Every business must be able to operate in an efficient way that maximises productivity and minimises cost and waste. This means tracking the efficiency of individual departments, including Human Resources.
In the past, corporate services departments such as HR were simply viewed as overheads, whose costs were apportioned to the individual business units as a central service. But today, it is far easier to evidence the productivity and outputs of HR functions, including recruitment and payroll. Let’s take a closer look at HR efficiency and see ways that it can be tracked:
What is HR efficiency?
HR efficiency is the number and volume of resources that are used to deliver the business HR service. Examples of these resources are the acceptance rate of offered roles, the turnover of new hires, the overall cost to hire and the time to hire, for each advertised role.
Why measure HR efficiency?
When you invest in HR efficiency measures, it is far easier to meet the needs and targets of your business and to evidence that you are doing so. Often these kinds of hard measures make it far easier for HR directors to secure further funding in their unit, or investment in key areas such as enabling software.
How can we improve HR efficiency?
To improve the efficiency of your HR function, it is essential that your teams are aware of what they must do to succeed in their role. HR efficiency metrics help to pinpoint areas for development and training.
There are different ways to track the effectiveness of the function over time. One good way is through benchmarking, either competitively or internally to measure progress over time. This can provide the foundation of measurement upon which you can create an action plan to further deliver and achieve success.
If you compare progress over time, you can see where your efforts are paying off. HR efficiency measures provide the baseline measures that are important for tracking. Poor HR efficiency suggests that there is an insufficient degree of people investment across the business and, again, the right metrics can help with the case for investment.
Get in touch
To find out more about HR efficiency metrics and the ways in which they can support your business success, please contact our team. We can provide HR advice, consultancy and outsourced payroll services in the UK to meet the needs of all modern businesses, setting you up for future success by leveraging the most important feature your business has; its talent.