This goes out to all my management and HR fellows who make statements like these:
HR is about people and soft stuff. You cannot measure this kind of work.
In other departments, it is easy to set up KPIs - in HR it is impossible.
Well, I have been there as well. And I partially still agree. There are differences in how to capture and measure facts in HR. It is not the same as if you looked at Finance key performance indicators (KPIs). While there are departments with mainly clear black and white results, HR operates in what I would call the gray zone: highly individual cases, in which you should not use the same one-size-fits-all approach.
Maybe I would describe it like this: When looking at people and working with them, you often see the tip of the iceberg. A lot of stuff is hidden. Measuring complexity in personal relationships or proving how much work someone put into their team’s success, is not hard facts to be quickly collected.
Especially when operating with a holistic approach, you might see a huge mountain and not know how to reach the top. I sometimes still feel that way! But I have learned during the past years how to start the hike and how to get higher little by little, step by step. „Slice the elephant into pieces“, my supervisor would explain to me.
How?
Here is a 3-step approach to come to wonderful and meaningful KPIs:
Step 1 is about brainstorming on possible indicators.
Step 2 is about choosing the right intervals.
Step 3 is about communicating your KPIs.
To round it up, this approach should be repeated regularly to stay up to date and customer oriented.
Step 1
This includes reflecting on the HR work around it, visualizing KPIs that might work.
What are the topics you focus on most?
What does the organization struggle with?
What would you like to change or achieve?
Which indicators represent your organization or your work best?
Find a way to measure it and you will reach it much quicker.
It is moreover about experimenting.
Approach the topics and their measurability in a playful way. Sketch and try different approaches. Don’t overthink and collect your ideas whenever something comes to your mind. Be as creative as possible.
Then implement those KPIs that could help you.
If, after a month or a year, another indicator might suit better, don’t wait to go for a change. And if you come to the conclusion that a KPI does not help you at all, dare to admit it to yourself and get rid of it.
Step 2
You now choose the right intervals. Not all KPIs should be reported in the same rhythm.
The main intervals are:
Daily. For example, you can measure how many employees are present per day.
Weekly. You can show the number of open and closed positions per week, as well as your progress in recruitment.
Monthly. It might be interesting to share how many employees joined or left the company.
Quarterly. Follow up on high absenteeism and define measures for either individuals, teams, or supervisors.
Yearly. Communicate on the average age of the employees and add the average seniority.
Choose a couple of currently meaningful KPIs.
What are your current challenges?
What is the business’s priority? It is all about customer focus! You can have beautiful indicators which are unimportant to the business. However, if they help you and your team to improve the quality of your HR work or to work more efficiently, they can still be of interest, but need to be presented differently.
What do you and your customers want to achieve?
Where do you see the organization in the future and how can you guide them to increase their maturity?
Last but not least: Be careful how you measure and how you interpret!
Especially in data-oriented environments, your KPIs might have a big power and can be interpreted positively or negatively - depending on how you choose to present them.
Step 3
Go out and share your KPIs! Depending on your organization’s way of reporting and sharing, you should communicate your insights.
Why?
1. Raise awareness for challenges.
Involve stakeholders and get their commitment on improving the KPIs that matter to the organization.
Follow up and escalate if needed. If KPIs are used on a regular basis, there need to be consequences, if goals are not met. Otherwise they lose their power.
2. Help employees understand HR and the organization better.
The more people understand what is happening around them, the better they will be able to contribute to the organization’s success.
But keep it as simple as possible to make it understandable for all departments and hierarchies. If your production operator is able to explain what you are measuring, you have done a great job.
3. Get some credit for your hard work!
Go out and share what you are working on. Nobody will know what is going on in your HR bubble the way you know, so don’t miss the opportunity to present a part of your world. Especially when KPIs are brilliant or steadily improving.
To sum it up, it is indeed possible and even advisable to work with KPIs in people-related areas. There are several ways to find the right indicators and to use them in a meaningful way. Along the way, you can always modify and improve, but be careful how you share with the public, in order to avoid misinterpretation.
I‘d love to hear your experiences with indicators.
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