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Its people who drive results. 

Organizations have a greater impact when measuring people and Human Resources effectiveness. As a result, the demand for HR measures as it relates to the business is on the rise. With the increasing demand for information, there is also a lot of confusion around measuring Human Resources, culture, and engagement.  Without clarity, comes confusion and an ultimate misdirect of time, effort, and resources. 

Let’s dive into clarity. 

What is the difference between scorecards, dashboards, KPIs, metrics, and analytics? 

These terms are often used interchangeably.  But they do have subtle differences. Here is a short summary of each term. 

Measure TypeUnderstanding the Difference
ScorecardA scorecard is a display of information that compares your performance against your projects and goals. 
DashboardA dashboard is made of up multiple data reports that give you the ability to compare and contrast diverse datasets within one display. Multiple scorecards can be pulled into a dashboard.   
Key Performance Indicator (KPI)A KPI is a tactical measure that shows how effectively a company is achieving key business targets or objectives.  Must be well defined and quantifiable.   
MetricsMetrics are a tactical measure that records or tracks an aspect of a process or activity. Must be well-defined and quantifiable (i.e. time-to-fill, turnover). Metrics are past focused. 
AnalyticsAnalytics are used to answer specific business-related questions. They are used learn about something (i.e. how do we gain more customers; how do we recruit more talent). Analytics are future focused. 
GoalsThe objective you are trying to accomplish (i.e.: increase profits). You can also link goals with specific, measurable, attainable, relevant, and time-bound targets called SMART goals. 
TargetsThe specific benchmark you want to accomplish through KPIs (i.e.: EBITDA 12.98%)

How do I determine which HR measures to report? 

Start by understanding your organizational direction. Don’t be distracted with sources that tell you the top 5, 10 or 20 HR metrics you should be measuring. Without alignment with your overall organizational direction, just putting numbers to paper is a wasted effort. Especially since your C-Suite’s focus is elsewhere. Find out what their focus is then determine which measures to choose that are closely aligned. 

If the overall focus is to increase profits and decrease costs, then you may want to select measures such as revenue per FTE, labor costs as a percentage of revenue that will mostly likely get the attention of the C-Suite.  

If your focus is on increasing customer satisfaction, then HR may wish to measure a number of items that are connected to the employees’ ability to take care of customers. Such as staffing levels to service demand, customer skill gaps, time employees are distracted away from customers, leadership capability, and/or quality of hire. In fact, I would consider creating a dashboard of HR measures that can be connected to influencing organizational customer service satisfaction ratings. Begin systematically working on influencing those factors to see if customer satisfaction ratings go up.  Read more about how HR impacts customer service here.

Are you trying to justify the purchase of an HRIS system or a new HR program? Then you will want to measure a return on investment. You will want to answer the question in terms of quantifiable measures how will this new system or program benefit the organization, the bottom line, improve productivity, etc. Read more about how metrics can impact strategic growth and profitability here.

What’s next for HR measures?

It’s not what’s next, but what’s happening now. The sophistication in HR measures is our reality today. Forecasting labor supply and demand, forecasting skill gaps, predicting trends such as turnover, health and wellness needs, and the impact of people policy, structure, and market changes. Gut feelings are out. Sophisticated people analytics are in.   

What I see in the future is more integration between Human Resources measures with overall business measures. I see in the future that organizational balanced scorecards and dashboards won’t be considered complete, unless there are people related measures included. 

What are your most pressing questions about this topic?

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Tresha Moreland

Tresha Moreland is a 30-year organizational effectiveness and strategic workforce planning expert. She partners with business leaders to develop workplace strategies that achieve best-in-class results. She has held key organizational leadership roles in multiple industries such as manufacturing, distribution, retail, hospitality, and healthcare. Tresha is the founder and principal consultant of HR C-Suite, LLC (www.hrcsuite.com). HR C-Suite is a results-based HR strategy resource dedicated to connecting HR with business results. She has received a master’s degree in human resource management (MS) and a master’s degree in business administration (MBA). She has also earned a Senior Professional in Human Resources (SPHR), Six Sigma Black Belt Professional (SSBBP) Certification. She is also recognized as a Fellow with the American College Healthcare Executives with a FACHE designation.

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