Four Ways to Use HR Metrics?

Great book by Jac Fitz-enz: The New HR Analytics: Predicting the Economic Value of Your Company’s Human Capital Investments.

Jac Fitz-enz is considered the father of human capital strategic analysis, and he’s my hero when it comes to the new way of HR analytics.

In his writings and interviews, Jac Fitz-enz says that HR analytics have progressed from

  1. transactional recording (HR activity reports such as hire numbers and employee pay) to
  2. human resource management (monitoring performance)  to
  3. business metrics (tying HR metrics to the business)  to 
  4. predictive analytics (foretelling effects: relating what we know to what’s ahead or what we don’t know)

Simply put, you might say that with predictive analytics we are trading in our old workforce planning methods for capability planning.

And as Jac Fitz-enz said in a Blog Business World interview recently, “I don’t see any way at all that HR can function effectively tomorrow without predictive analytics.”

Of course you have to have the right metrics if you want to go beyond transaction recording and enter the realm of predictive management.

I’m not talking here about the metrics that have been around forever: cost per hire, absenteeism, benefit cost per employee, turnover rate… those you would place under transactional recording, human resource management and business metrics in my list above. Though useful they have no predictive or strategic planning value for your human resources department. They report on current or past HR activities, but provide no guidance for improving your HR effectiveness.

Rather I am talking about “forward-looking” analytics, metrics that you can use to alter your HR strategy to make better decisions down the road. The kind of quantitative language financial and marketing people in business have used for years.

Here are four ways you can use “forward-looking” analytics to improve your human resources efforts and your organization:

#1 To keep good talent in your critical roles
You can use retention rate to determine where you have trouble keeping people in key positions. Determine why and then form an action plan to keep good talent in these key roles.

#2 To improve your retention rate
Employees who dislike the direction a company takes often leave. Therefore, each time you implement a major change, survey how employees feel about it. You may discover why you have a high turnover rate.

#3 To keep your employees engaged
Measure employee engagement — a survey might work well for this — and use the results to create a scale and goals for employee engagement. Then, when employee engagement falls off target, examine your survey questions to discover why. Implement a solution.

#4 To ensure that job candidates have advancement opportunities
To see how attractive your organization is to ambitious candidates, use career progression metrics such as average length of time before promotion, average salary raise per promotion and number of job titles before an employee reaches management level. If they reveal a problem – say that promotions rarely happen — figure out why and then implement a solution.

Here’s the bottom line. Lots of HR professionals waste time on metrics of little value. They’re missing the boat.

If you use metrics like those above, you could enter the realm of predictive management and make decisions that positively affect your organization’s bottom line.

Your Solution Toolbox: A Tool for Candidate Screening and More

Measuring What Matters
In my article above, I gave an example of using metrics to examine employees’ backgrounds to learn what affects retention for a given position and what background to consider when hiring for that position in the future.

Now here’s a tool from Profiles International that you can use to gather metrics for this purpose. We generally use it as an early screening tool in the candidate selection process.

Called Step One SurveyII® this pre-employment assessment measures an individual’s basic work-related values: background, employment history, integrity, personal reliability and work ethic. Can you see how you can gather results from the survey to use for HR analytics?

If you would like more information about Step One SurveyII® and how It will help you reduce hiring risk in a quick and cost-effective manner call me today at 952-322-3330 or send an email to

HR Consulting

Call me, too, if you are looking for professional assistance with your personnel questions. We'll help you learn how to: 

Let’s Talk! We offer a no obligation consultation to informally assess your current policies, procedures, and practices. This may help determine what’s missing in your current programs to meet the above recommendations.  Call 952-322-3330 or send an email to

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