By analyzing KPIs, organizations can align their workforce capabilities with business objectives, ensuring they have the right number of employees with the appropriate skills at the correct times. This foresight minimizes the risks associated with understaffing or overstaffing, which can lead to increased costs or missed opportunities. Additionally, by using KPIs to measure the impact of training and development programs, HR can optimize employee growth and retention, contributing to a more robust and adaptable organization.
KPI |
Definition
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Business Insights [?]
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Measurement Approach
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Standard Formula
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Absenteeism Rate More Details |
The rate at which employees are absent from work, indicating overall employee health and engagement.
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Reveals trends in employee absenteeism and potential issues in work environment or employee engagement.
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Number of days absent in a period, total number of workdays available.
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(Total Number of Absent Days / (Number of Employees * Number of Workdays)) * 100
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- An increasing absenteeism rate may indicate declining employee engagement, health issues, or dissatisfaction with work conditions.
- A decreasing rate could signal improved workplace wellness initiatives, better work-life balance, or enhanced job satisfaction.
- Are there specific departments or teams with consistently high absenteeism rates?
- How does our absenteeism rate compare with industry benchmarks or seasonal variations?
- Implement flexible work arrangements and wellness programs to support employee well-being.
- Conduct regular employee engagement surveys to identify and address potential causes of absenteeism.
- Provide training for managers to better support and manage employee workloads and stress levels.
Visualization Suggestions [?]
- Line charts showing absenteeism rates over time by department or location.
- Pie charts illustrating the distribution of absences by reason (e.g., illness, personal time, burnout).
- High absenteeism rates can lead to decreased productivity, increased workload for remaining employees, and potential burnout.
- Chronic absenteeism may indicate deeper organizational issues that need to be addressed, such as poor work culture or ineffective management.
- Employee scheduling and attendance tracking software to monitor and analyze absenteeism patterns.
- Employee wellness and engagement platforms to gather feedback and provide resources for improving workplace satisfaction.
- Integrate absenteeism data with performance management systems to identify potential correlations between absenteeism and job satisfaction or workload.
- Link absenteeism tracking with HR and payroll systems to ensure accurate leave management and absence reporting.
- Reducing absenteeism can lead to improved productivity, employee morale, and overall organizational performance.
- However, addressing absenteeism may require investments in employee support programs and resources, impacting budget allocation.
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Attrition Rate More Details |
The rate at which employees leave the organization, often used interchangeably with turnover rate.
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Assesses company's ability to retain talent and potential issues in company culture or compensation.
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Number of employees who leave in a period, average number of employees during that period.
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(Number of Employees Who Left / Average Number of Employees During the Period) * 100
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- An increasing attrition rate may indicate issues with employee satisfaction, work environment, or leadership.
- A decreasing rate could signal successful retention strategies, improved workplace culture, or better career development opportunities.
- Are there specific departments or roles with higher turnover rates?
- What are the primary reasons cited by employees who leave the organization?
- Conduct exit interviews to gather insights and identify areas for improvement.
- Invest in employee development programs and career advancement opportunities to increase retention.
- Regularly review compensation and benefits packages to ensure they remain competitive in the market.
Visualization Suggestions [?]
- Line charts showing attrition rates over time by department or location.
- Pie charts to compare reasons for attrition and identify common trends.
- High attrition rates can lead to increased recruitment and training costs.
- Consistently high turnover may indicate systemic issues that could affect overall organizational performance.
- Human Resource Information Systems (HRIS) to track and analyze employee turnover data.
- Employee engagement and feedback platforms to gather insights on job satisfaction and organizational culture.
- Integrate attrition rate data with performance management systems to identify potential correlations between employee satisfaction and job performance.
- Link turnover data with workforce planning tools to forecast future staffing needs based on historical trends.
- Reducing attrition can lead to a more stable and productive workforce, positively impacting overall organizational performance.
- However, efforts to reduce turnover may require increased investment in employee engagement and retention strategies.
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Average Tenure More Details |
The average length of time employees remain with the organization, which can reflect job satisfaction and loyalty.
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Highlights employee retention and loyalty, indicating long-term stability of the workforce.
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Total years of service of current employees, total number of current employees.
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Sum of Years of Service of Current Employees / Number of Current Employees
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- An increasing average tenure may indicate improved job satisfaction and employee loyalty, leading to better retention rates and reduced turnover costs.
- A decreasing average tenure could signal potential issues with employee engagement, work environment, or career development opportunities, which may result in higher turnover and recruitment expenses.
- What factors contribute to the length of time employees stay with the organization?
- Are there specific departments or roles with significantly higher or lower average tenures, and what could be the reasons behind these differences?
- Implement regular employee feedback mechanisms to understand and address concerns related to job satisfaction and career growth.
- Invest in professional development programs and opportunities for skill enhancement to increase employee engagement and retention.
- Conduct exit interviews to gather insights into the reasons for employee departures and identify areas for improvement.
Visualization Suggestions [?]
- Line charts showing the average tenure over time to identify trends and patterns.
- Comparative bar graphs displaying average tenures across different departments or job roles for benchmarking and analysis.
- Low average tenure may lead to a loss of institutional knowledge and experience, impacting organizational performance and productivity.
- High average tenure in specific roles or departments may indicate a lack of career advancement opportunities, potentially leading to disengagement and turnover.
- Human Resource Information Systems (HRIS) to track and analyze employee tenure data for insights and trends.
- Employee engagement platforms for gathering feedback and measuring satisfaction levels to address potential retention issues.
- Integrate average tenure data with performance management systems to identify correlations between employee satisfaction and job performance.
- Link tenure metrics with succession planning and talent management processes to ensure continuity and readiness for key positions.
- Improving average tenure can lead to a more stable and experienced workforce, positively impacting overall productivity and quality of work.
- Conversely, a declining average tenure may result in increased recruitment and training costs, as well as potential disruptions in team dynamics and project continuity.
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CORE BENEFITS
- 90 KPIs under Workforce Planning
- 15,468 total KPIs (and growing)
- 328 total KPI groups
- 75 industry-specific KPI groups
- 12 attributes per KPI
- Full access (no viewing limits or restrictions)
FlevyPro and Stream subscribers also receive access to the KPI Library. You can login to Flevy here.
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Career Path Ratio More Details |
The number of career paths or trajectories available relative to the number of employees, indicating potential for advancement.
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Shows effectiveness of career development programs and upward mobility within the organization.
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Number of promotions, total number of employees.
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Number of Promotions / Total Number of Employees
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- An increasing career path ratio may indicate a positive organizational culture that values employee growth and development.
- A decreasing ratio could signal a lack of opportunities for advancement, leading to disengagement and turnover.
- Are there clear and transparent career paths available for employees at different levels?
- How does the career path ratio compare with industry standards or benchmarks?
- Implement mentorship programs and training initiatives to help employees develop skills and progress in their careers.
- Create a clear and well-communicated career progression framework to guide employees on advancement opportunities.
- Regularly review and update job descriptions and requirements to ensure they align with career growth and development.
Visualization Suggestions [?]
- Line charts showing the historical trend of the career path ratio over time.
- Stacked bar charts comparing the distribution of career paths across different departments or job levels.
- A low career path ratio may lead to talent drain as ambitious employees seek opportunities elsewhere.
- An imbalance in career paths could result in a lack of diversity and inclusion in leadership positions.
- HR management software with career development modules to track and manage employee career paths.
- Performance management systems that integrate career path discussions into regular employee evaluations.
- Integrate career path data with succession planning and talent management systems to ensure a pipeline of qualified internal candidates for key roles.
- Link career path information with learning and development platforms to tailor training programs to employees' career goals.
- Improving the career path ratio can lead to higher employee engagement, productivity, and retention.
- However, a narrow focus on career path ratio alone may neglect other important aspects of employee satisfaction and well-being.
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Compensation and Benefits Satisfaction Level More Details |
The level of employee satisfaction with the compensation and benefits provided by the organization.
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Reflects employee satisfaction with compensation and benefits, indicating competitiveness and fairness.
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Surveys and feedback regarding compensation and benefits, number of employees.
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(Total Satisfaction Score / Number of Survey Responses) * 100
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- Increasing compensation and benefits satisfaction may indicate a positive shift in employee morale and retention.
- Decreasing satisfaction levels could signal potential issues with the competitiveness of the organization's compensation packages.
- Are there specific benefits or compensation components that receive consistently low satisfaction ratings?
- How does our compensation and benefits satisfaction compare with industry benchmarks or similar organizations?
- Conduct regular surveys and focus groups to gather feedback on compensation and benefits preferences.
- Benchmark compensation and benefits packages against industry standards and adjust as needed to remain competitive.
- Provide clear and transparent communication about the organization's total rewards package to employees.
Visualization Suggestions [?]
- Line charts showing trends in compensation and benefits satisfaction over time.
- Stacked bar charts comparing satisfaction levels across different employee demographics or job roles.
- Low compensation and benefits satisfaction can lead to increased turnover and difficulty in attracting top talent.
- Perceived inequities in compensation can result in decreased employee motivation and productivity.
- Employee engagement and survey platforms like Culture Amp or Qualtrics for gathering and analyzing feedback.
- Compensation management software to streamline the administration and analysis of total rewards programs.
- Integrate compensation and benefits satisfaction data with employee performance and turnover metrics to identify correlations.
- Link with talent management systems to ensure that compensation and benefits align with employee development and career progression.
- Improving compensation and benefits satisfaction can lead to higher employee engagement and productivity.
- However, increasing compensation and benefits without careful consideration can impact the organization's financial performance.
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Compensation Competitiveness Ratio More Details |
The organization's pay levels compared to the market average, indicating competitiveness in attracting and retaining talent.
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Measures how competitive the compensation is compared to market, affecting ability to attract and retain talent.
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Company's pay levels, market or industry pay levels.
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Company Average Pay / Market or Industry Average Pay
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- Increasing compensation competitiveness ratio may indicate a need to attract and retain top talent in a competitive market.
- A decreasing ratio could signal potential challenges in retaining skilled employees or a shift in market pay levels.
- Are there specific job roles or departments where the compensation competitiveness ratio is significantly higher or lower?
- How does our compensation competitiveness ratio compare with industry benchmarks or regional salary surveys?
- Regularly review and adjust compensation levels to align with market trends and remain competitive.
- Consider implementing additional non-monetary benefits or perks to enhance the overall compensation package.
- Conduct regular employee surveys or feedback sessions to understand their perception of the organization's compensation competitiveness.
Visualization Suggestions [?]
- Line charts showing the trend of the compensation competitiveness ratio over time.
- Comparison bar charts displaying the organization's ratio against the market average.
- A consistently low compensation competitiveness ratio may lead to high turnover rates and difficulty in attracting top talent.
- An excessively high ratio could indicate potential inefficiencies in compensation management or overpaying for talent.
- Compensation benchmarking tools such as PayScale or Salary.com to compare the organization's pay levels with industry standards.
- HR management software with built-in compensation analysis and reporting features to track and manage the compensation competitiveness ratio.
- Integrate the compensation competitiveness ratio with performance management systems to align pay with employee contributions and achievements.
- Link the ratio with talent acquisition and retention strategies to ensure that compensation remains a key factor in attracting and retaining top talent.
- Improving the compensation competitiveness ratio may lead to higher employee satisfaction and engagement, positively impacting overall productivity and performance.
- However, significant increases in compensation levels could also impact the organization's budget and financial resources.
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In selecting the most appropriate Workforce Planning KPIs from our KPI Library for your organizational situation, keep in mind the following guiding principles:
It is also important to remember that the only constant is change—strategies evolve, markets experience disruptions, and organizational environments also change over time. Thus, in an ever-evolving business landscape, what was relevant yesterday may not be today, and this principle applies directly to KPIs. We should follow these guiding principles to ensure our KPIs are maintained properly:
By systematically reviewing and adjusting our Workforce Planning KPIs, we can ensure that your organization's decision-making is always supported by the most relevant and actionable data, keeping the organization agile and aligned with its evolving strategic objectives.