Analytics has become a power player in companies across the U.S. No longer can a company get through the day without pulling up some type of statistic or information that’s based on current or previous analytics. When evaluating a department or a company you’re hiring for, analytics is there to prove the benefits.
Senior leaders are looking for information that proves the overall effectiveness of human resources departments. One of the hardest things to justify is a department that doesn’t necessarily make companies money. For the past decade, human resources departments have been trying to prove their worth and value to leaders in their organizations. If you’re struggling to provide this information to the leadership within your company, we’ve come up with a few analytics/reports that will indicate how well your department is performing. Your information might not be as black and white as the finance department’s, but human resources is just as important.
Quality of Hire: Quality of hire is important, because it shows how well the human resources department is doing at recruiting candidates that fit into the organization. The total cost of hiring an employee, according to GetHired.com, can be anywhere from $18,000 – $20,000. Considering that cost, it’s generally understood that you want to hire right the first time. Showing your senior leaders that you’re able to hire correctly will prove that you’re saving the company thousands of dollars.
Revenue per Employee: This formula is important when evaluating the cost of employees lost due to voluntary or involuntary turnover. This is important for leaders in an organization because it shows, in general terms, the average amount of revenue that is being brought in per employee in the organization. A low number could mean that you have too much staff, which is a key issue to deal with properly.
Monthly Turnover Rate: In a very competitive job environment, it’s imperative that company leaders understand the amount of turnover that happens on a monthly basis. Having a report that shows why each employee left will give really good insight into employee moral and company growth. If high quality employees are leaving month after month, there may be an underlying issue that can be addressed by senior leaders. Having this report will help them figure out the best course of action more quickly.
Even though human resources departments don’t technically make money for a company, they save companies millions a year by hiring correctly and efficiently, and preventing employment lawsuits, among the hundreds of other things this generally understaffed department does. These three simple reports and figures will give your senior leaders a pretty good idea on how your human resources department is performing, and how it supports their organization as a whole.