| Familiarity with the concept of HR KPI will help | | | | this purpose, these indicators also help the HR |
| management and human resource department heads | | | | department identify which areas an employee excels |
| measure their performance in line with organizational | | | | and which areas he needs to improve at. Likewise, |
| goals. Moreover, these factors help them identify | | | | these indicators can be used to determine employee |
| strengths and weaknesses of the organization's | | | | disposition as with regards to their jobs. By determining |
| human assets. | | | | this, the HR department could institute activities that will |
| HR KPI is actually an acronym for the words, human | | | | help eliminate stress in the work place. Some of the |
| resource key performance indicators. Human resource | | | | most common HR KPIs are revenue per employee, |
| refers to the people who are hired to perform certain | | | | training cost per employee, acceptance rate, average |
| functions for the company. Key performance | | | | cost per hire, absence rate, turnover rate, human |
| indicators, on the other hand, are metrics or measures | | | | investment ration, resignation rate and average |
| that are used to quantify organizational objectives that | | | | remuneration. |
| are in line with the organization's strategic performance. | | | | Some companies opt to implement an HR balanced |
| These figures are mostly used by management to | | | | scorecard in their organizations. This measurement tool |
| evaluate the current state of a company vis a vis its | | | | considers several perspectives in measuring the |
| organizational goals. These are also often referenced | | | | productivity of the labor force. The perspectives |
| to when deciding what course of action to take. In | | | | considered in this scorecard are strategic, operational, |
| essence, HR KPIs will determine how the human | | | | financial and customer. The strategic perspective |
| resource of an organization contributes to the | | | | measures the ability of the organization to change |
| organization's overall performance. The identification of | | | | organizational culture and structure in line with the |
| relevant HR KPIs is very important as these will most | | | | implementation of certain business strategies. The |
| likely influence how an organization performs. | | | | operational perspective, on the other hand, focuses on |
| Moreover, these may vary year to year depending on | | | | the effectiveness and efficiency of HR activities such |
| corporate strategies implemented, corporate | | | | as turnover rate and attrition rate. The financial |
| objectives and strategic planning. | | | | perspective, meanwhile, measures the worth of human |
| It is an accepted truth that the workforce of a | | | | assets and the expenses that companies need to |
| company is its most important asset. The productivity | | | | shoulder in keeping them. Lastly, customer perspective |
| of each employee therefore, contributes to the overall | | | | looks at how effective the human resource |
| performance of a company. Employee productivity is | | | | department is from the viewpoint of internal customers |
| usually measured by HR departments by quantifying | | | | which are the employees. |
| the value of each employee. Such criteria as initiative, | | | | HR KPI may differ from organization to organization |
| teamwork, cooperation, quality of work and problem | | | | due to their inherent qualities like nature of operations |
| solving skills are also used to for this purpose. Identified | | | | and objectives. Nevertheless, HR managers could |
| HR KPIs may be disseminated to motivate employees | | | | learn from each on how to improve the overall |
| to perform better and to develop necessary skills that | | | | productivity of their departments and the employees |
| would make them better at what they do. Aside from | | | | as well. |