At ER Expo 2003 West in March, I had the opportunity to meet many very interesting people. Our conversations ranged from discussions about applicant tracking systems and career’s sections on corporate websites to March Madness going on in the NCAA tournament. But the most interesting comment I heard at the show centered around metrics. Nick Burkholder of Staffing.org had just finished his presentation, “Staffing Metrics for Fame and Fortune.” An attendee approached me and said, “Of all the attendees at this conference, I think I’m the only one that is collecting data and generating management reports on staffing metrics. I’ve talked to a lot of people here, and most of them are HR generalists or work in Recruiting. But none of them are responsible for the data.” This comment stopped me cold. Could this be the real reason why people aren’t measuring their staffing performance? Because they don’t perceive it to be their job? Do they need the title of “staffing metrics manager,” as this attendee had, in order to begin measuring? A few years ago, I was working for what was the consulting services division of what was then Ernst & Young as a recruiting manager. Each week, we received nasty emails and calls from our recruiting operations manager asking us to be sure to update the milestones in our applicant tracking system so that he could generate reports for the management team. These messages were then followed by additional reminders to be sure to get the data in the system. Our national director of recruiting even went so far as to send his own messages underscoring how important this really was and how we needed to comply with the requests of the Recruiting Operations Manager. Each week, these requests fell on deaf ears. It was a never-ending cycle. Why? Because we didn’t know what the data was being used for, except affirmative action compliance, and no one held us accountable. As long as we were getting hires in the door, we were doing our jobs ó or so we thought. What both situations have in common is accountability, or lack there of. And what I would suggest is that most organizations have yet to hold anyone accountable for measuring. During his presentation at ER Expo, Nick told a story of how one senior-level HR manager was recently fired from an organization after repeatedly being told by the CEO that she needed to start measuring. There may have been additional reasons she was let go, but to be sure her non-compliance with the CEO’s request was a major factor in the decision. Judging by the reaction of other attendees at the ER Expo, this was definitely an exception. Most are not held to such standards of accountability. Taking Responsibility for Metrics CEOs, CFOs, and other executives are clearly delivering the message that metrics are important to organizations. Is it in our best interest to hold off doing anything about it until they put our jobs on the line? Instead, let’s all agree to take accountability and start measuring today ó no matter what our title. Not because we’re fearful for our jobs, but because by measuring we’ll improve both our own and our organization’s performance. What’s the best way to get started? I would suggest you do the following:
- Meet with your CFO or finance group and find out what is important to the organization. In the coal-mining industry, for example, the measure of tons of coal produced per man-hour shift is a very important metric, much more so than, say, turnover percentage. While I was working at Peabody Energy, I recall telling our hiring managers that they needed to be concerned that 20% of their employees would be retiring in the next few years. It fell on deaf ears. But when I rephrased my argument and told them how that would affect the tons of coal produced per man-hour shift, it got their attention.
- Identify how your organization would like to see your information. Believe it or not, how you present the information is as important as the information itself. The finance group should be able to help in this area too. John Vlastelica recently spoke on this topic at the national EMA conference. While at Amazon.com, every single one of his staffing reports looked like it came out of the finance group. Same fonts, same format, everything. And it got attention. It looked credible.
- Make sure the metrics you use are meaningful. We all know that cost per hire is something that most organizations look to as a standard. But is it really a metric that you can use to make valid comparisons? There are some major issues with cost per hire. I would suggest that you look into a metric called the staffing efficiency ratio. It’s a much better, more easily comparable metric. (See www.staffing.org/measure/costperhire.html for a complete discussion on CPH and staffing efficiency.)
- Start! Don’t worry about historic information. The most important information to gather is what you are doing today. Often organizations think that the first thing they should do is to gather historical data so they have something to benchmark against. Wrong. The first thing you should do is just start measuring. Once you’ve gathered your current information, then you can go back and look at the historical information to see how you did before.
- Benchmark your results against other organizations in your geography and industry. In order to tell the most compelling story with your metrics, you need to know how you fared compared to your key competitors and to others in your geography. For example, your staffing efficiency ratio may be high, and you might be a bit concerned. But when you compare that to others in your industry, you may find out that their efficiency ratio is even higher. Your efficiency ratio then doesn’t look so bad, and you have a different story to tell.
- Determine the best frequency for each metric. One of the questions I get asked frequently is, “How often should I report my metrics?” The answer is, it depends. For example, you may not be interested in reporting turnover every month if yours is an organization with historically low turnover. But you may be interested in looking at time-to-start each and every month, especially if you are using this metric to gauge recruiter effectiveness.
Now is a great time to start measuring and benchmarking. The Human Capital Metrics Consortium’s 2003 Standard Benchmark Surveys were just launched. There is no reason not to participate. It’s free, absolutely confidential, and you’ll receive a valuable analysis at no cost. Your performance will also improve. Visit survey.staffing.org to take this important survey today!
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Note: If you’re a recruitment or HR professional in the Washington D.C. area, don’t miss Heather Hartmann at the Washington D.C. Metrics Symposium, hosted by ERE, at the Doubletree Hotel in Crystal City on May 21. Click here to learn more.