With HR KPI examples, you can measure whether you are achieving your goals.

Use the HR KPI examples below to make the success of HR and your organization visible.

In one of our other blogs, we already highlighted how important it is to work data-driven as an HR professional. This applies to every department and every organization, but certainly to HR. Not only because automation can make life so much easier. The right data also provides important input for your HR strategy, substantiates the added value of the HR department, and makes it clear which levers you can pull to improve business operations.

Of course, you can use whatever your various systems happen to produce. However, it is more useful to invest a little more time in deliberately formulating HR KPIs (Key Performance Indicators) and ensuring they are easy to extract from your systems. That investment will pay for itself many times over.

What makes these HR KPIs so interesting? First of all, these metrics serve as a good reference point; you can use the KPIs to gauge how you are doing in achieving your HR goals. Is everything going according to plan, or do you need to step it up to hit your targets?

Secondly, KPIs reflect the effectiveness and stability of your workforce. They tell you whether you have enough talent, knowledge, and skills in-house, or if the recruiter needs to work hard to get the workforce back in order, both qualitatively and quantitatively. And, perhaps even more importantly, how you can ensure that your valued employees stay with you.

There are all sorts of metrics you could use to shape your HR strategy. We are happy to share our favorite HR KPIs with you!

5 HR KPI examples for HR professionals

1. Return on investment (ROI) of HR

It might sound a bit business-like for a department that is usually warm, like HR, but it is very interesting to look at what the euros invested in HR have actually yielded. The ROI indicates the added value of your HR department, the quality of your HR team, and your strategic policy. What should you consider?

• What is the cost per hire? In other words: how much has been invested in recruiting, selecting, and onboarding new employees? You can interpret this broadly: from advertising costs to travel allowances, social media, and the internal hours spent on the process.
• How often have the recruitment costs actually resulted in the right match? And by that, we don't just mean luring a talented applicant into an interview. The right match is, above all, the employee who passes their probation with flying colors and remains productive in the organization for a long time.
• What have the offered training and education programs yielded? Do the costs outweigh the gains? Is there demonstrable evidence of better-qualified staff, and have there been more promotions, for example? Has a broader range of products or services emerged, or a stronger competitive position in the market?
• What has been invested in occupational health and safety provisions, interventions, and training? And has it actually led to lower absenteeism, fewer incidents, or more sustainable employability of employees?

2. How happy are your (former) employees?

Let's be honest: the employee is ultimately the customer of every HR department. Therefore, the results of an employee satisfaction survey should not be missing from your HR metrics. There are various indicators you could use:

• The employee Net Promoter Score (eNPS) - this reflects the enthusiasm of employees about the organization and the extent to which they recommend the company as an employer. This is an important indicator for the employee experience. The employee rates their employer on a scale of 0 to 10. The results fall into three categories: the promoter (score 9-10), the passive (score 7-8), and the detractor (score 0-6). The difference in percentages between promoters and detractors is the eNPS. By zooming in on the background of the given score, you can obtain important input for developing HR policy. In 2021, the average eNPS score was +12; top employers score between 50 and 70.
  
  
• Employee satisfaction - this measurement is quite common in most companies. It usually focuses on initiatives from the organization, such as salary and facilities offered, working conditions, and the functioning of the works council.
  
  
• Work happiness - this measures things that go beyond the facets of employee satisfaction. Think of purpose, pride, experienced appreciation, autonomy, growth, inclusion, collaboration with colleagues, and the relationship with the manager. Work happiness questions are based on active engagement and shared responsibility.
  
  
• Review scores - as an employer, you have little direct influence on this score because they are on external websites. Yet this category is quite important because it influences the influx of new employees. Many potential applicants first check how the prospective employer scores on review sites like Indeed or Glassdoor. The experiences of (former) employees are displayed there in detail. What about the company culture, work-life balance, and growth opportunities? As an HR department, keep an eye on these types of scores; it provides a nice insight into the world of your employees and thus tools for your personnel policy.

3. Absenteeism

Absenteeism has a huge impact on business results. If absenteeism is high, you notice it immediately in productivity and costs. High absenteeism means that work is left undone and processes get backed up. Moreover, high absenteeism significantly lowers the work atmosphere. Colleagues become overloaded and irritated, and work happiness and employee satisfaction go down. And that's not even mentioning the absent employee, who probably would have preferred to be at work as well.

So, keep a close eye on the absenteeism rate. Make sure you always check the following values:

• The standard absenteeism rate - the number of absent days divided by FTE multiplied by calendar days
• Absenteeism frequency - how often does someone call in sick in a year?
• Absenteeism duration - is it short, medium, or long-term absenteeism?
• Absenteeism costs per day

The absenteeism costs per day are often alarmingly high and are guaranteed to ring alarm bells for managers and the employees themselves.

Also, zoom in on the background of the absenteeism reports. In the context of privacy, an occupational health service cannot, of course, share personal medical information, but an anonymized report containing the reasons for absenteeism can be an eye-opener. Once you have identified the trends, do not hesitate to take (preventive) measures.

4. Turnover

Low turnover ensures organizational stability. You don't have to constantly recruit and train new people. Employees who leave voluntarily often take a wealth of knowledge and experience with them. That is why turnover is also an important KPI to monitor.

What is the average length of service for an employee in the organization? What is the reason for their departure? What is the average age of departing colleagues? This type of information can provide incredible input for your HR policy. For example, is there a reason to improve onboarding or adjust employment conditions? Should more attention be paid to training and internal career opportunities? Make the most of your offboarding. After receiving a resignation letter, send an exit survey to the departing employee, and supplement it with a personal interview if desired.

Involuntary departures also provide interesting information if you look beyond just the numbers. How did the process go and what was the background of the dismissal? Could the poor performance or conflict have been prevented, and if so, how?

5. Competencies and skills

Do you know exactly which competencies and skills are present in your organization? By making smart use of a Learning Management System, you can keep a close eye on the knowledge level within your organization. And if a vacancy arises, you will find it much easier to identify an internal candidate. When inventorying training needs, look beyond just internal factors: compare internal data with market trends and developments. That way, you stay one step ahead of the competition!

If you notice that knowledge is missing in specific areas, provide new modules in the system and promote them to employees in a positive way. An easy registration process is important and prevents people from dropping out before they have even started. And, of course, make the training sessions engaging and lighthearted.

Better ten bite-sized knowledge snacks than one long-winded module that you can't keep your attention on!

Need help measuring your HR goals?

When it comes to handling data smartly or sharing information in an accessible way, Pluvo is the right place for you. We are happy to help you map out the right KPIs and the actions to take. So feel free to contact us!