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HR Metrics: Turnover Rate

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Honestly, I could really care less about turnover rate the way most organizations calculate it.  Sure, it informs me a little bit regarding the employer brand, and perhaps about the organization’s competitiveness against the market, but overall, turnover can be used much more effectively.  Most turnover reports consist of organizational and departmental turnover with terminations and sometimes losses due to internal transfers.  There are other nuances, but all in all, turnover is relatively boring.

What I personally like to see with turnover requires multi-dimensional analytics and a data warehouse.  I’d like to see turnover by top producers, senior talent and leadership.  I’d also like to see turnover among “protected classes” like gender and race.  Once I have turnover for these (and more) populations, I want to be able to rend across and 3 to 5 year time horizon, and drill through by my divisions and departments.  Basically what I’m saying is that turnover at the enterprise level is not helpful.  To really understand turnover and the impact at your organization, you need to drill down into the detail of specific populations that are mission critical.

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2 responses to “HR Metrics: Turnover Rate”

  1. Akash Avatar

    It is true that turnover data at organization level by itself would not reveal much, and there are numerous ways in which this metric can be used. It is also interesting to observe the corelation between the attrition and the performance of the business during different economic enviornment. It has been observed in my company that during robust economic condition, the high growth business unit would have a lower attrition rate in comparison to the low growth or a negative growth business unit. This trend is reversed during a recession.

    Besides calculating attrition, the cost of attrition should be calculated, this converts the attrition number to a value in currency, more appreciated by the business managers.

    In my opinion, the most important analysis during attrition analysis is the “Reason for Attrition” and then linking the reasons to the other HR metrics, in order to prove the point you are trying to drive.

    HR metrics are like body language, they need to be analyzed together with a lot of other metrics, to make some meaningful conclusion. Hope this helps.

  2. […] HR Metrics: Turnover Rate Article Series HR Metrics: Offer Accept Rate HR Metrics: Quality of Hire HR Metrics: Competency fill rates HR Metrics: External recruitment rate HR Metrics: Contractor fill rates HR Metrics: Turnover Rate Honestly, I could really care less about turnover rate the way most organizations calculate it. Systematic HR – Wednesday, February 18, 2009 READ MORE […]