HR has long had a ‘touchy feely’ reputation but this is fast changing and in my view will continue to do so. At the big end of town, bit by bit the data is changing or improving the decisions made around what is often one of the most expensive costs to a business – your people.
I believe that SMEs need to watch, learn and take best practice from the corporate world, but use it if, and only if, it works for your business. That said, I believe that you can learn from their mistakes but also apply it in a way that makes sense for you.
For example – what is the current employee turnover of your business as a percentage of your total headcount? As a guide, a healthy turnover is about 10-20%, depending on your industry. Why does this matter? – because it is damn expensive and time-consuming to replace people, but it also means you are not focused on what you should be! Not only that, there will be a dip in productivity as a result.
How would tracking the trends help? Well, for a start you might see the following:
- cost management opportunities
- identification of roles that are particularly difficult to retain and so develop strategies to address this
- identify management issuesdetermine whether you are struggling to identify what you really need
- improve your company’s attractiveness to the market- why would someone want to work for you?
- workforce mix – permanent full / part time, temps, casuals & independent contractors
- annual leave liability vs. scheduled annual leave
- managed attrition vs. unmanaged attrition
- absenteeism trends / issues
There are a number of beneficial pieces of data that are worth capturing as this will enhance your decision making ability – some other metrics you might want to consider are:
All the above are costs to your business but also they are levers that you can pull to reduce costs.
What metrics are you measuring and how has this impacted your business?