Measuring HR Contribution
Each HR Manager should be able to measure the contribution of HR to the business. The organization keeps HR on its payroll, the HR should present the result and its contribution to improving business results. Easily said, it is extremely hard to implement as HR is about the soft part of the business, it is not possible to transfer the results easily to numbers and not provoking the discussions about the methodology for measuring the HR contribution.
The HR Contribution can be generally measure by two main outcomes for the organization:
- cost savings in HR Processes
- cost savings by efficient HR Processes for the organization.
The cost of Human Resources is always allocated to the internal clients and they have to pay for its HR Services. That is the main reason, the internal client is always interested in the contribution of Human Resources to the final results.
The main mistake in the measuring of the HR contribution is not collecting the data, which are the key to show the real HR Results. The methodology for the HR Measurement does not exist and the internal clients do not receive consistent HR Data and they cannot measure any trends in the real job done Human Resources.
The HR Management team has to invest a lot of time into setting the right set of HR Measures, which will be interesting for the internal client. The measures are not about the performance of HR Processes, but they have to translated into the real contribution of HR to the success of the internal client. The HR Contribution Measurement is not about the HR Processes, it is about the value added to the organization.
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