Archive

Where to Look When Measuring ROI

By Linda Davidson

Sep. 1, 1998

HR professionals should be able to find links in all their efforts and investments to actual measurements. This chart indicates some of the areas to look when trying to demonstrate results. For example: Improved recruiting programs for sales could lead to improved time-to-fill ratios, which means positions would get filled more quickly, allowing the sales staff to generate more revenue and reduce “down time.”

HR Programs:

Possible Measurements:

Training Programs

Productivity, sales, quality, time, costs, customer satisfaction, turnover absenteeism, employee satisfaction

Compensation Programs

Labor costs, turnover, absenteeism (pay for performance)

Modified Work Structures

Productivity, quality, customer (teams, project committees, etc.) satisfaction, turnover, absenteeism, employee satisfaction, time to deliver

Recruiting Programs

Cost per hire, yield (# of candidates recruited), time-to-fill ratios

Total Quality Management

Defects, rework, response time

Employee Support Programs

Absenteeism, employee satisfaction, employee referrals, productivity

Workforce, September 1998, Vol. 77, No. 9, p. 38.

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