Magic numbers – Action Research in introducing HR metrics

Abstract

This insider action research project explores the effects of Human Resource (HR) measurement on the practitioners.  Research unfolds in an organization where refocusing and professionalizing of HR practice is in progress. The study discusses how HR metrics was introduced in an organization, what drove the choice of initial metrics, what was the impact of its persuasive characteristics on the practitioners and its signaling effect in an organization. It discusses how HR metrics helped the HR department to effectively move from attending to short-term, ad-hoc operational needs of managers to implementation of long-term value-add operational and developmental activities that have organization-wide implications. Metrics is seen as a work-in-progress to drive appropriate behavior within the HR team. The study thereafter identifies personal theories in practice. The study argues that maturity in people orientation and sophisticated measurement mechanics are not a prerequisite to start measuring; the initial aim of metrics may be to improve departmental performance rather than enhancing credibility with line managers by demonstrating financial/organizational impact of HR value-add. Such an approach leads to overall salutary effect as influence of HR in many of its own metrics is rather weak and inconsequential. The contribution of this study is value-influence matrix that identifies HR metrics in terms of value to business and influence of HR.