Vvmurugan
Hr Generalist
Yuvarajah
Hr Manager
Nsattar
Senior Recruitment Specialist

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Hello Guys,
Am doing an HRM Diploma research focusing on Performance Management.
As i know that we use job descriptions to get performance Objectives, and we use performance objectives to get KPI's.
1. But i dont really get.... for example for the HR Manager , one of the performance objectves is to reduce the turnover in the company, what would be the KPIs for that objective???
2. Is the KPIs, the elements we use in the Performing Apprasial Form such as Job Knowledge, quality of work ??
3. If Is the KPI something like a breakdown of the objective???
4. Am i asked in my research to have 5 performance objectives for 3 positions.
I would really appreciate ur answers,
Thanx
Nsattar
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KPI's are derived from KRA's. In this case, Turnover is a KRA which is why it is identified as a key objective for HR to address. One way to learn how to rationalise KPI's is to ask, "How would I know if I have achieved the objective".

There are many people out there who have made KPI look like some demonic measure for superior to monitor their subordinate performance, hence end-up being top driven. I would like to treat KPIs' as more a self-motivation tool whereby job incumbants can collaboratively challenge their capacity and measure their performance output progressively. If it is tied to an appraisal system, then I would say it as purely incidental by choice of design.

So, what would constitute as KPI for turnover. In absolute terms it depends on what you want to benchmark against. Do you want to use the industrial or national turnover target or simply the comparative basis over the past years. Alternatively, you may want to draw other sub-KPi's as a representative measure to address the "sources" of turnover such as Employee Satisfaction, Employee Complaints, Employee Engagements, Market Salary Allignment, Leadership abuse, etc. When you see it from this angle, you will begin to appreciate why exit interviews and open employee feedback instruments are vital.

Sometimes leaders forget why they need to set "intelligent" KPIs. They keep their sights on the forest and forget the trees (initiatives and actions) which is what brings the real impact on achieving the performance objectives. To me turnover targets has more to do with internal retention strategies than external market conditions.

What benefit would absolute "turnover" figure serve if you retain people who are there for the money, doing "satisficing" work, earn a salary to pay bills, buying company time to weather the current tough economic situation.

Therefore, be wise in selecting and using KPIs. What exactly are you trying to measure and against what. Learn to simply ask, "Would absolute or comparative figures give useful meaning to the performance objective I have identified?"

Yuva
Yuva,
Thank you very much for this input. I just want u now to verify my below understanding:
For example:
For the HR Manager, one of the Performance Objective is to (Increase overall department effieciency by 20% by the end of Q4)
KRA - Recruitment and Selection
KPI - Reduce the bad hiring rate.
Minimize the no. of days to recruit a candidate
KRA - Training and Development
KPI - Provide a minimum of 2 training courses for all employees
KRA - Compensation and Benefits
KPI - Benchmark the salaries of the employees with the market.
This is how i got it... is this right?
Thanks again.
Nsattar
Dear All,
KRA & KRI may be compared to Raw materials/Input and End or Finished products. In a process if there is good and well defined INPUT then the OUTPUT will always be fine and good.........
regards
v.v.murugan
Nsattar,

Before I go further, have you given thought as to how you would literally calculate the 20% efficiency.

I am going to assume you know the difference between effectiveness and efficiency in setting the objective. Hence, your focus would be to achieve 20 % efficiency in HR operations. The typical measures associated with performance efficiency are quality, time and cost.

Recruitment and Selection.

1. Try to use the positive intent, as opposed to negative. Instead of reduce, say increase % of good hiring. No of days to fill a position or even reducing cost down are all acceptable KPIs.

2. BTW, can you explain what is meant by bad hires?. Are you refering to failure of candidates at interviews or failure to be confirmed?. If it's the latter, would it be a KPI for HR or co-owned by the HOD. Central to this debate is who has control of final infuence in decision making over performance during the interview and at work.

Training & Development

Putting numbers to training is, in my opinion, not an intelligent KPI. This shows you don't do the right (effective) thing. When you use number of training, days, or hours it conveys you are sending people for training for the sake of fulfilling a WANT, not a customised need of the individual. If you have a competency model in place then you should use it. If there are mandatory core trainings, then its fine. You also have to rely on a TNA to identify what is lacking in people and system. I would advice you to "rigourize" the entire learning engagement. Have you heard of IDP? Start rolling it out because its a better and effective KPI.

Compensation and Benefits

I would suggest using the benchmark against market value as a measure of equity accuracy. Would doing it as many times reflect or mean higher rate of accuracy.

Hope the above helps.

Thanks
Yuva
Yuva,
Sorry for the late reply, Thanks a lot for your support.
What i meant by the cost of bad hiring is:
- The Recruiter's time / salary
- Advertisment Cost
- Termination Cost
- Expenses (Insurance/ Training)
- Bad work performance (If dealing with external customers)
- Replacement Cost
Nsatar
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