Ultimate Performance: Measuring Human Resources at Work

Chapter 3. Supporting Human Capital Decision Making

If you are reading this book, then you are likely aware that the use of metrics in human capital management has been receiving a good deal of attention recently in a variety of forums. Many in Human Resources are ready to jump on the metrics bandwagon and are looking for specific directions on how to begin. Getting started with any new initiative can be a daunting task. The development of a metrics approach is seen as finding the best human capital related metrics (the what to measure) and deciding which measurement and analysis techniques to use (the how), as well as the methodology for interpretation (what does it mean), followed by making recommendations for appropriate action (what to do about it). With such a broad cut, the goal of developing an all encompassing metrics plan is the kind of project that can easily be measured in person years.

We have left out the most important dimension in terms of defining a metrics strategy: the why. Metrics should not be gathered, analyzed, and reported on for the sake of doing so. There needs to be an underlying motivation. Looking across the various disciplines that define most of the functional areas in modern business organizations, the underlying motivation for gathering data, analyzing, reporting on trends, and making recommendations, relates to decision support. Frequently the individuals or department responsible for providing decision support are not the same individuals making ...