METRICS FOR MEASURING HR
EFFECTIVENESS
Why measure HRAgenda
effectiveness
In HPCL Context
How does HR Add Value to Business
(alignment with business)
How is effectiveness of HR measured
AlignmentHR
of HR
with Business
Why measure
effectiveness
Strategy
What are our strategic
and business
objectives?
Distinctive Competence
To achieve our strategy, what are
the key things we need to do
exceptionally well in order to
achieve our competitive advantage.
Workforce Capability
What are the key capabilities that our
workforce needs to excel in order to
achieve our business strategy?
HPCL Model for alignment with business
Strategic partner
Change Agent
(Management of Strategic
Human Resources)
(Management of
Transformation
and change)
Administrative expert
Employee champion
(Management of
Organisation infrastructure)
(Management of
Employee contribution)
Day-to-day operational focus
The Dave Ulrich Model
People
Processes
Future/strategic focus
HR as Change Agent
Future/strategic focus
(Management of
Transformation
and change)
People Focus
Change Agent
Project ACE as a Change Initiative
Project ACE Achieving Continuous Excellence
( An Organizational Transformation Initiative)
A comprehensive exercise of co-creating a vision and
cascading it across all levels (based on principles of Learning
Organization propounded by Peter Senge)
Series of ACE (visioning) workshops conducted starting from
Top Management down to Regional levels.
Learning Organization workshops being conducted across all
the levels including staff (introduction to five disciplines and its
application)
Project ACE as a Change Initiative
Project ACE Achieving Continuous Excellence
( An Organizational Transformation Initiative)
Leadership Workshops
People involvement in Strategy
Involvement of front line officers witnessing the moment of
truth in the strategizing process.
Strategies formulated for Retail and LPG SBUs and HR with
the involvement of over 500 front line officers.
HR as Strategic Partner
Processes Focus
Future/strategic focus
Strategic partner
(Management of Strategic
Human Resources)
Balanced Scorecard as a Strategic Initiative
Strategic tool for translating vision into clearly
articulated strategy and cascading the same to
different SBUs and levels through scorecards.
Financial
Customer
Internal Processes
Learning and Growth
Improved Profitability
Satisfied Customer
CURRENT REALITY
Customer Centric Processes
Improved People Competencies
Competency
Mapping
and
Development as
Why
measure
HR
effectiveness
Strategic Initiative
A Strategic process to build people capabilities in
line with international benchmarks to meet future
business challenges.
Competency Frameworks developed in line with international
standards
Behavioral Competency Framework for all levels
Technical Competency Framework for all job families
Development Centers for assessing individuals against
competency profile for the position.
Trained and Certified Internal Assessors
Behavioral Competency Framework
GRADES AT HPCL
LEADERSHIP FRAME
I
Creating Customer Delight
Leading Change and Creativity
Building Collaborative Partnerships
Promoting Synergistic Teamwork
Demonstrating Business Savvy and Decisiveness
Driving Results and Excellence
Building Global and Strategic Perspective
F
E
D
INDIVIDUAL CONTRIBUTOR FRAME
C
Dynamic Customer Focus
3 Enduring Commitment
and Initiative
4
Active Learning and Agility
5
Drive for Excellence
Cooperative Teamwork
Competency Based Training
TRAINING NEED IDENTIFICATION
Individual
Development Plans
(competency gaps)
As spelt out by SBUs
in line with business
requirements
Behavioral
Technical
Concurrently address Behavioral and Technical Competencies
Junior Management
Weightage to
Middle Management
Behavioral and
Managing
Top Management
Technical Competencies
Leading
Six Sigma as a Strategic Initiative
A Strategic initiative to review the critical business
processes and initiate continual improvements to the
same basis scientific methodology.
Critical Business / Technical Processes identified for
improvements.
Six Sigma Projects were selected to address these critical
processes in Refineries / LPG Plants / Terminals.
General Electric Experts are mentors for all the projects to
monitor progress till completion.
Processes Focus
HR as Administrative Expert
Administrative expert
(Management of
Organisation infrastructure)
Day-to-day operational focus
HR as Administrative Experts - Initiatives
Leveraging Information Technology
Enterprise Resource Planning (ERP) leveraged for prompt
employee service.
Leveraging technology to provide access to employee
information through intranet.
Finger touch Kiosks at major locations to help nonmanagement employees access their personal information.
Leveraging IT for creating a Learning Organization
Experience Sharing enabled through intranet.
Knowledge database created on different portals on intranet.
HR as Employee Champion
(Management of
Employee contribution)
Day-to-day operational focus
People Focus
Employee champion
HR as Employee Champion - Initiatives
DGMs as Mentors to different regions
Role of facilitating effective performance reviews and
feedback.
Act as a management representative to communicate
management philosophy, priorities and initiatives to
employees at large.
Highlight issues of concern at regions to the
management.
360 Degree Multi-rater Feedback System
To provide officers with an all round feedback from
various individuals interacting with them , giving
insights into their managerial/leadership behavior
displayed at workplace
Project Darpan - Gauging Employee Engagement
Employee Survey to understand the dimensions of
employee engagement that drive business
outcomes
Annual Employee Survey across all locations
of the Corporation in partnership with The
Gallup Organization .
Measuring HR effectiveness
Investment in HR processes and initiatives need to
culminate into business results, and therefore the
need to measure HR effectiveness
Meets demands for external accountability
( CEO, Business Heads )
Establishes clear, significant mission and goals
Fosters strong sense of internal accountability
Metric A basic definition
A quantifiable measure (not the measurement itself)
made over time, which communicates vital
information about the quality of a process, activity,
or resource.
Can be subjective, relative or absolute
Characteristics of a good metric
What gets measured is
what gets done
Aligned with Business
Actionable and Predictive
Consistent
Simple, understandable, logical and repeatable
Unambiguously defined
Capable of tracked over time
Capable of comparison (external benchmarks)
MOST IMPORTANTLY It should drive
appropriate action
Selecting
the
RIGHT
METRIC
Why measure HR effectiveness
Selecting the right metric is the key to success
(A wrong metric can destroy value in medium term)
Common Mistakes in design and use of metric include:
Metrics for the sake of metrics (not aligned)
Too many metrics (no action)
Metrics not driving the intended action
No record of methodology
No benchmarks
Measuring
HR
effectiveness
at
HPCL
Why measure HR effectiveness
Balanced Scorecard Methodology
HR Scorecard linked to Corporate Scorecard
Developing
HR
Scorecard
The
process
Why measure HR effectiveness
Define Business Strategy (Corporate Scorecard)
Outline Companys Value Chain
(Activities companies undertake to create value to
Customers)
Identify strategically required organizational
outcomes
Identify required employee competencies and
Behaviors
contd..
Developing
HR
Scorecard
The
process
Why measure HR effectiveness
Identify strategically relevant HR Systems, policies
and initiatives.
Design HR Scorecard Measurement System
Periodically evaluate the measurement system
Periodically review the way HR matrices are
reviewed
THE HRD SCORECARD
HP HR
THE IR SCORECARD
HRD Financial Matrices (examples)
Scoreca
rd Key
F1
Strategic Objectives
Management value
add
Metrics
Value added per
management
employee
Description
Measures utilization efficiency of
employee resource
IR Financial Matrices (examples)
Scorecard
Key
Strategic Objectives
Metrics
Description
F1a
Reduce incidents of
and downtime due
to labour disputes
Incidents of labour
disputes
Measures number of labour disputes in
the period
F1b
Reduce incidents of
and downtime due
to labour disputes
Total man-days lost due
to labour disputes
Measures the total number of man-days
lost due to labour disputes
F2
Resolve IR related
legal cases
Number of IR related
legal cases resolved
Measures the total number of IR related
legal cases resolved during the period
F3
Optimize workmen
productivity
Non-management
employee productivity
index
Index measures the aggregate company
level non-management productivity as
weighted average of SBU level
productivity(throughput per nonmanagement employee)
F4
Optimize legal and
dispute settlement
cost
Overall legal and dispute
settlement cost
Measures the total cost incurred in
resolution of labour disputes through
settlement and legal cases
HRD Customer Matrices (examples)
Scorecard
Key
Strategic Objectives
Metrics
Description
C1
Competent
Management
employees
Management employee
competency levels
Measures overall improvement in
employees competency levels
C2a
Management
employee and Retired
employee delight
Management employee
satisfaction index
Employee satisfaction index measures
the satisfaction levels of management
employees
C2b
Management
employee and Retired
employee delight
Number of unresolved
complaints
Measures the number of unresolved
complaints from retired employees
C3
Reduce employee
attrition
% attrition among high
performers
Measures attrition rate among high
performers in the organization
C4
Inter-SBU
coordination
Number of exceptions
to SLAs
Measures the number of exceptions
agreed to and signed with other SBUs
and departments
C5
Acceptance and
ownership of new
initiatives
Delay in implementation
of new initiatives
Measures the implementation
effectiveness of new initiatives
IR Customer Matrices (examples)
Scorecard
Key
Strategic
Objectives
Metrics
Description
C1a
Satisfied and
flexible
workmen
Non-management
employee satisfaction
index
Metric measures the satisfaction levels of nonmanagement employees through annual survey
carried out by an external agency
C1b
Satisfied and
flexible
workmen
Instances of vacancy
filling by existing
manpower
Metric measures the number of nonmanagement vacancies that are filled up by redeploying existing manpower
C2
Constructive
employee
unions and
association
Net positive unions
Measures the net number of positive unions
(unions for which number of issues taken to
conciliation stage as percentage of
memberships is less than benchmark number)
C3
Inter SBU coordination
Number of exceptions
to SLAs
Measures the number of exceptions to SLAs
agreed and signed with SBUs and other
departments
C4
Enlightened
line managers
Pre and post training
evaluation
Measures the effectiveness of IR training progg.
through pre and post training progg. evaluation
of line managers
HRD Processes Matrices (examples)
Scorecard
Key
Strategic Objectives
Metrics
Description
P1
Organisation Design
Alignment
Delay in implementation
of changes to the
organization structure
beyond scheduled time
frame
Measures the delay in implementation
of changes to organization structure
that have been proposed to, and
accepted by Management
P2
Manpower Planning
Percentage shortfall or
excess manpower
Measures the efficiency of manpower
planning process by determining
deviation of actual number of
employees from required manpower
strength
P3
Job evaluation &
competency fit
Average competency gap
Measures the effectiveness of human
resource allocation by comparing the
competencies required for position
with competencies exhibited by
incumbents
P4
Talent attraction and
retention
Average CGPA of
applications received
during campus
recruitment
Measures the attractiveness of HPCL
to best talent
IR Processes Matrices (examples)
Scorecard
Key
Strategic
Objectives
Metrics
Description
P1a
Legal
Management
Percentage of
disputes at
conciliation stage
that go into judicial
process
Metric measures the effectiveness of preventive
legal management as percentage of cases that
got resolved prior at conciliation stage
P1b
Legal
Management
Number of
exceptions to legal
management
process
Measures the violations made to the internal
documented legal management process
P2
Statutory
compliance
management
Number of
exceptions to IR
related regulations
Measures the number of exceptions to IR related
statutory laws and norms
P3a
Proactive union
management
Measures the
number of strong
union leaders
converted from
negative to neutral
or positive bias
Measures the effectiveness of union
management as a number of strong union
leaders converted from negative bias to neutral
or positive bias (polarity to be defined by ED-IR
based on parameters like number of disputes
raised with third party, agitation and aggressive
behavior etc
HRD Learning & Growth Matrices (examples)
Scorecard
Key
Strategic Objectives
Metrics
Description
L1
Quality of HR talent
Competency score of HR
department
Measures overall score of HR
employees on identified competencies
L2
IT integration of HR
processes
Number of online HR
processes and
procedures
Measures the number of HR processes
and procedures that can be accesses by
employees online
L3
Knowledge
Management
Knowledge Management
system set-up
Milestone metric measures the setting
up of a Knowledge Management system
L4
Strategic thinking
HR strategic thinking
score
Measures average score of HR senior
management on strategic thinking
Value Creation Example - HRD
Financial
Management Value Add
Customer
Competent Management Employees
Internal/business process Competency Development Processes
Learning and growth
Quality of HR Talent
(to design appropriate competency development initiatives
Value Creation Example - IR
Reduce incidents of and downtime
due to labour disputes
Financial
Customer
Constructive employee unions and association
Internal/business process Proactive union management
Learning and growth
Strategic Thinking
(to anticipate implications of present actions and
take proactive steps)
Payoffs
of
measuring
HR
effectiveness
Why measure HR effectiveness
Show contributions of selected HR projects
Earn respect of senior management
Gain the confidence of clients
Improve support for human resources
Enhance HR processes
Identify processes for mid term corrections
Identify successful HR projects
Forecast HR project success
Finally
,
create
a
Value
System
for
HR
Why measure HR effectiveness
Values co-created and adopted by HP HR Team
Respect the individual
Honor your commitments
Work in Teams
Why measure HR effectiveness
If were not keeping
score, were just
practicing.
Vince Lombardi
20th century football coach
Thank You
