HR KPIs scrutinize how well-organised your teams are, and how efficient they are in achieving their objectives. They are useful in setting clear and unambiguous goals, evaluating those goals, measuring performance and tracking progress.

KPIs have long been used in marketing and sales to set goals and measure progress. However, at the moment HR departments are using these indices in their day-to-day work. HR KPIs can help businesses leverage existing data, extract valuable insights, and create a plan for the future.

In this article, we are going to be talking about five key indicators that HR managers should take advantage of.

What Is KPI In HR?
Key performance indicators (KPIs) are defined as quantifiable or qualitative, specific measures of an organization's performance in critical areas of its business. KPIs may vary by project, department or business; be weighted differently by each project, department or business; and be financial, non-financial or both.

From an HR standpoint, KPIs are HR-related metrics that have been analyzed to show a link to the organization's long-term business goals or critical success factors. For example, a decrease in time-to-fill for sales positions not only helps relieve scheduling issues but also increases revenue for the organization due to appropriate staffing levels.

Another HR KPI example might be whether turnover rates can be decreased within an organization. Decreased turnover leads to decreased costs (e.g., training costs, cost-per-hire) to an organization's bottom line.

Now that you understand what KPIs are, what are the top 5 key performance indicators you should take note of as an HR professionals?


Employee Productivity
Employee productivity can be defined as the amount of work (or output) produced by an employee in a specific period of time. As an employer, it’s important to understand how long it takes your employees to complete specific tasks, and if there are any roadblocks or distractions along the way that you could help them overcome.

Essentially, it analyzes how much work employees are taking on and how well they perform these tasks.

To understand employee productivity, your HR should consider all the factors impacting employees’ productive output. This includes the time employees spend working, their performance or the quantity of product produced, and the quality of the product delivered.


Employee Satisfaction
This is a very important HR KPI you should not neglect, especially due to the stiff competition for talent. If you want to retain your talent, you need to make sure your employees are motivated, satisfied and fulfilled. Many companies forget to track this important KPI.

It can be easy to believe that just because employees aren’t complaining, they are satisfied. Oftentimes, the only time an HR professional or company realizes an employee isn’t happy is when they hand in their notice.

A good way to track this KPI is to create measurable employee satisfaction surveys. Put together questions that can be easily tracked. This will enable you to analyze the data from the answers and get the insight you need to improve.


Turnover
Employee turnover refers to the number of employees leaving your organization. It includes retirements, voluntary employee terminations, and involuntary employee terminations. Each of these types of turnover gives you different, but equally important, insights into your workforce and company situation.

For example, a high number of employees voluntarily leaving your company might indicate that you have cultural problems or that your compensation package isn’t up to par. It can serve as a prompt to explore the specifics of what is motivating employees to leave your company.


Talent Retention
Retention of talent is a KPI that indicates the job stability of your company. Reviewing your company's average employee retention rate may provide insight into other factors such as the remuneration rate or the labour climate. By all means, employers want to keep the turnover rate low. When talent leaves, HR spends valuable time and resources recruiting to fill the vacant position.

Furthermore, the lost productivity from a position that is left open can have serious effects on your business’s bottom line. High staff turnover implies high costs for the employer. It’s much more costly to hire new employees than it is to retain existing talent. You also don’t want your top talent to walk out the door with all of their knowledge and experience and end up working at one of your competitors.

All in all, your HR should investigate how salary, time off policies, or office climate impact retention.


Absenteeism
This measures the absence rate of employees due to delays, sick leave, or excused or unexcused absences. This indicator can help plan for future absences or adjust your business strategy to prevent them.

HR managers can calculate this critical performance indicator by calculating the average value of the hours worked. This will show the impact of absenteeism on the company’s costs.

Once the cost of absenteeism is apparent, it will be easier to create a budget for a preventative strategy.

In conclusion, with quality metrics, you can make better decisions on how to optimise resources and create a more productive workplace, while also improving employee satisfaction. Get better data for quick, smart decisions that actually boost profits on www.hydrogenhr.com

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