Human Capital Benchmarking Survey SHRM Forum Pakistan

“If you can not measure it, you can not manage it”

The field of Human Resource Management needs to account for the short- and long-term costs and benefits of HR activities. In order to act as business partner, HR professionals are expected to measure the effectiveness of HR programs at input/ output level and establish benchmark ratios which are comparable to HR Departments of other organizations with identical sector and staff size. They should be able to quantify, and talk in terms of numbers and ratios rather than using intuition and gut feelings for justifying their contribution or for effective decision making. HR numbers and ratios that have the potential to pave way for informative decision making are not confidential in nature. HR benchmarking surveys are conducted throughout the world to facilitate people management decision making at organizational level. Examples of these include the benchmarking survey by SHRM in the US and WERS survey in the UK. In Pakistan, HR professionals need to work together to improve the contribution and profile of HR, so that HR is increasing recognized as the field managing human capital to achieve organizational objectives. The business environment is getting tougher on account of tight budget justifications, while at the same time human capital is an increasingly critical asset in today’s knowledge economy. Business leaders are keen to know how investment on talent management impacts the top and bottom line in an organization.

Objective of Study
• • Main objective of this study is to measure key metrics in staffing, developing, rewarding and retaining effective workforce in sample organizations and also establish workforce productivity benchmarks. Diagnosing HR metrics and productivity benchmarks, HR can quantify its output, the organization can analyze its performance against industry standards, and can aim to to become competitive/ cost effective.

• A questionnaire has been designed to collect the basic data from SHRM Forums pertaining to their organization. Study report along with analysis will be shared with participating members.

This report and the questionnaire will be used as a base to coduct country wide survey in the coming 6-9 months. The Pan-Pakistan study will aim to collect data for 500-1000 organizations, depending on resource availability, for indepth anaylsis.

Pilot study completion: 15 August 2011 Comprehensive Pan Pakistan study completion: 15 Nov 2011

Benefits of Study
Metrics act as a windshield to navigate through market challenges in terms of effective people management. They are also vital tools to respond to emerging organizational change initiatives and a point of leverage to improve the contribution of HR to the overall business. Being a fact based talent decision framework, HR practitioners can use it as an opportunity to come at the fore front of business equation.

Key Areas of Study
Being a pilot project, the research study will focus on the following HR metrics and productivity benchmarks: 1. HR staff to organizational staff ratio 2. Gender diversity ratio 3. Compensation/revenue ratio 4. Compensation/cost ratio 5. Staff turnover ratio (Voluntary) 6. Staff turnover ratio (Involuntary) 7. Cost per hire 8. Average time to fill vacancy 9. Internal hire to external hire ratio 10. Training investment ratio 11. Average training hours per staff 12. Revenue per FTE 13. Cost per FTE 14. Profit per FTE 15. Human Capital ROI

Research Panel
Dr Sadia Nadeem MCIPD, Head/ Associate Professor, FAST School of Business, in collaboration along with the selective members of SHRM Forum Pakistan have designed the questionnaire. Two HR students, Ms. Durria Anjum and Ms. Misbah-Ul-Ain, have been assigned to complete the project under supervision of Dr Sadia Nadeem. All the ethical aspects of survey including confidentiality of respondent organizational information will be strictly adhered. The data gathered by members will only be used for purpose for which obtained.