Because people pay attention to what gets measured, carefully selecting key metrics to track can help focus employees on key behaviors and outcomes. But too much information makes it difficult to focus attention on the metrics and outcomes that are the most important. To evaluate its staffing success, telecommunication company Avaya sets goals for how many experienced employees it intends to acquire from its competitors. The company also measures the performance of individuals who move internally from one business to another compared with the average performance of employees in that division. One company representative says, “Most companies will say their recruitment is successful if they retain the people that they hire. We look beyond that and set very specific goals for ourselves.” 14
Southwest Airlines measures key metrics including cost per hire, new hire quality, compensation, time to productivity, and retention and promotion rates of high-potential employees and uses these measurements to continually improve its staffing and talent management process. If Southwest notices that an operational group is logging above average overtime, for example, it works with that group to reduce overtime by decreasing turnover or increasing staffing.15
Staffing metrics can be thought of as long term or short term, and can be efficiency or effectiveness oriented. Next, we discuss these different types of metrics and how they are best used.
Metrics can be tracked over many different time periods. Short-term metrics help a firm evaluate the success of its staffing system in terms of the recruiting and new hire outcomes achieved. These metrics include:
· The percentage of hires for each job or job family coming from each recruiting source and recruiter
· The number of high-quality new hires coming from each recruiting source and recruiter
· The number of diverse hires coming from each recruiting source and recruiter
· The average time to start (by position, source, and recruiter)
· The average time to contribution (by position, source, and recruiter)
Long-term metrics help a firm evaluate the success of its staffing system in terms of the outcomes that occur some time after employees are hired. These metrics include:
· Employee job success by recruiting source and by recruiter
· Employee tenure by recruiting source and by recruiter
· Promotion rates by recruiting source and by recruiter
Short-term metrics are useful as leading indicators of a company’s ability to have the right people in the right jobs at the right time to execute its business strategy and to meet its immediate staffing goals. Long-term metrics are useful as lagging indicators. They are best used for evaluating the effectiveness of the firm’s long-term staffing system—for example, the long-term, on-the-job success of employees and their turnover and promotion rates.