Does HR have a desire to measure?
Traditional HR has been known to run away from measurement. Increasingly, CEOs are demanding accountability of results and are not interested in programs or activities. The question is can HR make this change?
Business productivity, efficiency, effectiveness has many talent related metrics – from hiring metrics like time-to-fill, cost-per-hire to management metrics like turnover by segments, percentage positions filled internally, employee engagement and so on. While HR is today measuring these to track past performance of their efforts, CEOs are today demanding commitment from their HR leaders on pre-defined targets that will eventually affect business performance.
HR tends to come back to business on how these are difficult to measure as they depend on varied factors outside of the purview of HR. That is true. But that is true for all other functions too. So, the fundamental question is ‘Does HR have the desire to measure?”
I remember listening to one of our roundtable discussions, where Prashant Tripathy, Chief Financial Officer of Max Life Insurance said HR brings the right brain to the management team, but sometimes they end up being at the extreme right hand corner of the right brain.
HR needs to become more and more measurable so that there is proof that it adds value to the bottom line. This is a one-way street. The clash is between the strategic focus on people management that CEOs have (from hiring the best talent to maximizing retention of critical segments), with archaic approach and practices that HR still holds (from risk avoidance, hunch-based people decision, lack of accountability on people metrics). It calls for a complete reinvention of HR as a function.
If there is a will, there is a way. Business demands that HR programs need to be aligned to business outcomes. That would require HR leaders to forecast and pre-empt issues and finally commit to outcomes by leveraging the power of data. What are you doing in your company to lead this transition? I would love to hear from you.