KPI for HR: How, When and Where?

Key Performance Indicators (KPI) also known as KSIs which stand for Key Success Indicators are not specifically linked only to HRD, but has to do with the entire organization. Since HR is the heart of any organization usually HR is assists other department also to set and identified their KPIs, which are measurable and quantifiable in nature so as 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.

For example, 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. For HR Department other KPIs can be following: Recruitment KPI, Training KPI, Health and Safety KPI, Performance KPI, HR Efficiency KPI, Working Time KPI, Compensation KPI, Labor Relation KPI, Employee Satisfaction KPI, Employee Loyalty KPI, HR Budget and Accounting KPI etc.

Sample Explanation:

Frequently used HR KPIs 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 organization’s strategic planning, corporate strategies and objectives which in turn affect HR’s strategic planning, HRM strategies and objectives. Bellow, I am providing only one KPI’s in details here. If anyone needs the details of other metrics, please do email me.

Training KPIs include key performance indicators as follows:

1. Training courses

• Number of courses offered

• Number of courses implemented.

2. Training costing

• Organization training expenditure (% of salaries and wages)

3. Training certificates

• Number of employees completing sponsored education programs

4. Training hours

• Average number of training hours per employee

5. Training budget

• % of HR budget spent on training

• Average training costs per employee

6. Training satisfaction

• Employee satisfaction with training.

7. Training results

• % of employees gone through training

• Average time to competence. That is average time it takes until expected competence level is reached.

• % & employee reach competence after training.

8. Training penetration rate

It measures the percentage of employees completing a course compared to total number of employees employed.

9. E-learning training

• e-learning courses utilized

• % of e-learning pass rate

And indeed e-HRM is the key tool to measure all the metrics successfully with 0% error.

© Shaki, Ahmed R (2012), Candidate of PhD in HRM, UUM

SAP HR in Bangladesh: Now or Never.....

What are the main modules of SAP HR? Is it really needed for better Human Capital Management? If you still don’t know what SAP HR is and whether it is needed for better HCM in your organization, I am sorry to say, you are far behind of modern HRM. Basically the solution for SAP HR included the entire process of workforce process management with sub module employee administration, individual time management and evaluation, organizational management, benefits management and payroll calculation.

SAP HR is effective tool for talent management. In talent management the sub modules are recruiting, career management, succession management, enterprise learning, compensation and benefits management and ofcourse the performance management.

SAP HR Sub Modules

Organizational Management

Personnel Administration

Recruitment

Payroll

Benefits

Compensation Management

Personnel Cost Planning

Time Management

Cost to Company (CTC) and Budget Management

Personnel Development

Training Management

Travel Management

Occupational Health and Safety

The beauty of integrating ICT in HRM is simple enormous and can bring the satisfaction and optimum output from the employees. HR Manager in Bangladesh, now its up to you. Love it or keep sitting in the backbench.

© Shaki, Ahmed R (2012), Candidate of PhD in HRM, UUM

Back to Basic!!!

In any organization, Human Resource Management (HRM) is one of the mostly needed departments now a day. Forget about Personnel Management. That is a Stone Age concept. The function of any organization which is responsible for recruitment, provide job descriptions, assess performance in tenure, doing need assessment for required training for further individual and organizational development, working strategically aligned with the management and offer direction to the human capital time to time is HRM. In the present age HRM is not only the task for HR department rather HRM can also be performed by line managers.

As Susan stated in about.com that HRM is the organizational function that deals with issues related to people such as compensation, hiring, performance management, organization development, safety, wellness, benefits, employee motivation, communication, administration, and training. I would like to add one more point and that is innovation. And that innovation must be tagged with Information System like e-HRM, HRIS.

Pic Source:www.adroitglobalnetwork.com.my/photo_53.gif

HRM manage people within and beyond the organization. HR personnel have to have the mentality that they are the spokesman of any organization so that they have to be more trained in customer services both internal and external. Managing people from a different race, culture, religion, beliefs and gender as well as disabled is one of the core issues of HRM. For sure, friendly and considered HRM can bring more success and keep the work place environment breathy. Effective HRM certainly accelerate the employees motivation level and that contribute significant input to any organization to achieve optimum productively and the accomplishment of the organization's goals and objectives.

If you or you’re the management of your organization still believe in traditional personnel, administration, and transactional roles, my write-ups are not for you. We are in the year of 2012 now e-HRM with bio-metrics, RFID, chips are widely using. HR start adding value strategically to the organization from the last decade and it’s a profit centre and measurable.

Last but very important basic in my view about HRM is: please do not choose your career in HR, if you do not love to mingle with people. HR is truly by the people, of the people and for the people. Chiao!

© Shaki, Ahmed R (2012), Candidate of PhD in HRM, UUM

Follow me in TWITTER :)

https://twitter.com/#!/ahmedshaki

e-HRM: Let the Journey Began to Bangladesh Now!

To run and manage the Human Capital within and beyond the organization successfully not only the HR manager but the line manager also required adequate information and Electronic human resource management (e-HRM) is the most advanced and sophisticated tools to provide so. e-HRM is far better option comparing to HRIS and its not only provides the core employee database or payroll system but the system facilities extended up to other systems like such as e-recruitment, e-learning, performance management and reward system. e-HRM is a technological invention which enables the transformation of HRM. It’s a replacement of solely, centralized HR function such as approving employees leave, pay raise, sorting out training etcetera.

e-HRM  is  a  way  of  implementing  HR strategies,    policies    and    practices    in organizations  through  a  conscious  and directed support of and with the full use of web-technology based channels. The benefits of using e-HRM are enormous. Not only the large organization even the SME’s can also adopt the e-HRM and the end result definitely will be more positive.

With e-HRM system employees themselves can able to do so with the approval of their line manager if required. Thus it helps the HR personnel to make themselves more involved with the strategic issues for their organization. Implementation of e-HR generally seeks to minimize or eliminate intervention from HR personnel and give access the line managers and individuals to perform HR tasks directly with the self-service tools. As almost every organization in Bangladesh has the web access in present time, the desire from the management is the first things to start the e-HRM now.

e-HRM system can change the work performed by the HR Personnel by dramatically   improving   their   level of service,  allowing  more  time  for  work  of higher  value  and  reducing  their  costs. Though some says that by implementing e-HRM systems the management wants to cutting    HR    staff,    outsourcing    and imposing   new   technology but consequently it motivates HR and other staffs to make them more skilled, attain new and advanced knowledge to make them fit and up to date for the challenging working environment. Since the system is web-based, it enables the employees to get access to the system from remote or online and at any time. Organization in Bangladesh those have different branches, outlets, establishment etc in different location can get the huge benefits and it will bring more satisfaction to the employees who have to travel frequently to different locations. Though people prefer the branded vendors but in-house IT team can easily create the software and infrastructure for it, which is more cheap and easy to customize. It’s high time to adopt and implement e-HRM in our organization now and be the benchmark for others.

P.S: This Article also published in HR Focus, Newsletter of Bangladesh Society for Human Resources Management. 

© Shaki, 2012