Big Data. HR Metrics. By this point, I’ve either got your attention or you’ve moved on see if Laurie Ruettimann has posted any new cat videos. Not to be too cynical on the question of HR analytics, but it seems there is a chasm between those who see the value and those whose eyes glaze over at the mention of the topic. Incredibly fascinating or deadly boring? You be the judge.
I’m a true believer. HR analytics can be a crystal ball of sorts. Revenue per employee ratios and speed to competence metrics for new hires can offer key insights into ongoing performance. Dialing in specific metrics that are tailor-made for your organization — such as a hospitality provider that measures the time from placing an order to getting a drink on the table — that stuff is gold, baby.
It also points to the key problem with HR metrics. Developing the right ones, the data that tells you something meaningful about your organization, is hard work. How do you sift through all the data and get to something relevant? Let me offer you a few HR metrics that I’d like to see. A few of these may be a little tongue-in-cheek. Something for the cat video peeps.
An Engagement Metric
- Time-to-Asshole Ratio (TAR): Here’s a little nod to Bob Sutton. How many months did it take from date of hire until a person on your team became unbearable to work with? Ideally, your team metric should be as close as possible to 1. Non-asshole status may be regained by three consecutive months of good behavior.
- The TAR formula = Number of months until achieving full asshole status / Total months worked
A Productivity Metric
- Revenue- Per-Smoker Ratio (RPS): Steve’s Theorem: Your smokers are the most productive people in your workforce. They smoke because of the stress of the work. Exhibit A: Sales guys. They’re all dirty smokers. You know who else smokes? Cops, nurses, and teachers. Good, hardworking, salt-of-the-earth people. In the interest of full disclosure, my perspective is colored by years of working in newspapers and advertising. A healthy (so-to-speak) ratio is a whole number. Just make sure it’s enough to cover higher healthcare costs. Steve’s Corollary: The least-productive people in your workforce are also smokers. You know who they are. Break out the performance reviews and get to work.
- The RPS Formula: Revenue Per Smoker / Revenue Per Non-Smoker
An Efficiency Metric
- Time-to-Slacker Ratio (TTS): With a nod to Peter Gibbons. After coming in late, taking a long lunch, Facebooking, eBaying, just plain spacing out, attending meetings, and leaving early, how many hours of real work are your people doing? How close to 1 can you get?
- The TTS Formula: Number of hours of productive work per day / 8
A Key HR Metric
- The Pastry Ratio (TPR): With a nod to Mr. Burns. Put down the éclair and get back to work. Pastries, cookie bouquets, birthday cakes — the road to financial ruin is frosted with sugary goodness. How do the cost of donuts and birthday cakes bite into a department’s total revenue? How does this correlate to overall earnings? If your result is not a whole number, how are you still in business?
- The TPR Formula: Total revenue / Cost of donuts, cakes, and all other pastries