Benchmarking: why it is time for a change of focusOn 28 Nov 2000 in Personnel Today Thefinance, engineering and production parts of a business are relatively easy tomeasure and compare. The function and disciplines of HR are, however, built onshifting sands. Tomorrow’s legislation can cause us to change focus suddenlyand devote the main part of our attention to an activity that was previouslyneglected. But the need to be flexible, proactive and equally reactive do notmean we should be immune frommeasurement and unaccountable for the resources devoted to HR.Human assets There isno doubt that, at one extreme of benchmarking “human assets”, the desire tomeasure is in danger of becoming an end in itself. Because of the complexities,differences, fluidity and regular changes in the people side of the business weshould rely on a few key measures.In over 20years of studying HR practices we have seen that some of the most effective andvalue-added HR functions have staffing levels approaching a quarter of those insome ineffective functions – effectiveness measured on an anchored scale. Sothere are no “perfect answers” or ideal staffing ratios and balances inHR. So thereare no perfect measures. We must, however, seek out key ratios and statisticsthat can be readily collated and easily compared if there is to be any basisfor improvement. Surprisingly few HR functions – less than 30 per cent, according to recent research –have a clear understanding of how time is allocated to activities anddepartments.Thereforea straightforward activity analysis should be maintained in HR, whether it iscentralised or devolved. This pro- vides a mechanism for internal measurementand comparison on a “period-by-period” basis. It is also the first-level datafor any form of external benchmarking. Who doeswhat and at what cost is a powerful measurement. Beyond this, we should measurethose issues that have a financial edge, such as the cost of recruitment andturnover, absenteeism, disciplinaries, how much line management and externalresource is involved. So if benchmarking is to be cost-effective it isimportant to ensure that:· Thewhole HR team is involved· Theparameters are agreed and clearly defined.· Themeasures are manageable and are seen to be of value to your organisation.· Thetarget comparator organisations agree your definitions.· Theprocess has a clear time scale and is managed effectively.Using anexisting framework with tried and tested parameters is likely to be the mostcost-effective option. But always be sure that the framework and comparatorgroup can include measures you regard as critical for your organisation .By DerekBurnPartner,MCG Consulting [email protected] Related posts:No related photos. Previous Article Next Article Comments are closed.