HR management is becoming more integral to organizational success as employee-centric programs grow increasingly important in fostering productive businesses. However, while most management teams appreciate the value of human resources, they are often unsure how to assess HR program performance.
Furthermore, they may not have a plan for interpreting those assessments to modify strategies and enhance performance. As such, organizations might compile a list of considerations for evaluating HR service delivery to measure its effectiveness more accurately.
Why Should You Measure the Effectiveness of HR Programs?
Organizations should measure the effectiveness of their HR initiatives to quantify (to the best of their ability) the program’s added value and whether continuing the program is worth the workforce investment.
However, measuring HR performance entails more than justifying the financial commitment. Successful programs include a human component and promoting a happier, healthier work environment in which team members are more productive. Management should strive for a healthy balance between managing resource investments and maintaining a positive workplace.
Evaluating HR Service Delivery: Six Considerations
Human resource departments develop various initiatives to benefit businesses and employees, ranging from wellness programs that promote better health to training seminars that improve team skills.
Measuring the success of these programs should be a thoughtful process, accounting for both quantitative and qualitative factors that impact employee and overall company-wide performance.
Those considerations might include the following six:
1. Output
Organizations should determine whether HR implements effective policies and practices to boost employee development, retention, and output.
These evaluations might include the ratio of recruits to promotions and subsequently to retained employees to gauge the effectiveness of progression programs. Organizations might also track the percentage of employees in development programs to assess training and learning the impact on work performance the goals have.
2. Efficiency
Businesses should also assess how efficiently their HR department establishes policies to engage and manage the workforce. These evaluations might include HR’s consistency, service quality, efficacy, and financial investment.
To determine the program’s relative value, management might consider analyzing the number of issues HR employees resolve daily and measuring key performance indicators (KPIs) such as the HR expenses-to-total-operations-cost ratio.
3. Team Management
Management might consider evaluating their success in promoting positive staff morale, team member engagement and contributions, and overall departmental production.
These metrics could include the rate of employee absenteeism and the success of implementing individual development plans, reviews, and constructive feedback.
4. Human Capital
The quality levels of a company’s human capital – including employees’ skills, expertise, and experience – can help gauge the likelihood of meeting business goals. Organizations can quantify human capital by comparing the number of employees with specific skill sets and expertise to the revenue they directly or indirectly generate through direct sales, cross-selling, innovation, or other means.
5. Strategic Impact
It may also be critical to track how efficiently the organization operates due to staff production. These valuations often correlate highly with strategic impact, which businesses can measure via changes in the two discrete relationships: employee commitment and customer satisfaction and the number of team members with skills and revenue generated.
6. Company Culture
HR’s primary role is to foster a positive business culture. As a result, employees feel a greater sense of camaraderie and self-worth when working in a positive and uplifting work environment.
However, work culture is difficult to evaluate because many factors and data points are subjective and qualitative. For example, measuring culture might include typical values like diversity, transparency, equality, and free-thinking. Other quasi-numeric metrics include successful communications, appropriate recruiting processes, and employee experiences.
Being able to assess factors that are not concrete or numerical can cost you time and money. However, assessing HR effectiveness as it relates to your operation is an integral part of a company’s overall strategic development and is worth the investment.
Cask and ServiceNow Can Help Boost Your HR Performance
HR programs are company-specific and as such organizations should identify their employees’ needs to design effective and successful initiatives.
Measuring the effectiveness of these programs begins with analyzing metrics and program results, whether they be quantifiable or otherwise. These analyses can help ensure that businesses allocate financial and other workforce-related investments to the appropriate HR programs.
Putting resources in the right places increases the likelihood that employees benefit from the programs, which helps companies grow.
Request a quote today and learn how Cask and ServiceNow can help you maximize your HR capabilities to create a positive work culture, boost employee satisfaction and productivity, and drive results.
