HR Metrics and Model for Modern Times

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1 HR Metrics and Model for Modern Times Karen Shellenback, Research Manager Bersin by Deloitte, Deloitte Consulting LLP Jennifer Krider, Senior Research Analyst Bersin by Deloitte, Deloitte Consulting LLP December 16, 2014

2 Agenda: High Impact HR survey sample size: 298 HR practitioners (Director level or above, 100+ employees in the organization) HR Factbook survey sample size: 251 HR practitioners (Director level or above, employees in the organization) Sample from a wide variety of industries, geographies and organization sizes 1 HR Metrics and Model for Modern Times

3 Challenges for Modern HR HC TRENDS: 2,500 COMPANIES IN 90 COUNTRIES Spans of control are broader Talent programs - global in scale, yet locally Responsiveness & Coordination implemented 71% Leverage technology and analytics 74% Drive and improve collaboration and engagement 78% Propel the company s employment brand 75% Help business leaders respond to skills & leadership gaps 89% 2 HR Metrics and Model for Modern Times

4 What HR Professionals Think: 28% FEEL HIGHLY CONFIDENT THAT THEY ARE EFFICIENT 72% RATED THE NEED TO RESKILL, REORGANIZE, AND TRANSFORM HR AS A HIGH PRIORITY 22% FEEL CONFIDENT THAT THEY ARE ADAPTING TO EMPLOYEE NEEDS WELL 30% STRONGLY BELIEVE THEY HAVE A REPUTATION FOR SOUND BUSINESS DECISIONS 20% FEEL THAT THEY ARE ADEQUATELY PLANNING HR FOR THE COMPANY S FUTURE NEEDS 3 HR Metrics and Model for Modern Times

5 ATTRACT ENGAGE RETAIN EXCITE 4 HR Metrics and Model for Modern Times

6 5 HR Metrics and Model for Modern Times

7 Improving Managers People Skills: Organizations feel particularly weak at Aligning and setting expectations and goals 9% 21% Supporting employee engagement 6% 19% Attracting top talent 5% Responsiveness & Coordination 13% Identifying and developing leaders 5% 32% Managing performance problems 5% 32% Coaching and developing people 5% 33% Onboarding new staff 4% 32% Assessing and selecting the right candidates 3% 12% Excellent Poor or Below Avg 6 HR Metrics and Model for Modern Times

8 Can we design an HR function that is optimized to improve the people-related capabilities of our managers, above all else?

9 Business-Embedded Design & Delivery HR Specialist Expertise Use of External Intelligence The Architecture of High Impact HR Leverage Principles 1 through 4 to optimize business leadership, manager people skills, and HR performance to create strong organizational performance. Maximize HR s capability to align with the business and stay aligned by mirroring the business strategy despite external forces. 5 3 Business Leadership Organizational Performance Manager People Skills Responsiveness & Coordination Alignment & Resilience HR Performance 4 Ensure responsiveness by coordinating efforts across the organization, including frontline decision-making, information-sharing, and providing depth and breadth of programs. Start with a foundation inclusive of analytics; an empowerment culture with bold HR leadership; and belief in value-added HR. 1 Analytics Empowerment Culture with Bold HR Leadership Belief in Value-Added HR 2 Build a structure that optimizes businessembedded design and delivery; leverages HR specialist expertise, and uses external intelligence. 8 HR Metrics and Model for Modern Times

10 3.1X 4.3X 4.2X Organizational Performance Customer Satisfaction Responsiveness Time to Market Wins in Market Achieves Goals Efficient Operations Cost Control Business Leadership Manager People Skills HR Performance Capability Decision Making Communicating Vision Attract / Assess / Select Onboard Align / Goal Set / Coach Develop Meets Goals / Efficient Adapts Supports Change Decision Making = HR s Strongest Path to IMPACT 9 HR Metrics and Model for Modern Times

11 Achieving High Impact HR 10 HR Metrics and Model for Modern Times

12 What is Happening in HR Today? Modest Increases Seen in HR Spending $5,000 $4,000 $4,007 $3,000 $2,936 $2,674 $2,000 $1,973 $1,497 $1,000 $0 U.S Total Midsize (1,000-4,999) Medium (5,000-9,999) Large (10,000-24,999) Enterprise (25,000+) 11 HR Metrics and Model for Modern Times

13 What is Happening in HR Today? Modest Increases Seen in HR Staffing and Technology: 12 HR Metrics and Model for Modern Times

14 What is Happening in HR Today? Financial Service Companies Invest More in HR 13 HR Metrics and Model for Modern Times

15 What is Happening in HR Today? Overall Turnover Increases 14 HR Metrics and Model for Modern Times

16 Improving Managers People Skills: Organizations feel particularly weak at Aligning and setting expectations and goals 9% 21% Supporting employee engagement 6% 19% Attracting top talent 5% Responsiveness & Coordination 13% Identifying and developing leaders 5% 32% Managing performance problems 5% 32% Coaching and developing people 5% 33% Onboarding new staff 4% 32% Assessing and selecting the right candidates 3% 12% Excellent Poor or Below Avg 15 HR Metrics and Model for Modern Times

17 Business-Embedded Design & Delivery HR Specialist Expertise Use of External Intelligence The Architecture of High Impact HR 5 Organizational Performance Business Leadership Manager People Skills HR Performance Responsiveness & Coordination 4 Alignment & Resilience 1 Analytics Empowerment Culture with Bold HR Leadership Belief in Value-Added HR 16 HR Metrics and Model for Modern Times

18 Want to Know More? Deloitte Human Capital Trends Research html High-Impact HR: Building Organizational Performance from the Ground Up HR Factbook: Benchmarks and Trends in HR Spending, Staffing, and Resource Allocation HR Spending Metrics HR Spend per Employee Year- Over -Year Change in HR Spend Percent of HR Spend on HR Staff Payroll Percent of HR Spend on HR Technology HR Staffing Statistics HR Staff : Employee Ratio Breakdown of HR Staff by Level Year- Over -Year Change in HR Staffing Percent of HR Spend on External HR Services HR Effectiveness Measures HR Outsourcing Measures Promotion Rate Recruiting and Sourcing Voluntary Turnover Rate Benefits administration Involuntary Turnover Rate Payroll administration HR helpdesk Plus, many of the above metrics cut by HR organization maturity level. 17 HR Metrics and Model for Modern Times

19 Thank You! Karen Shellenback Research Manager Bersin by Deloitte Deloitte Consulting LLP Jennifer Krider Research Analyst Bersin by Deloitte Deloitte Consulting LLP

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21 This publication contains general information only and Deloitte is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This publication is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional advisor. Deloitte shall not be responsible for any loss sustained by any person who relies on this publication.