March 30, 2022

Talent Analytics Strategy: How to Track Metrics & Manage KPIs

Everyone’s familiar with the phrase “Where there are people, there are problems,” right? Well, when we think through a talent analytics lens, we take a different approach: where there are people, there is opportunity. And the way to discover that opportunity is simple: data.

What Are Talent Analytics and How Can You Use Them?

Talent analytics comes in many forms – you may have heard it referred to as “people analytics,” “human resource analytics,” “workforce data” and more – but the goal of tracking it comes down to understanding your workforce.

When you understand your workforce, you understand how to attract your best candidates, retain your best employees, promote leaders that make a difference and, at the end of the day, boost your company’s bottom line. Talent analytics is data with which employers can accurately measure behaviour and performance in their workforce

According to LinkedIn’s Global Talent Trends report, respondents employ talent analytics mostly for the following five purposes:

– Measuring employee performance: This is the most obvious use of talent analytics: analyzing your existing talent! Where are employees being challenged? Where is time being wasted? Where are managers being effective, and where do they need more help?

– Strategic workforce planning: Talent analytics can also be predictive. What type of talent will you need months or years from now? How can you attract and retain it? This is a key example of talent analytics aligning with overall company goals.

– Identifying skills gaps:You can’t train folks if you don’t know what they don’t know. Employee surveys, interviews, and more can help you determine where the company might need to step up to support learning initiatives for employees.

– Evaluating recruiting channels: Talent analytics can show you who you’re reaching, and who is absent from your roster. This will help you identify the recruiting channels that are working, and the networks you have yet to tap effectively.

– Assessing talent supply and demand: do people come to you? Why do they leave?

Common Talent Analytics KPIs to Track and Measure

Crucial to gathering a data set that paints a holistic picture of your company is choosing the right key performance indicators, or KPIs, to measure. They’ll help you frame questions you’ll look to your dataset to answer. They’re also company or department-dependent: KPIs to show the progress of employees in the customer service department will likely be softer and more qualitative than those that would indicate success of a sales rep. Here, we list some of the more all-encompassing KPIs for your HR dashboard.

Engagement KPIs:

– Turnover: – What it tells you: This is a metric that needs to be in your KPI quiver, because high turnover at a company is a bad sign – for everyone. It could indicate bad pay, bad management, poor mobility, bad hiring practices. But worse, even just one employee leaving can send out a shockwave: they might have been another employee’s best friend, or a customer’s favourite contact. Pair this data with information gathered in exit interviews to understand the bigger picture.

– How to calculate it: number of employees who left / avg. number of employees x 100

– Absenteeism rate: – What it tells you: Absenteeism could be an indicator of a number of things in your employee base, but as a KPI it can point towards which folks aren’t as engaged in their work. This metric, however, should be combined with interviews – absenteeism might also mean they have a chronic illness, are taking care of family members, are managing multiple jobs, or need extra support.

– How to calculate it: Absenteeism rate = absent days / total number of working days.

– Retention:

– What it tells you: Retention as a KPI can give HR managers and companies a look at the microcosm of their work ecosystem, particularly when it comes to how effective managers are. According to Gallup, good management can mean employees are 62% less burned out, and therefore more likely to stick around.

– How to calculate it: Number of employees remaining / total number of employees.

Performance KPIs:

– Skills gap:

– What it tells you: This metric is collected with more qualitative methods, but it should tell you where your employees need to grow (and want to grow). According to that LinkedIn Global Talent Trends report, companies who invest in training their employees showed 53% lower attrition than competitors who don’t.

– How to calculate it: This one’s a little tricker, and will require some critical thinking on the HR manager’s part. The key is to track the cost-effectiveness of training programs, perhaps through post-program satisfaction surveys, listing course completions, tracking minutes of learning vs. working per month, etc.

– Employee productivity rate:

– What it tells you: At its most simple, this metric should tell you how much, on average, your employees are earning for you. Drill this one down to teams, if you can, to show which teams (and which folks on those teams) are performing at their best.

– How to calculate it: company revenue / number of employees.

– Work quality:

– What it tells you: Are your employees meeting goals that they set with their managers? Are they hitting their 90-day benchmarks? In industries with tangible ways to measure performance, like manufacturing, are product defects on the decline?

– How to calculate it: Interviews and incident reports should give you insight into a specific employee’s work quality.

Bonus: Some Hiring KPIs:

– Cost to hire:

– What it tells you: From recruitment and outside agency costs to paying out internal benefits, it can be pricey to hire and onboard. Cost to hire tracks that investment to help you understand its impact to your bottom line and if it’s paying off.

– How to calculate it: total amount of money invested / the number of hires in same time period.

– Time to hire:

– What it tells you: A similar thing, but factoring in time spent over money spent. Both time to fill and time to hire will give you a look at two things: how effective and efficient your internal hiring processes are, and the scarcity or abundance of talent in the market.

– How to calculate it: Track distance between these points: job requisition and candidate acceptance date.

How to Manage Your Talent Analytics KPIs

Okay, so you’ve chosen your KPIs as a team. You know what you want to track. But how do you manage all of that data?

This is the fun part: building an analytics system. We have a few suggestions and resources to point you in the right direction:

– Integrate: Put everything together. Choose software (we’re partial to Power BI) that will help you take multiple streams of data (qualitative and quantitative) and funnel it all into one, easily readable dashboard.

– Automate: Create or build a system where you can set it and forget it. It’s that simple. Your numbers should generate themselves as you collect data. You can automate your processes to make weekly or monthly number pulls easy-peasy!

– Be Generous: Anyone who is in the numbers on a daily basis should have access to this data. So once you simplify and automate your dashboard, hand out the keys. The more workers who have access to the data they need to see, the better; they’ll be able to catch issues before they become bigger, understand where they need to step up, or create reports to higher-ups who need them.

Want more resources on building out your own analytics system? Check out these blogs:

– Talent Analytics: How to Track, Measure and Make Sense of Your Data

– 4 Common Mistakes Companies Make With Their Analytics Systems.

At dbrown, we love to give companies a helping hand to empower them to own their data gathering. Need a little help? Reach out to us any time.