PRESENTATION

1. PwC Saratoga:
measuring HR
effectiveness
The approach
www.pwc.com

2. PwC
Our business:
The MEASUREMENT,
BENCHMARKING and
STRATEGIC APPLICATION
of human capital information
“Bringing objectivity and business alignment
to human capital activities”
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3. PwC
Effectiveness of the HR function is a key issue
…what the world’s CEOs are saying?
3
37%believe the
global economy will
improve over the coming
12 months, compared
with 44% in 2014
72%are concerned
about the
availability of key
skills
71%plan to implement a
cost reduction activity
46%use data
analytics to get insight
into how effectively
skills are being
deployed within the
organisation
81%are seeking
broader range of
skills
Source: PwC 18th Annual Global CEO Survey (2015)
50%plan to
increase
headcount in 2015
Mongolian CEO’s:
62% plan to implement cost
reduction activity
51% will increase headcount
85% find difficulty in recruiting
and retention of high-potential
middle managers
42% have plans in implementing
use of data and data
analytics

4. PwC
C-suite is increasing
focus on human capital
HR is being challenged to answer more
complex questions such as …
How do we compare with the competition and the
‘best’?
Is our business sustainable - are we future-proof?
Are we attracting and developing talent?
What is the impact of our talent strategy?
Do we have good leaders … are our people with
us?
Is our HR function and HR shared services
effective?
How do our HR policies impact business
performance?
"We need to improve our analysis to help
the business drive the top-line.”
“The key improvement that is needed is
faster information, with more depth of
analysis comparing us to the outside
world.”
“Regular management reports are often
late. There is a great deal of unnecessary
detail, and even I can frequently find
errors.”
“There is very little insight provided, and
little value-add. If I ask for comment or
pose questions, they are answered
reactively, but pro-active commentary is
lacking.”
… but they question
HR’s ability to respond
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5. PwC
PwC Saratoga
• A tool to bring an objective evidence-base to managing people in organizations.
• More than 30 years of experience in Human Capital effectiveness measurement.
• More than 16,000 organisations from various industry sectors around the world. Saratoga
works with 40% of the FTSE 100 and the Fortune 500.
• Constantly updated methodology.
The results of HR Benchmarking will provide you with the following information:
 What is the human capital return on investment for each full-time employee (i.e. how
much do you get back for every dollar you invest in your people)?
 How much money does each full-time employee make for the company?
 Are learning and development costs effective?
 What is staff turnover and absenteeism costing your organisation annually?
 Can you reduce recruitment costs?
 How efficient is the compensation package structure in your organisation?
 How effective is the structure of your HR department?
5

6. PwC 6
Global database coverage 2014
The PwC Saratoga database comprises
>2,600 organisation datasets globally
comprised regionally as follows:
Growth is currently around 10% per annum
Europe, Middle East and
Africa 57.5%
Asia Pacific 15%
America 27.3%
0.0% 5.0% 10.0%15.0%20.0%25.0%30.0%35.0%
Transport and logistics – 2,6%
Public sector – 9,0%
Retail and leisure – 5,3%
Chemicals - 2,3%
Pharmaceuticals – 6,2%
Utilities – 4,1%
Engineering/manufacturing –
30%
Financial services – 18,6%
Professional services – 3,3%
Technology – 10,9%
Communication and media – 5,5%
Other – 2,2%

7. PwC
PwC Saratoga’s global coverage
Asia Pacific
Australia
China
Hong Kong
India
Japan
South Korea
New Zealand
Taiwan
Thailand
Singapore
South America
Argentina
Bolivia
Chile
Colombia
Ecuador
Peru
Uruguay
North America
Canada
US
CEE
Bulgaria
Czech Rep.
Hungary
Kazakhstan
Poland
Romania
Russia
Serbia
Slovakia
Turkey
Middle East
Kuwait
Qatar
Saudi Arabia
UAE
EMEA
Belgium Greece South Africa
Denmark Ireland Spain
Finland Italy Sweden
France Netherlands Switzerland
Germany Portugal UK
Central America
Costa Rica
Guatemala
El Salvador
Mexico
Nicaragua
Panama
7

8. PwC 8
Saratoga provides the HR benchmarking in three
aspects
INPUT OUTPUT
HR Measurement
Financial impact and
productivity
•Revenue per FTE
•Cost per FTE
•Profit per FTE
•Remuneration/Revenue
•Remuneration/Total Costs
•Average remuneration
•Human Capital ROI
•…….
•…….
HR Delivery
Measurement
Bringing in the right people
•Recruitment rate
•Cost per hire
•Acceptance rate , etc.
Developing people
•L&D investment per FTE
•L&D hours per FTE, etc.
Rewarding people
•Average compensation
•Average benefits
•Benefits/Compensation, etc.
Losing people
•Absence rate
•Termination rate
•Involuntary term. rate, etc.
People Productivity
and financial impact
Human Capital Impact
•Productivity
•Financial impact
Human Capital
Engagement
Compensation & benefits
Absence
Turnover
L&D
Talent & succession
Performance management
Organisation Structure
HR function
Resourcing
Employee relations
Workforce structure

9. PwC
PwC Saratoga metric benchmarking input
questionnaire
Page 9

10. PwC
Sample output: Scorecard analysis
Page 10
Turnover Your Metrics Sample Percentiles Sample Europe Percentiles Europe
2002 2003 2004 25th 50th 75th Rank 25th 50th 75th Rank
Resignation Rate (%) 6.4 6.6 7.3 4.9 5.8 7.1 78 3.9 8.1 14.1 44
Metric and Unit of
Measurement
Quartile data for your
bespoke sample
Quartile data for the full
European database
Your Metric results,
including trend periods
Your Percentile Rank position
versus the samples
Turnover Your Metrics Sample Percentiles Sample Europe Percentiles Europe
2002 2003 2004 25th 50th 75th Rank 25th 50th 75th Rank
Resignation Rate (%) 6.4 6.6 7.3 4.9 5.8 7.1 78 3.9 8.1 14.1 44
Metric and Unit of
Measurement
Quartile data for your
bespoke sample
Quartile data for the full
European database
Your Metric results,
including trend periods
Your Percentile Rank position
versus the samples

11. PwC
Sample output: Key metric profile
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KEY METRIC PROFILE:
Threshold value to PwC Saratoga
suggested target 'Best' quartile
Your result showing a performance gap
versus the 'Best' quartile threshold
Your result achieves the suggested target
quartile
2.4
4.72.4
1.9 

12. PwC
Benefits of measurement
For the organisation
• Increases the focus of human capital on the
business agenda
• Produce objective measures of human capital
performance revealing genuine as opposed to
perceived action areas
• Allows target-setting and performance
monitoring
• Reveals better performers and good practice
across business units
• Demonstrates your competitive market position
and versus external ‘best’ practice
• Contributing to business-aligned management
reporting
• Challenging existing practice - kicking
complacency
• Hard feedback - raises questions and provokes
debate
For HR
• Improving HR-business strategy alignment
• Helps define evidence-based human capital
strategy and HR programmes
• Clarifying HR and human capital priorities
• Provides business-case evidence for changes in
HR/HC policy and practices
• Helps HR understand its own structure and
performance e.g. functional best practice,
identifying cost savings, efficiency gains and
service improvements
• Raises the profile of HR
• Aids communication with Board members and
other senior business colleagues
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13. PwC
Examples of how clients used our benchmarks
• To develop a portfolio of people and HR measures that aligned with business and
people strategy;
• Improve reporting standards and processes;
• Support business cases for technology investment, process improvement, headcount
reduction and identify potential saving;
• Identify characteristics of ‘best practice’ HR processes in order to build ‘best in class’
HR function;
• Develop a baseline of current performance of the HR function prior to undergoing a
transformation programme to improve the efficiency levels of HR service delivery;
• Compare the performance and cost of HR operations across different regions;
• Compare current performance with other best practice functions operating the same
model (i.e. HR Shared Service), identify potential cost savings that could be achieved
within the function, whilst maintaining a high standard of service.
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14. PwC
Plan for Mongolia
Page 14
Preparation
stage:
• Registration of
participants
Filling in
questionnaires by
the participants:
• Collection of data
electronically
• Assistance from PwC
experts
Data collection
and analysis:
• Participants submit
the data and we run
the data validation
Report
preparation:
• Access to the reports
for participants is
provided
April 2015 May 2015 June 2015 July 2015
• First time launch in Mongolia
• Work with HRS experts from PwC
• Launch the Saratoga survey with the PayWell Salary Survey

15. PwC
www.pwc.com
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