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Hi sfkmujahid, Some of the KPIs for the HR Department could be Employee Turnover, Employee Satisfaction, Absenteism, Staff Competency. Regards, Leena
From India, Delhi
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From India, Delhi
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I am a new entrant in the field of HR. So can you pls tell me wat does KPI stand for and wat is its significance in HR? Sorry for asking such a silly ques...
From India, Delhi
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From India, Delhi
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Hi Kankana,
Let me try to help you.
KPI stands for Key Performance Indicator. They are not specifically linked only to HRD but have to do with the entire organization. Each department/division of an organization usually has set and identified KPIs, which are measurable and quantifiable in nature to measure the success of the organization in terms of the organization's mission and goals. Hence, KPIs can be defined as measurements for an organization's success. KPIs are also known as KSIs, which stand for Key Success Indicators.
For instance, the HR Department could have Employee Turnover as one of its KPIs. The goal for setting this KPI would be to reduce employee turnover. It could be defined numerically for better definition, such as to reduce employee turnover by 5% every year. This KPI could be defined as the total of the number of employees separated from the organization for reasons of resignation or termination divided by the number of employees at the beginning of the year. It could be measured on a fixed time schedule like every month or every quarter.
I guess this will give you a basic idea. If you need any further clarification, feel free to ask.
Regards,
Leena
From India, Delhi
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Let me try to help you.
KPI stands for Key Performance Indicator. They are not specifically linked only to HRD but have to do with the entire organization. Each department/division of an organization usually has set and identified KPIs, which are measurable and quantifiable in nature to measure the success of the organization in terms of the organization's mission and goals. Hence, KPIs can be defined as measurements for an organization's success. KPIs are also known as KSIs, which stand for Key Success Indicators.
For instance, the HR Department could have Employee Turnover as one of its KPIs. The goal for setting this KPI would be to reduce employee turnover. It could be defined numerically for better definition, such as to reduce employee turnover by 5% every year. This KPI could be defined as the total of the number of employees separated from the organization for reasons of resignation or termination divided by the number of employees at the beginning of the year. It could be measured on a fixed time schedule like every month or every quarter.
I guess this will give you a basic idea. If you need any further clarification, feel free to ask.
Regards,
Leena
From India, Delhi
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HR Key Performance Indicators
Frequently used HR Key Performance Indicators include:
FTE = full time employees
Revenue per Employee (FTE)
Assets per FTE
Training Hours per FTE
Training Costs per FTE
HR Department Cost per FTE
FTEs per HR Department FTE
Acceptance Rate
Average Cost per Hire
Absence Rate
Turnover Rate
Resignation Rate
Human Investment Ratio
Compensation & Benefits/Revenue
Average Remuneration
Time taken per recruitment
Cost per recruitment
THE CHOICE OF HR KPI WILL VARY FROM YEAR TO YEAR,
SUBJECT TO COMPANY'S
-STRATEGIC PLANNING
-CORPORATE STRATEGIES
-CORPORATE OBJECTIVES
WHICH IN TURN AFFECTS THE HR'S
-HR STRATEGIC PLANNING
-HRM STRATEGIES
-HRM OBJECTIVES
-------------------------------------------------------
The HR Balanced Scorecard is the measurement tool. It provides the management with a tool and a process to measure the performance of people practices and the HR function from multiple perspectives:
1. Strategic Perspective — the results of strategic initiatives managed by the HR group. The strategic perspective focuses on the measurement of the effectiveness of major strategy-linked people goals. For instance, the business strategy called for major organizational change programs as the business faced major restructuring and multiple mergers and acquisitions. In this context, the organization’s change management capability will be a key factor in the success or failure of its execution. Therefore, measuring the ability of the business to manage change effectively is the core measure of the effectiveness of HR and will be a key strategic contribution to the future success of the business.
EXAMPLES
-change management capability of the organization
-organization compensation and benefit package with respect market rate.
-organization culture survey
-HR BUDGET / ACTUAL
-HR COSTS BENCHMARK EXTERNALLY
-HR annual resource plan.
-skills/ competency level
etc
2.Operational Perspective — the operational tasks at which HR must excel. This piece of the Balanced Scorecard provides answers to queries about the effectiveness and efficiency in running HR processes that are vital to the organization. Examples include measuring HR processes in terms of cost, quality and cycle time such as time to fill vacancies.
EXAMPLES
-time taken to fill vacancies
-cost per recruitment promotions
-absenteeism by job category
-accident costs
-accident safety ratings
-training cost per employee
-training hours per employee
-average employee tenure in the company
-lost time due to injuries
-no. of recruiting advertising programs
-no. of employees put through training.
-turnover rate
-attrition rate
etc
3.Financial Perspective — this perspective tries to answer questions relating to the financial measures that demonstrate how people and the HR function add value to the organization. This might include arriving at the value of the human assets and total people expenses for the company. HR
EXAMPLES
-compensation and benefits per employee
-sales per employee
-profit per employee
-cost of injuries
-HR expenses per employee
-turnove cost
-employee '' workers compensation costs''
etc
4.Customer Perspective — this focuses on the effectiveness of HR from the internal customer viewpoint. Are the customers of HR satisfied with their service; are service level agreements met; do the customers think they can get better service elsewhere? Conducting an HR customer survey might typically arrive at this.
EXAMPLES
-employee perception of the HRM
-employee perception of the company , as an employer
-customer/market perception of the company, as an employer.
etc
All four components of the scorecard are used to define and measure the effectiveness of people-management activities and how the HR function executes them. This provides a strategic measurement and management process to show the connection between a company’s business strategies and goals and its HR strategies, activities, and results. The Balanced Scorecard can provide an ideal approach to measure the contribution that human resource management makes to business success.
With the HR Balanced Scorecard in place, it can assist organizations to easily monitor the workforce indicators that are key to their business success. Such solutions enhance HR’s ability to provide counsel to line management and deliver results that make a difference to the achievement of their goals and strategy and thereby to shareholders.
The apparent and inherent values that the HR Balanced Scorecard brings include:
Measurement provides the data and facts to support business decisions, giving credibility to HR recommendations and initiatives;
Collecting and using data to make decisionsregarding retaining and motivating the
workforce, giving the organization a competitive advantage in the marketplace;
The right mix of lead and lag measures helps the business assess its strategic
alignment and progress towards its objectives;
HR will be proactive in identifying potential improvements and bringing suggestions
to the business that improve bottom-line results; and
A business and linked measurement framework focuses activity on those tasks
that contribute to organizational success. This process lifts the role of HR from being viewed purely as a cost centre to that as strategic business partner.
regards
LEO LINGHAM
From India, Mumbai
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Frequently used HR Key Performance Indicators include:
FTE = full time employees
Revenue per Employee (FTE)
Assets per FTE
Training Hours per FTE
Training Costs per FTE
HR Department Cost per FTE
FTEs per HR Department FTE
Acceptance Rate
Average Cost per Hire
Absence Rate
Turnover Rate
Resignation Rate
Human Investment Ratio
Compensation & Benefits/Revenue
Average Remuneration
Time taken per recruitment
Cost per recruitment
THE CHOICE OF HR KPI WILL VARY FROM YEAR TO YEAR,
SUBJECT TO COMPANY'S
-STRATEGIC PLANNING
-CORPORATE STRATEGIES
-CORPORATE OBJECTIVES
WHICH IN TURN AFFECTS THE HR'S
-HR STRATEGIC PLANNING
-HRM STRATEGIES
-HRM OBJECTIVES
-------------------------------------------------------
The HR Balanced Scorecard is the measurement tool. It provides the management with a tool and a process to measure the performance of people practices and the HR function from multiple perspectives:
1. Strategic Perspective — the results of strategic initiatives managed by the HR group. The strategic perspective focuses on the measurement of the effectiveness of major strategy-linked people goals. For instance, the business strategy called for major organizational change programs as the business faced major restructuring and multiple mergers and acquisitions. In this context, the organization’s change management capability will be a key factor in the success or failure of its execution. Therefore, measuring the ability of the business to manage change effectively is the core measure of the effectiveness of HR and will be a key strategic contribution to the future success of the business.
EXAMPLES
-change management capability of the organization
-organization compensation and benefit package with respect market rate.
-organization culture survey
-HR BUDGET / ACTUAL
-HR COSTS BENCHMARK EXTERNALLY
-HR annual resource plan.
-skills/ competency level
etc
2.Operational Perspective — the operational tasks at which HR must excel. This piece of the Balanced Scorecard provides answers to queries about the effectiveness and efficiency in running HR processes that are vital to the organization. Examples include measuring HR processes in terms of cost, quality and cycle time such as time to fill vacancies.
EXAMPLES
-time taken to fill vacancies
-cost per recruitment promotions
-absenteeism by job category
-accident costs
-accident safety ratings
-training cost per employee
-training hours per employee
-average employee tenure in the company
-lost time due to injuries
-no. of recruiting advertising programs
-no. of employees put through training.
-turnover rate
-attrition rate
etc
3.Financial Perspective — this perspective tries to answer questions relating to the financial measures that demonstrate how people and the HR function add value to the organization. This might include arriving at the value of the human assets and total people expenses for the company. HR
EXAMPLES
-compensation and benefits per employee
-sales per employee
-profit per employee
-cost of injuries
-HR expenses per employee
-turnove cost
-employee '' workers compensation costs''
etc
4.Customer Perspective — this focuses on the effectiveness of HR from the internal customer viewpoint. Are the customers of HR satisfied with their service; are service level agreements met; do the customers think they can get better service elsewhere? Conducting an HR customer survey might typically arrive at this.
EXAMPLES
-employee perception of the HRM
-employee perception of the company , as an employer
-customer/market perception of the company, as an employer.
etc
All four components of the scorecard are used to define and measure the effectiveness of people-management activities and how the HR function executes them. This provides a strategic measurement and management process to show the connection between a company’s business strategies and goals and its HR strategies, activities, and results. The Balanced Scorecard can provide an ideal approach to measure the contribution that human resource management makes to business success.
With the HR Balanced Scorecard in place, it can assist organizations to easily monitor the workforce indicators that are key to their business success. Such solutions enhance HR’s ability to provide counsel to line management and deliver results that make a difference to the achievement of their goals and strategy and thereby to shareholders.
The apparent and inherent values that the HR Balanced Scorecard brings include:
Measurement provides the data and facts to support business decisions, giving credibility to HR recommendations and initiatives;
Collecting and using data to make decisionsregarding retaining and motivating the
workforce, giving the organization a competitive advantage in the marketplace;
The right mix of lead and lag measures helps the business assess its strategic
alignment and progress towards its objectives;
HR will be proactive in identifying potential improvements and bringing suggestions
to the business that improve bottom-line results; and
A business and linked measurement framework focuses activity on those tasks
that contribute to organizational success. This process lifts the role of HR from being viewed purely as a cost centre to that as strategic business partner.
regards
LEO LINGHAM
From India, Mumbai
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Some of the KPIs may be:
- Canteen Cost
- Employee Cost
- Safety (e.g., Number of Accidents, Mandays Lost)
- Absenteeism
- Mandays lost due to labor problems
- People Development (e.g., Number of Training Programs, Number of Participants, etc.)
- Employees involved in SGA
- Special projects (e.g., programs for Community Development, Environment Management, etc.)
Regards,
Aniruddh
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- Canteen Cost
- Employee Cost
- Safety (e.g., Number of Accidents, Mandays Lost)
- Absenteeism
- Mandays lost due to labor problems
- People Development (e.g., Number of Training Programs, Number of Participants, etc.)
- Employees involved in SGA
- Special projects (e.g., programs for Community Development, Environment Management, etc.)
Regards,
Aniruddh
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Hi there, I am Urvashi, a new entrant to this site. I work with Torrent Pharma and am currently responsible for the Performance Management System. I can assist you in understanding a few KPIs of the HR department. For example, if the KRA is:
1. Saving 20% of the budget for Recruitment Expenses, then the KPI could be:
- 20% (excellent)
- 15% (good)
- 10% (satisfactory)
- 7.50% (needs improvement)
2. Improving the Recruitment timeline (average) to 60 Days from vacancy creation, then the KPI could be:
- 45 Days (excellent)
- 60 Days (good)
- 75 Days (satisfactory)
- 90 Days (needs improvement)
KPI's are specific measures of KRA, indicating the successful achievement of the KRA. KPIs could be a percentage of decrease, an amount of time, a cost-saving, date of completion, among others. I hope this information helps you understand better.
Urvashi
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1. Saving 20% of the budget for Recruitment Expenses, then the KPI could be:
- 20% (excellent)
- 15% (good)
- 10% (satisfactory)
- 7.50% (needs improvement)
2. Improving the Recruitment timeline (average) to 60 Days from vacancy creation, then the KPI could be:
- 45 Days (excellent)
- 60 Days (good)
- 75 Days (satisfactory)
- 90 Days (needs improvement)
KPI's are specific measures of KRA, indicating the successful achievement of the KRA. KPIs could be a percentage of decrease, an amount of time, a cost-saving, date of completion, among others. I hope this information helps you understand better.
Urvashi
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Thanks a ton for your help in explaining the concept and the practices. Thanks to Leena, Anirudh, Leo, Urvashi and the others who have helped me get a better hang of the concept. Regards, Kankana
From India, Delhi
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From India, Delhi
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Dear Sir/Madam,
I am kindly requesting if someone could email me some HR KPIs. I am currently in the process of developing HR KPIs for our existing HR applications, but I am relatively new to this field. I would greatly appreciate it if I could receive some HR KPI templates, if possible. My email address is andrewlee2000@gmail.com.
Thank you very much.
Best regards,
Andrew
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I am kindly requesting if someone could email me some HR KPIs. I am currently in the process of developing HR KPIs for our existing HR applications, but I am relatively new to this field. I would greatly appreciate it if I could receive some HR KPI templates, if possible. My email address is andrewlee2000@gmail.com.
Thank you very much.
Best regards,
Andrew
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Hi Leena,
I really liked the way you answered this query. Please send me all the information you have on payroll (including PF & ESI) if you can. Also, please give me a brief introduction about yourself.
Sireesha V Deol
From India, Ahmadabad
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I really liked the way you answered this query. Please send me all the information you have on payroll (including PF & ESI) if you can. Also, please give me a brief introduction about yourself.
Sireesha V Deol
From India, Ahmadabad
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Hi Leena,
Thanks for the valuable information. Can you please let me know how to set the KPIs for certain areas that are not measurable? For example, the KRA is Implementation of HR Process & Policies - what would be the KPI for this KRA? Expecting your reply.
Thanks,
Suman
From India, Madras
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Thanks for the valuable information. Can you please let me know how to set the KPIs for certain areas that are not measurable? For example, the KRA is Implementation of HR Process & Policies - what would be the KPI for this KRA? Expecting your reply.
Thanks,
Suman
From India, Madras
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There are plenty of KPIs available for each department, but the real value and importance for any organization lie in selecting the right set of KPIs for individual functions. KPIs help ascertain the health of an organization and assist the top management in keeping a finger on the pulse of the organization.
Ambarish
From India
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Ambarish
From India
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When looking to fine-tune performance, determining metrics such as time spent on a page, the keywords used to deliver the traffic, which related keywords are relevant and overlapping. Determining the existing bounce rate or engagement metric for the page and what calls to action exist on the landing page in question.
Managing those factors allows you to create a base-level KPI analysis to improve performance individually or across all of these metrics simultaneously. However, without analytics or performance tracking, you are just grasping at straws when it comes to delivering or reproducing consistent or future sales volume.
Ambarish
From India
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Managing those factors allows you to create a base-level KPI analysis to improve performance individually or across all of these metrics simultaneously. However, without analytics or performance tracking, you are just grasping at straws when it comes to delivering or reproducing consistent or future sales volume.
Ambarish
From India
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The prime role of the Human Resources function is to support the achievement of organizational goals by ensuring that relevant and innovative people policies, practices and systems are in place so that the organization can attract, retain and develop outstanding staff. Below is a list of 75 KPIs a Human Resources department could use in order to track its performance regarding this role.
These metrics are split into 14 categories: recruitment, training, health & safety, performance, employee loyalty, working time, HR efficiency, compensation, labor relations, regulation compliance, employee satisfaction, HR budget, job leaving, workforce information.
1.Recruitment metrics
Recruitment cost per employee
Average time to recruit (per position)
Number of CVs per channel
Number of interviews per submitted CV
% new hires achieving 24 months service
% new hires achieving satisfactory appraisal after first assessment
2.Training KPIs
Training expenditures/total salaries and wages
% HR budget spent on training
% employees gone through training
Number of training hours per employee
Employee satisfaction index with training
e-learning course utilized
% e-learning pass rate
3.Health and safety metrics
Number of accidents per year
Percentage of employees with adequate occupational health & safety training
Health & safety prevention costs per month
Lost time (in hours) due to accidents per year
Percentage of issues raised by health & safety representatives
4.Performance KPIs
NB: Competence focuses on capability that includes knowledge, abilities, skills to perform tasks; while Performance focuses on result of tasks.
% of appraisals completed on time
% of employees above competence (and those below)
% of low performing employees (and for high performing)
% of employee with their performance decreased compared to last month (and increased)
5.Employee loyalty metrics
Employee turnover (total staff as recruited/total staff as planned)
Rate of life cycles of employees (total time served in the company of all staff/total staff recruited)
6.Working time indicators
% of total hours lost to absenteeismAverage overtime hours per person% of man days lost due to strikeTotal time lost by work lateLost time due to non-fatal accidents or accidents per year
7.HR efficiency metrics
Sales turnover per employee (or Full Time Equivalent: FTE)Profits per employeeAdministration cost per employeeLabor cost as % of sales
8.Compensation KPIs
Salary rate / sales turnover
Cost rate of workers compensation
Cost rate of social insurance
Cost rate of medical insurance
Cost rate of benefits
Average income per employee by month
Average income per employee by hour
Average income per employee by position
9.Labor relation metrics
Number of emails issued
Number of staff briefing sessions conducted
Number of teams meetings
Number of unfair dismissal claims
Number of active flexible work agreements
10.Regulation compliance KPIs
Number of violation per year (by sector). Metric to split: small, medium, strong violation.
Costing lost by violation
Time lost by violation
Violation rate by department
11.Employee satisfaction metrics
% average satisfaction (to be split by department, by position, by tenure, etc)
% average satisfaction by field (compensations and benefits, training, recognition, opportunities for development, leadership, work environment, personal relations, etc)
12.HR budget metrics
Average cost of recruitment per year
Average cost of recruitment per staff
Average cost of training per year
% training cost / sales turnover
Training cost per employee
Salary budget ratio / sales turnover
Health safety cost per year
Human resources cost per sales turnover
Compensation and benefit cost / sales turnover per year
13.Job leaving KPIs
Job leaving ratio per yearJob leaving ratio per departmentAverage age of employees that retirePercentage of early retirementsAttitude of employee who leave job (satisfaction ratio with the following: salaries, benefits, work environment, opportunities for development, personal recognition, job, personal relations, etc)
14.Workforce metrics
Number of FTEs in HR
HR FTEs as % of total workforce (FTEs)
Percentage of outstanding employee probation reports.
Number of Full Time Employees
Number of Part Time Employees
Number of employees per age category (with pyramid)
Average length of service (current employees)
Average length of service (terminating employees)
% ratio of salaried staff to waged staff
From India, Mumbai
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These metrics are split into 14 categories: recruitment, training, health & safety, performance, employee loyalty, working time, HR efficiency, compensation, labor relations, regulation compliance, employee satisfaction, HR budget, job leaving, workforce information.
1.Recruitment metrics
Recruitment cost per employee
Average time to recruit (per position)
Number of CVs per channel
Number of interviews per submitted CV
% new hires achieving 24 months service
% new hires achieving satisfactory appraisal after first assessment
2.Training KPIs
Training expenditures/total salaries and wages
% HR budget spent on training
% employees gone through training
Number of training hours per employee
Employee satisfaction index with training
e-learning course utilized
% e-learning pass rate
3.Health and safety metrics
Number of accidents per year
Percentage of employees with adequate occupational health & safety training
Health & safety prevention costs per month
Lost time (in hours) due to accidents per year
Percentage of issues raised by health & safety representatives
4.Performance KPIs
NB: Competence focuses on capability that includes knowledge, abilities, skills to perform tasks; while Performance focuses on result of tasks.
% of appraisals completed on time
% of employees above competence (and those below)
% of low performing employees (and for high performing)
% of employee with their performance decreased compared to last month (and increased)
5.Employee loyalty metrics
Employee turnover (total staff as recruited/total staff as planned)
Rate of life cycles of employees (total time served in the company of all staff/total staff recruited)
6.Working time indicators
% of total hours lost to absenteeismAverage overtime hours per person% of man days lost due to strikeTotal time lost by work lateLost time due to non-fatal accidents or accidents per year
7.HR efficiency metrics
Sales turnover per employee (or Full Time Equivalent: FTE)Profits per employeeAdministration cost per employeeLabor cost as % of sales
8.Compensation KPIs
Salary rate / sales turnover
Cost rate of workers compensation
Cost rate of social insurance
Cost rate of medical insurance
Cost rate of benefits
Average income per employee by month
Average income per employee by hour
Average income per employee by position
9.Labor relation metrics
Number of emails issued
Number of staff briefing sessions conducted
Number of teams meetings
Number of unfair dismissal claims
Number of active flexible work agreements
10.Regulation compliance KPIs
Number of violation per year (by sector). Metric to split: small, medium, strong violation.
Costing lost by violation
Time lost by violation
Violation rate by department
11.Employee satisfaction metrics
% average satisfaction (to be split by department, by position, by tenure, etc)
% average satisfaction by field (compensations and benefits, training, recognition, opportunities for development, leadership, work environment, personal relations, etc)
12.HR budget metrics
Average cost of recruitment per year
Average cost of recruitment per staff
Average cost of training per year
% training cost / sales turnover
Training cost per employee
Salary budget ratio / sales turnover
Health safety cost per year
Human resources cost per sales turnover
Compensation and benefit cost / sales turnover per year
13.Job leaving KPIs
Job leaving ratio per yearJob leaving ratio per departmentAverage age of employees that retirePercentage of early retirementsAttitude of employee who leave job (satisfaction ratio with the following: salaries, benefits, work environment, opportunities for development, personal recognition, job, personal relations, etc)
14.Workforce metrics
Number of FTEs in HR
HR FTEs as % of total workforce (FTEs)
Percentage of outstanding employee probation reports.
Number of Full Time Employees
Number of Part Time Employees
Number of employees per age category (with pyramid)
Average length of service (current employees)
Average length of service (terminating employees)
% ratio of salaried staff to waged staff
From India, Mumbai
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Unfortunately, huge lists of KPIs are useless. In particular, KPIs such as turnover or time to hire cannot be effectively utilized. I have discussed this in my articles. Basically, what we deal with is KPI overload. Here are my thoughts on how one could design better HR KPIs: http://www.bscdesigner.com/hr-kpi-excessive-measurement.htm
From India, Chennai
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From India, Chennai
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Hi, Sfkmujahid! Here is a long article with HR KPIs: KPIs for HR produce the excessive measurement problem that will give you an idea about what HR KPIs you should and should not use and why. Be ware of long lists of HR KPIs; they have nothing to do with actual performance management. They are just measures that are not aligned with any expected result.
From Spain, Rubí
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From Spain, Rubí
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I agree with SANGEETHA_07 above; just presenting a list of KPIs is not a very effective way to answer this question. I would go further; even a list of KPIs with descriptions is not going to help. There is no substitute for doing the job properly. KPIs should be specific to the needs of the company, division, or department. In this case, applying a bunch of standard HR KPIs will not be effective. The work needs to be done to determine what the objectives of the HR department are, and only then describe how the success of the objectives will be measured through the use of KPIs. This process is fully described in the white paper "Developing Meaningful Key Performance Indicators", which can be found at www.intrafocus.com/key-performance-indicators.
From United Kingdom, Southampton
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From United Kingdom, Southampton
Acknowledge(0)Amend(0)CiteHR is an AI-augmented HR knowledge and collaboration platform, enabling HR professionals to solve real-world challenges, validate decisions, and stay ahead through collective intelligence and machine-enhanced guidance. Join Our Platform.
Balanced Scorecard.zip
Balanced Scorecard.pdf