trillion every year, the cost to find, hire, onboard, and train a new worker to replace one who left can range from 50% to 200% of that employee’s salary.
If you notice employee turnover increasing over time, survey workers to diagnose the issue. Anything from your compensation structure to your benefits package or even your managers could be the reason employees are leaving prematurely.
2. Employee net promoter score (eNPS)
Are your workers doing the bare minimum to get their paycheck, or are they passionate about their jobs and your company’s mission? If you’re not sure, employee net promoter score (eNPS) will tell you.
Borrowed from the world of customer service, eNPS is the simplest way to measure employee engagement. Why should you care? Because companies with engaged workforces have been proven to outperform the competition.
To measure eNPS, you need to send out a pulse survey to your employees with one simple question: “On a scale from zero – 10, how likely are you to recommend working at this company to a friend?”
Anyone who answers from zero to six is a detractor; they’re actively against advocating for you as a great employer. Sevens and eights are neutral, while nines and tens are your promoters. Your promoters are your most engaged workers.
Once you’ve run the numbers, subtract the percentage of the total that are promoters from the percentage of the total that are detractors to get your eNPS:
If you have a positive eNPS, even a small one, that’s good news. If you have a negative eNPS, that’s bad news. Running this pulse survey regularly and getting an updated eNPS in your dashboard will tell you if there’s work to be done to make your employees more engaged in their day-to-day.
3. Offer acceptance rate
There’s a slew of recruiting metrics you can track to gauge the success of your recruiting efforts. If you can only make room for one in your HR dashboard, though, make it offer acceptance rate.
Offer acceptance rate is the ultimate indicator if your pitch as an employer is working or not. If a high percentage of your job applicants are making it to the last step of your recruiting workflow but not signing on the dotted line, it could indicate a number of issues:
- Your employer brand doesn’t align with what job seekers expect or desire.
- Your candidate experience is so cumbersome or frustrating that it’s souring job applicants on your business as a place to work.
- Your compensation package isn’t competitive for your job market.
Keeping one eye on your offer acceptance rate at all times can help ensure you’re attracting—and securing—top talent for your organization.
4. Total overtime cost
As important as it is to hire the right people, it’s equally important to ensure you have enough people, and that you’re allocating them efficiently. If you’re not doing so, that will be reflected in total overtime cost.
Overtime is a particularly expensive cost that businesses want to avoid, as the extra wage pay is compounded by added costs in taxes and workers’ compensation. If your overtime costs are growing, you likely need to hire more people or do a better job of optimizing employee schedules.
Employee scheduling software is particularly helpful with that second problem. Input the employees you have, their preferred work schedules, PTO, certifications, and any other important factors, and the software will automatically create an optimized shift schedule that balances worker needs and keeps overtime to a minimum.
5. A metric for your top HR initiative
Every HR department has different initiatives and different goals related to the success of those initiatives. Whatever your top initiative is for the near future, you have to include relevant data to track your progress toward that initiative in your HR dashboard.
If diversity and inclusion is your top priority, include a metric related to diversity hires or the number of non-white and non-male employees in leadership roles. If it’s learning and development, track training course enrollment and completion rates. And if it’s employee performance, monitor employee performance review ratings.
Whatever your primary goal as an HR department is, be sure to include a metric tied to its success in your HR dashboard.
Final tips for creating a useful HR dashboard
The transition to analytics and data hasn’t been an easy one for HR departments used to operating on gut-feel and intuition. However, HR leaders recognize this change is necessary. In a survey of HR leaders worldwide, 89% agreed that they could use HR metrics to plan the future of their workforce. Only one percent disagreed.
A great HR dashboard template from your HR software vendor will give you the blueprint, but there’s still customization to be done if you want a good high-level overview of your company to enact data-driven decisions.
Here are some final tips to get your HR dashboard into a useful state:
- Integrate your dashboard with the right HR data sources. Having to manually update your dashboard regularly is a painstaking process that wastes a lot of time. If there’s data you want to track that isn’t stored in the same system as your dashboard, integrate your dashboard with the sources of that data (your payroll system, attendance system, etc.) to automate dashboard updates as much as possible.
- Bake in prescriptive thresholds. At what point is a metric too high or too low, meaning you should act? Where possible, add thresholds to the visualizations in your dashboard to indicate when you’ve achieved a goal or reached a breaking point that demands immediate attention.
- Create a separate HR dashboard for reporting to leadership. Naturally, the CEO and other C-suite members want updates on HR metrics that are important to them. Many metrics will overlap with the ones you need to monitor, but some won’t. In order to satisfy their needs without complicating your day-to-day view, create a separate dashboard for high-level stakeholders outside of your department.
Note: The applications selected in this article are examples to show a feature in context and are not intended as endorsements or recommendations. They have been obtained from sources believed to be reliable at the time of publication.