SIDDHARTHA CONSULTANCY SERVICES

Add: B-7&8, Ganesh Nagar, Pandav Nagar Complex, New Delhi-92 www.scsuniversal.com

WHAT IS HR STRATEGIC OBJECTIVE, ITS INDICATOR AND HOW TO

MONIOR IT FOR ORGANISATIONAL BENEFITS:
Human resource plays a vital role in organizational growth & its effectiveness. Its entirely depends upon
number of factors involved human resource management. There are no short cuts when it comes to building
a great organization. There are, however, creative ways to discover solutions to the challenges you and your
organization face. It begins with you:

1. You must be willing to face your organizational challenges head on and come out a strategic plan to
combat it.
2. You need to invest your time and energy in designing an effective strategy and strategic objective
for the future.
3. You need to look at your own willingness, ability, and capacity to lead and to develop your
leadership qualities.
4. You need personal commitment to both unlearning what you know and learning what you need to
know.
5. You need to develop your leadership capacities and discover how to introduce and manage change

The value of measuring of Human performance you have to ask two basic questions

1. What’s the value of measuring the effectiveness of HR process?

2. How do you currently measure the effectiveness of HR process & what are you doing now to track
the effects of your HR efforts.
Effective measurement systems serve two broad organizational purposes

1. Guide in decision making process

2. Evaluate program / departmental effectiveness for the attainment of overall organizational
objectives.

For the effectiveness and usefulness to an organization, measure of human resource development
effectiveness should:

1. Identify a clear, consistent and compelling connection between the organization’s strategy and the
work of each employees
2. Document the effects of human resource on an organization performance in credible ways that
employees, line managers and supervisors can easily understand.
 THE VALUE OF STRATEGIC THINKING AND PLANNING

We believe that every organization can benefit from a strategic plan. The value of a plan lies in both the
discipline it brings by systematically guiding deep reflections about the organization's future and the forces
influencing that future — and in the resulting roadmap that charts a path into that future. The formal step-
by-step process of identifying the organization's core purpose or ideology, assessing the complex
environment in which it operates, and defining the methods it will use to fulfill this purpose can be a
healthy and cathartic exercise that gets the organization to ask the big questions.

By itself, however, the strategic plan isn't enough. Developing strategic thinking is just as important as
developing a strategic plan — if not even more important.

KPI for Measuring Employee Productivity

1. Average sales turnover per employee:

(Total Sales / Number of employee)

2. Average profit per employee:

(Net Profit/ Number of employee)

3. Human Capital Value added per employee - (Value of workforce’s knowledge skills and performance. This
measurement illustrate how employees add value to organization

(Revenue-(Operating Expense – {Compensation cost + benefits cost})/Number of employee

4. Absenteeism Rate:

(Number of Days absent in a month) / (AVG employees during month x Number of workdays) x 100

5. Health Care cost:

(Total cost of health care) / (Total employees)

KPI for Measuring Employee Cost

1. Employment costs as % of sales turnover / profit

2. Employment costs per employee or cost per hire

(Advertising + Agency Fees + Employee Referrals + Travel cost of applicants + Relocation cost + Recruiter
pay and benefits) / Number of hires

3. Employment costs as % of operating costs

3. Employment costs as % of operating costs

KPI for recruitment process

KPI for recruitment process
1. Number of applicants attracted per method

2. Number of applicants attracted by length of time

3. Costs per applicant attracted

4. Ratio of qualified to unqualified applicants attracted

5. Time from start to hiring of applicant (Time to fill) –

Total days elapsed to fill requisitions / Number Hired

6. Total recruiting cost per employee hired

7. Job performance and tenure of employee attracted by method

8. Number of candidates interviewed

9. Proportion of those interviewed who receive invitations to visit

10. Proportion of those invited who accept offers to visit

Other Important KPI for HR Process:

Strategic Objective Key performance Indicator (KPI)

Drive Long Term Share Holder value Share holder value

Share holder value growth

Enhance ROI of HR Strategic initiatives (Return on ROI of strategic programmes and initiative
investment ratio for employees. Did organization
get return on their investment? Analyze causes of (Human Capital ROI) = (Revenue-{operating
positive / negative ROI metric. Use analysis as expense-(compensation cost + Benefits cost)} /
opportunities to optimize investment with HR
(compensation cost + Benefits cost)
practice such as HR practice are having a casual
relationship in positive changes to improve

Enhance Employee Productivity Profit per employee

Revenue per employee

Create positive work environment Ranking to best place to work by annual survey (By
any magazine in to this field)

% of employee turnover rate

Number of resignation during month/(Average

number of employee during month) x 100
Enhance internal customers (employees Employee satisfaction index
satisfaction)

Apply excellent recruitment process Average lead time to recruit employee

Recruiting cost per employee

Performance of new recruits for first two years of

employment ( Discussed above separately)

Develop strategic competencies Average lead time to develop strategic

competencies

Average lead time to close strategic competencies

gap

% of strategic competencies available with in the

organization

Develop internal HR capabilities % of HR employees who develop individual

development plan

% of HR employee who fully execute their

individual development plan

Deploy HRIS system Progress of HR Portal implementation vs planned

Accuracy level of HR database

Article By , Mr. Gajendra Khare (M.Sc. (Maths), DIMS, MPA)

Founder – Siddhartha Consultancy Services

Former HR and Administration Manager, Apparel Group UAE; Mr. Khare has about 14 years of working experience with
many prestigious organization of the country and overseas in the field of Human Resource Development (HRD),
Administration, Liasoning, ISO-9000, MIS (Management Information Systems) and others. He has worked on a number of
HRD and quality related assignments of various organizations. He has also worked in the area of Management Information
Systems and implemented ERP modules in industries.
He has been a member of various professional organizations in the fields of HR and quality etc. Mr. Gajendra Khare has
developed and implemented various HR solutions to the industries successfully. He has also implemented ISO-9001:2008,
ISO 13485 :2003 CE and WHO: GMP certification and also handled various administrative assignments and completed
successfully. Contact: +919971090494;
Email: gkhare@scsuniversal.com; gajendra.khare@gmail.com, web: www.scsuniversal.com