Question

Question to the Scenario below: Keeping in mind that it takes time/energy to implement systems to retrieve data, which HR metrics should start Paul capturing?

Scenario:

“John, our production numbers are getting worse,” said Roy, who is John’s manager at the small plastic molding company. “What’s going on?”

“ We've laid off several people in my area,” replied John.

“Can't you get them to work harder? asked Roy.

“Before the layoff, we had a lot of people quitting,” said John. “And the ones who are left just don't do as much work."

“Why did we have so much turnover?” asked Roy. “ What can we do to get these people up to speed?

“Well,” said John, “Some of the people said they were quitting because they could make more money someplace else.” “Others said it was a dead-end job and there was no place to go.” “I had two people quit awhile back who said the health insurance was better at their new jobs.” “And to be honest, I can see now that there are a few people who shouldn’t have been hired in the first place so it was just as well that they left.”

“We’ve got to do something,” said Roy. “The company is going to grow a lot in the next few years and we’ve got to be able to produce a lot of product once we start getting more orders again. Our numbers need to go way up, not down. I think we’d better go see HR.

Paul, the Director of HR at our small plastics company, reviewed exit interview information from voluntary terminations in the past year, after his first discussion with Roy and John. Then he set up a meeting with them to discuss the results.

Paul: As I looked through the exit interview notes I found some patterns that hadn’t been apparent before. The people who left because they got a better job or went to a company that had better promotion opportunities were all women or minorities. Were you aware of that?

John: No I wasn’t.

Roy: But really, these Hispanic women don’t really want to be the boss. They’re not comfortable in the role.

John: We tried one of them as a lead one time but it didn’t work out.

Paul: Have you mentioned your views about this to anyone else, inside or outside the company?

Roy: No

John: No

Paul: Good, because what you’ve just said could get us in trouble sometime. We’ll come back to this issue later, but I want to continue with the exit interview information. I also noticed that several of the women who left said they were uncomfortable with a lot of the stuff that goes on out there on the floor. We tried to get them to give us details, but none of them would. Can you tell me what you think they might have been referring to?

Roy: Gosh, I don’t know what they would be uncomfortable with. Do you, John?

John: Yeah, I think I do. The guys like to joke around, tell jokes, you know, boys will be boys. Some of the women don’t like it.

Roy: Well, I guess the guys shouldn’t do that.

Paul: No, they shouldn’t. And that’s probably the reason some of the women quit. The kind of behavior you’re referring to – off-color jokes and innuendos – is against the law. I can see we need to do some harassment prevention and diversity training around here. As far as hiring people for you now, what are your thoughts about the increasing Asian population in the area around our plant? I know in the past we’ve brought several Asian candidates in for interviews but nobody’s been hired. Any reasons for that?

Roy: John and I both think that Asians are hard to understand – their English isn’t so good. And when we had two Vietnamese working here a few years ago, they used to talk Vietnamese to each other and it was kinda weird.

Paul: We’ll need to have some more detailed discussions about this too, but for now let me just say that the turnover we had recently is hurting your production numbers now, right?

Roy and John: Yes

Paul: You’re going to need to make some changes in your assumptions about people, and in what you allow over there. I’m going to enroll you both in our Diversity and Respect training series. Let’s get together and talk some more after that.

Roy and John: Okay.

When Roy and John attended the Diversity and Respect Training, they were very surprised at a lot of the information.

John: I had no idea that telling off-color jokes was illegal, did you?

Roy:   I sure didn’t. I also didn’t realize how many different ethnic groups we have in this city.

John: I did know about a lot of the ADA accommodations, but I didn’t know that substance abuse can be considered a disability.

Roy: And I didn’t know about the “job relevance” test – like requiring people to speak English at work, and other job requirements  

Paul: John and Roy, we've been talking about the turnover in your department and why so many people have been leaving. In addition to what I've already mentioned, several people who left said in their exit interviews that they were never sure exactly what their job responsibilities were, and they felt sometimes they were asked to do things that they weren't supposed to be doing. Do you know what they're referring to here?

Roy: Well, it's been quite a while since we've had accurate job descriptions....

John: I've shown them what we have, but we've had quite a few changes in technology and so people are doing things differently now. Plus, we've been using teams a lot more now, and this doesn't show up in any job description we have.

Paul: I've been meaning to update those job descriptions, but it's quite a chore. Takes a lot of time.... I'll try to get to it as soon as I can. Maybe I can get an intern or somebody to help me.

Paul arrived at Bumpbie Company 18 months ago, as the first HR professional the company ever had. Started fifteen years ago by two brothers, the company has been experiencing a “growth spurt” for the past 3-4 years, fueled by increasing demand for small plastic parts: computer keyboards, toys, airplanes….a wide variety of needs. Paul was directed by the owners to “use HR to keep us staffed up so we can grow” and to “keep us out of court.” The company has a single location which is in an industrial park outside a major metropolitan area.  

When the company was founded most of their workers were Caucasian and about 20% African-American because this was the racial make-up of the surrounding area (labor market). In the past few years people of many different ethnicities have moved into the area: Hispanics, Asians, people from India, Bosnians, Serbians, and Russians, among others. Bumpbie’s employees are primarily Caucasian and African-American, although there are two Hispanic employees and one Vietnamese. There is a high demand in the local labor market for semi-skilled labor like the majority of the jobs at Bumpbie.

As soon as Paul arrived, he attempted to get relevant data and HR metrics so we he could understand the company’s strengths and weaknesses regarding their labor force. While he was able to piece together some data, a lot of it just wasn’t available or if it was available, it wasn’t easy to retrieve and analyze.    

Answer 1

answer-

Keeping in mind that it takes time/energy to implement systems to retrieve data, which HR metrics should start Paul capturing?

Employee Engagement: It’s essential that you balance employee engagement with employee productivity in order to ensure that managers don’t abuse or burnout their employees in an effort to maximize productivity. Both are important, and there are studies that demonstrate the impact of high engagement on productivity and a firm’s success. Managers should be rewarded for both high productivity and high employee engagement scores.

Metrics include: A. The percentage of employees who “look forward to coming to work” everyday (from survey results) B. The percentage of employees who feel that their managers exercise expected management behaviors (from survey results relating to two-way communication, challenging and exciting work, exceptional growth and learning, recognition and reward, some degree of control over their job, and knowing that their work makes a difference)

Recruiting: Managers consistently rate recruiting among the top three things they expect from HR. Without overdoing it, here are some simple metrics that you can use to assess recruiting effectiveness:

A. Number of overall days that key positions were vacant (due to recruiting)

B. Average performance appraisal score of new hires (compared to last year for the same job)

C. Manager satisfaction with new hires (survey hiring managers; compare results to last year’s average)

D. The turnover rate of new hires within the first year

E. The percentage of diversity hires in managerial and senior positions

F. The dollar impact of a bad hire in key positions

Retention : Retention is also a highly rated management issue. In this case, most turnover measures are too simple. Potential metrics include:

A. Overall employee turnover (not recommended)

B. Performance turnover in key jobs (where performance turnover means that top performer turnover is “weighted” more heavily and bottom performer turnover more lightly than average worker turnover)

C. Preventable turnover in key jobs (where a sample exit survey is used to identify the real reasons individuals left the organization and whether the turnover could have been reasonably prevented)

D. Diversity turnover in professional, managerial, and technical positions

E. The dollar impact of employee turnover in key positions F. Managers’ overall satisfaction rate with HR’s retention efforts and the impact of these efforts on team productivity (survey of a sample of managers)

Overall HR Costs : Even though overall HR costs are relatively small compared to all general and administrative expenditures, it never hurts to have a metric to ensure that the dollars spent in HR are resulting in a continuous rated improvement of workforce productivity.

These above metrics should be captured by Paul.