2017-01-09

The five most important things to measure in HR by Drake International

Drake Editorial Team

Companies are looking to talent analytics for improving decision making around recruitment, retention, and succession planning, and Human Resources is stepping into the spotlight with HR Analytics.

The growth of analytics within HR is growing exponentially. Dr. Jac Fitz-enz is acknowledged as the father of human capital strategic analysis and measurement. He published the first human resources metrics in 1978 and benchmarks in 1985. Recently, he was cited as one of the top five “HR Management Gurus” by HR World, and by SHRM as one of the 50 persons who has “significantly changed what HR does and how it does it.” In a presentation to senior executives, Dr. Fitz-enz shared his thoughts on what he considers to be the five most important things to measure in HR, as follows:

  1. The single most important thing to measure is the mission critical turnover; who is leaving; what is it costing me for these most talented and most critical job people to leave?
  2. The total cost of labour as a percent in terms of revenue. What is it costing me to generate the revenue I am generating in terms of human costs?
  3. The amount of money spent on learning and development because if we are not pushing them continuously and developing our people, then we will have problems in the future.
  4. Engagement and how engagement is tied to productivity or other performance indicators. Engagement and its effects on the organization which is very important.
  5. The view of leadership by our employees. How do they see our leadership? Do they respect our leaders? Do they like our leaders? The reason this is so important is that if the workforce doesn’t respect and like working with the leaders, then whenever things go bad, people will drop out psychologically or physically leave the organization.


Josh Bersin, Principal, and Founder, Bersin by Deloitte stated that “People Analytics is even more important than we thought. Our research (Deloitte Human Capital Trends 2015) shows that 87% of business leaders are highly concerned about retention and engagement, 86% about leadership, and more than 85% about current workforce skills. Companies desperately need data to figure out what makes people join, what makes people stay, who is likely to be most successful, and what we can do to build more leadership, customer service, and innovation in the team. All these problems can be directly informed by great People Analytics. If you can collect a lot of data about the workforce and look at it holistically, you can predict who the right people to hire are, and who are most likely to be successful as leaders."

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