The document outlines six key HR metrics to measure in 2019, focusing on the importance of data and analytics in talent management, including quality of hire, career path ratio, and top performer retention rate. It emphasizes the need for effective data collection and analysis to drive strategic workforce planning and compensation practices, while addressing issues like pay equity and market underpayment. Practical advice is provided for monitoring these metrics to improve HR outcomes and enhance organizational performance.

1. 6 Cutting-Edge HR Metrics to
Measure in 2019
January 23, 2019

2. Agenda
1. People Analytics Maturity
2. Quality of Hire
3. Career Path Ratio
4. Top Performer Retention Rate
5. Comp Ratio
6. Range Penetration
7. Pay Equity
8. Q&A
9. SHRM / HRCI Codes

3. Presenters
Eric Knudsen
Manager of People
Analytics, Namely
Rita Patterson
Sr. Manager of Product
Implementation, PayScale

4. People Analytics Maturity

5. People Analytics Maturity Model
As companies mature, data
becomes increasingly important
to HR teams.
Many teams are taking steps to
make their talent practices more
analytics-driven.

6. What is People Analytics?

7. Data vs. Metrics vs. Analytics
People Analytics: Utilizing analytical process across the talent lifecycle
and leveraging data to drive strategic talent decisions.

8. The Talent Lifecycle We’ll Discuss Today
Finding
Talent
Accelerating
Talent
Retaining
Talent
Compensation & Pay Equity

9. Finding Talent

10. Better Hiring Data Allows Us To...
● Identify and hire top talent
● Understand the efficacy and objectivity of
the hiring process
● Facilitate an understanding about which
sources yield top and diverse talent
KEY METRIC:
Quality of Hire

11. Building a Quality of Hire Metric
1. Identify the critical components of your
quality of hire metric.
2. Build process to collect data for each
one.
3. Measure at the individual level, combine
for the organizational level.
Average of
Performance + Productivity
+
Job Fit + Values Fit

12. Sample Quality of Hire Survey
1. This person has reached or exceeded the level of productivity
expected after this long on the job.
(Strongly disagree - Strongly agree)
2. How would you rate the overall fit between your new hire's
competencies and the job requirements?
(No fit - Perfect fit)
3. How would you rate your new hire's fit with our values
overall? (No fit - Perfect fit)
4. If this person was interviewing again, I would re-hire him/her as
a bar raiser (i.e., performing greater than 50% of current
employees).
(Not at all - Absolutely)

13. How to Use Quality of Hire
SEND OUT QoH SURVEYS
At your decided
cadence, send out your
Quality of Hire Survey
to managers of new
hires who have hit their
6-8 week mark.
EXPORT & ANALYZE
Open your survey data
and average your
component scores. Then
calculate your rolled up
metric.
TRACK QoH OVER TIME
Track and actively
monitor trends in QoH
across the organization
and departments.
Partner with Recruiting
to action plan.

14. Accelerating Talent

15. Better Career Data Allows Us To...
● Supplement strategic workforce planning
efforts.
● Anticipate the changing shape of your
organization.
● Facilitate tailored employee career
growth.
KEY METRIC:
Career Path Ratio

16. Building a Career Path Ratio
1. Ensure you have Job Levels available
and coded in your HRIS (Associate,
Manager, Directors, etc.).
2. Define what constitutes a “promotion”
versus “lateral move”.

17. How to Use Career Path Ratio
EXPORT JOB HISTORY
Export a job (or title) history
report from your HRIS.
Ensure data is clean (reflect
true position changes rather
than title tweaks).
CLASSIFY LATERALS
AND PROMOTIONS
By observing whether or not
a change occurred between
or within job levels, you can
determine the frequency and
types of employee
movement.
MONITOR YOUR SPIRAL
STAIRCASE
By monitoring the trend in
Career Path Ratio between
reporting periods, you can
use it to inform your
workforce planning strategy

18. Retaining Talent

19. Better Retention Data Allows Us To...
● Target efforts to engage and retain top
talent.
● Inform HR planning efforts (workforce
planning, compensation, development).
● Balance focus between who’s leaving
and who’s staying.
KEY METRIC:
Top Performer Retention
Rate

20. Calculating Top Performer Retention
1. Define what it means to be a “top
performer” in your organization.
2. Establish company and department
baselines for top performer retention.
3. Equip managers with retention date, and
help facilitate discussion.
Promotions
Promotions + Laterals

21. How to Use Top Performer Retention
GATHER PERFORMANCE
AND TERMINATION DATA
Be sure to include Start and
Termination date fields, as
well as any segments of
interest (department).
Supplement with start-of-
period performance ratings.
COMPARE OVERALL &
TOP PERF. RETENTION
Calculate company-wide
retention, then filter to top
performers and re-calculate.
Compare these numbers to
identify gaps in retention
strategy.
USE RETENTION AS A
WARNING SYSTEM
If top performers have lower
or declining retention, drill
down for insight. Act fast,
but thoughtfully and
meaningfully.

22. Compensation Metrics

23. Pay Attention To...
Use compensation metrics to detect pay issues before they become
more serious.
● Pay Compression: When pay for two different levels of a same or
similar job is ‘compressed’.
● Market Underpayment: When an employee is underpaid relative to
the market.
● Flight Risks: Underpaid high performers
● Pay Disparity: When two people in the same job or very similar jobs
have large variance in pay.

24. Pay Compression
Pay Compression:
When there are small differences in pay for differing levels of a job.
WHAT CAUSES IT
● The market rate for a job has
moved significantly, and new hires
are coming in at high or similar rate
to tenured employees.
● The pay differential for varying
levels of a job is minimal and/or not
adhered to.
HOW TO AVOID IT
● Monitor market movement for all
jobs and adjust pay ranges
accordingly -- regularly.
● Review internal pay ranges
regularly and ensure that pay
ranges for leveled jobs overlap.

25. Market Underpayment
● Define your “competitive” set (location, industry, org type and org
size).
● Benchmark your jobs to other similar roles in the market to identify the
“going rate” for a position.
● Create pay ranges based on market rate & internal value of a role.
● Align pay for all employees in the same or similar job within the
market base pay range.
To avoid market underpayment, regularly benchmark your
positions to the market.

26. Flight Risks
WHAT CAUSES IT
Most commonly occurs when the rate of
increased performance or proficiency is
steeper than the rate of pay evaluation.
HOW TO AVOID IT
Review performance & position in range
regularly to avoid flight risks.
Flight Risks:
Employees who are high performers and low in range

27. Comp Ratio and Range
Penetration

28. Measuring Position in Range
Employee’s current salary
The current mid point of the
internal pay range
(Employee salary - range min.)
(Range max. - range min.)

29. Comp Ratio

30. Comp Ratio by Job Family

31. Range Penetration

32. How to Use Comp Ratio and Range Penetration
PICK ONE METRIC AND
CREATE FAMILIARITY
AROUND IT
Range penetration is going to land
more simply with managers &
employees.
Stick with comp ratio if its how your
finance & comp teams regularly talk
about it.
HAVE GUIDELINES FOR
HOW TO MOVE
EMPLOYEES THROUGH
THE RANGE
Be realistic about the financial
implications of these
guidelines.
EMPLOYEES LOW AND
HIGH IN RANGE
Evaluate whether this is
indicative of pay inequality, or
relevant based on the employee’s
tenure or performance.
Confirm and acknowledge the
reasoning for their higher pay.

33. Pay Equity

34. Pay Equity Can Make (Or Break) Your Brand

35. Pay Disparity
THINGS TO CONSIDER:
● Is the variance of pay reasonable?
○ Are tenure, performance, or other factors tied to pay
differences?
● Are these employees really in the same job?
○ Is one more senior than the other?
○ Is one in a newly created role that needs to be defined and
benchmarked?
Pay Disparity:
When two people in the same job or very similar jobs have large
variance in pay.

36. Conducting Pay Equity Analysis
IDENTIFY GAPS IN PAY
Identify pay gaps hidden
within certain job titles or
departments.
Identify underpaid high
performers and overpaid low
performers.
ASSESS SIGNIFICANT
DIFFERENCES
Take a look at major
differences in promotion
rates, raise frequencies,
amounts, and/or bonus
eligibility for similar
employees doing similar
work.
REVIEW THE GENDER
GAP
Review men and women
who do similar work at
different levels or pay rates.

37. Gender Equity Report

38. Job Group Gender Equity Report

39. Communicating Pay
Share compensation reports with employees to facilitate open and honest conversations about
pay and career trajectory.

40. Compensation Metric Use Cases
● Define & follow compensation strategies, practices & policies.
● Ensure fair pay within defined practices.
● See how your comp plan compares to the market.
● Identify over/underpaid employees.
● Uncover potential pay disparities.
● Create transparency & trust around pay communication.

41. Practical Advice & Considerations
● Track QoH over time using surveys.
● Study career paths to inform your workforce planning strategy.
● Monitor employee retention as a warning system.
● Start with the market -- don’t rely on it to make all decisions for you.
● Use compensation metrics to detect issues early.
● Conduct your pay equity analysis ahead of budgeting season.
○ Involve your legal team every step of the way.

42. NAMELY QUARTERLY
UPDATE

43. NAMELY QUARTERLY
UPDATE
Questions