By Haresh Awatramani, CEO, Beehive
Businesses have faced a lot of uncertainty in the last 24 months, whether they were dealing with operational transformations, supply chain interruptions, or employment issues. Given this volatile business environment, it’s no wonder that company executives are desperately seeking some sense of predictability right now. They are consulting specialists, examining tea leaves, and, most crucially, delving into data. This is especially true when it comes to determining employee productivity.
The once-rapid, now-extensive shift to remote or hybrid work arrangements has left many businesses yearning for new and improved insights into their employees' productivity. Several businesses are using employee monitoring software, which collects and analyzes a large amount of data. The issue is that when this information is used incorrectly, it can lead to a misleading impression of employee productivity and organizational well-being. Here are three measures that executives should track in the future to gain better clarity of employee performance/productivity.
1. Engagement metrics: Employee engagement metrics are critical for HR to remain under the radar since they give insight into how connected, dedicated, and motivated employees feel. Employees that are emotionally invested in their teams and company provide more value to both their job and the organization. Here is a quick rundown of the key KPIs for employee engagement:
Employee resilience: Resilience is an important skill that allows people to manage and adapt to continually changing situations. Employees with high resilience ratings are more likely to stay with the organization for a long period, whereas employees with low resilience scores are more likely to quit shortly. Self-efficacy, social support, and confidence about the company’s future are indicators of employee resilience. Tracking polls and surveys may be used to collect various indicators for gauging resilience.
Absenteeism: This measure must also be monitored. Absenteeism refers to a pattern of unplanned and unauthorized absences from work. Employees may face force majeure situations due to personal or family concerns. However, the absence of a person establishes a pattern, which should be considered.
Employee turnover rate: Never underestimate the ETR (employee turnover rate). A high ETR suggests an issue. To maintain a healthy turnover rate, measure ETR on a monthly, quarterly, and yearly basis. A corporation does well if the proportion is between 10 and 30 depending on the business domain. Employee engagement rate: Employee Engagement assesses how committed employees are to the organization, how eager they are to advocate for the firm, and how resilient they are.
2. Outcomes metrics: While engagement metrics do provide crucial insights into the employees and their performance, it also offers an incomplete picture. It is fruitful to combine employee engagement metrics with outcome analysis to get a clearer picture. It helps to set clear, limited, specific key performance indicators (KPIs), and monitor progress toward these outcomes. The measuring outcome includes measuring cost per hire, which is the amount a company spends on hiring a new employee. This can then be compared with the employee’s performance from the engagement metric and companies can then have a clearer picture of whether their hiring and performance determine the value for money in the long run.
Outcome metrics also measure each employee’s time since the last promotion which helps an organization determine who deserves a promotion and how satisfied or dissatisfied employees are with their progress in the company. Outcome metrics also measure revenue
generated by employees, the ratio of HR professionals to employees, and performance and potential.
All of these measurements help determine which employees are actually adding value to the company, who should be rewarded or reprimanded, whose potential is not completely reached, and who has the ability to do more.
3. Well-being metrics: Healthy and flourishing teams lead to healthy and thriving businesses. An organisation’s health comprises various aspects like the well-being of each employee, the physical and mental strength of their bodies; the balance of their mental and physical state; and the emotional connection between employees and their employers. Through well-being metrics, organizations gain vital information about employees’ mental health, their interpersonal relationships, the nature of these relationships, and how their mental health is affecting their work and therefore productivity.
These measurements allow organisations to spot potentially negative trends regularly and act quickly when necessary. This metric provides insights into what employees think about their own organisation, and what is their feedback for the management. It also helps measure the number of sick leaves taken by employees which means that employees may be overworked, might be stressed, and overall dissatisfied with the organisation and their role.
Which HR metric to use will depend on the nature of the business and the challenges being faced by a particular organisation. However, it helps to have a buffet of different metrics to choose from depending upon the needs of an organisation.