Ever thought how the talent in your organisation compares with the best in class? It’s probably something you’ve thought of often but didn’t know how to start?
Its definitely clichéd, but this statement by Peter Drucker rings true now more than ever before – “What you don’t measure, you don’t manage”. With vast and varied data available at their fingertips, leaders now prefer to make more data driven decisions in all aspects of business. The tracking and measuring of data related to talent in the organisation thus gains significant importance. Here are some metrics that give a good understanding of the effectiveness of the processes and systems of your organisation.
Quality of Hire:Organisations and business leaders spend a lot of time and resources on recruiting the right employees for the organisation. And considering people are the most important assets of an organisation, it’s imperative that the quality of hires will be an important metric for the organisation to analyse. While there is no single measure to evaluate the quality of new hires, a combination of performance ratings and retention rates can be used.
New hire performance rating: Keeping a track of the performance ratings of new hires will help determine whether the recruitment and selection has been according to the requirement. However it’s essential to keep in mind that new hires at times take approximately six months or more to actually start contributing to the role they are recruited for. Hence the organisation will have to have a specific policy regarding the stage at which the metric should be measured.
New hire retention rate:A good measure of determining whether the hiring strategy is successful is the new hire retention rate during the initial two years. At times organisations do not consider attrition during the initial 3-6 months as attrition in their record. This is because that short period is not considered enough time for the organisational factors to have made an impact on the new hire. An organisation thus using these measures needs to have a pre-determined policy regarding the timelines and the formula to be used for these metrics.
Employee Performance:Performance management data in the organisation throws up a lot of interesting information that can aid the talent management in the organisation. Firstly the performance management system should be robust enough to clearly distinguish between the performers and non-performers.
Apart from this managers need to know how to deal with non performers and the resources available to do so. This metric also helps compare the performance of various functions in the organisation and the success of managers handling these functions.
For example: A department or function with more high performers could probably have more clear systems and internal processes compared to the other functions. Or perhaps the manager has better skills and manages and motivates the team well. The organisation however needs to take steps to ensure there is calibration of supervisor ratings to make the metrics more relevant and serious enough to call for action based on it.
Retention Rates: Retention rates help the organisation determine talent management areas in the organisation that are doing well and those that need more attention. For example: While measuring the attrition rates the % of regrettable and non regrettable attrition can help determine success of the hiring and staffing policies.
The % of attrition of high performers will provide more insights on the engagement policy in the organisation and point the organisation towards steps needed to steer the managers in the direction of higher engagement.
Goal Alignment: Goals achieved can help determine the robustness of the performance management system that includes cascading of organisational goals and clarity of goals for the employees. Some of the goal attainment metrics that can be measured are % of goals obtained, % of goals exceeded, % of bonuses paid on the attainment of a goal or % of sales target attained or exceeded.
These are some of the metrics your organisation can measure in order to determine the success of its talent management strategy. However it’s critical to note that before using any measure to make important decisions, it’s essential to take steps to measure the accuracy of the data and have pre-defined policies regarding the collection of data and calculation of metrics being used to measure.
Head of Training and Development