Two recent events have brought HR back to their core role – managing risk.
In Australia, we have seen large numbers of staff getting underpaid in some sectors, such as retail and hospitality. For some of these businesses, it’s precipitated the collapse of the company. For others, it’s impacted their share price as these businesses make provisions for back pay in the hundreds of millions of dollars.
Globally – the coronavirus impacts on HR more than any other function. HR has to lead on managing health and safety for employees, guide organisations on remote working, support the CEO and leaders on their internal communications and public response to coronavirus, and a lot more.
Apart from those current risks garnering a lot of media attention, what business risks really ought to matter to HR?
Ask a CEO of a sales/service business what they believe carries more risk to their bottom line – increasing turnover coupled with a high cost to hire, or a declining engagement score measured from a survey?
Cost to hire is easy to calculate when you use tools like these https://www.predictivehire.com/time-saver/ and are even easier to reduce when you automate your candidate screening
If you are hiring just 100 people a year, you can expect to LOSE 80 DAYS of work capacity to recruitment. Using automation tools like ours reduces that by 80% giving back 504 hours to the business. Click here to see case studies on time savings from using PredictiveHire.
HR managing business risk means tracking metrics like:
1. Cost to hire – which should be the direct (the recruitment team for example) and indirect costs (the opportunity costs of all the people involved in recruitment)
2. Time to hire for any organisation that relies on frontline staff to deliver value- sales or customer service
3. Turnover especially early churn and non-regrettable churn, which is a good objective measure for quality of hire
4. The percentage of promotions within, only if you use hard objective data to make those decisions
5. Most of all, whether these metrics are going in the right direction quarter on quarter
Next month we release our latest whitepaper on this topic: Back to Basics: HR’s role in delivering business performance. Click here if you want to receive a copy upon release.
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