Hi I need to know what the difference between these are - Key Performance Area / Key Performance Indicator / Key Result area
From Namibia, Windhoek
6From Namibia, Windhoek
Key Result Areas
“Key Result Areas” or KRAs refer to general areas of outcomes or outputs for which the department's role is responsible. A typical role targets three to five KRA.
Value of KRAs.
Identifying KRAs helps individuals: · Clarify their roles · Align their roles to the organisation’s business or strategic plan · Focus on results rather than activities · Communicate their role’s purposes to others · Set goals and objectives · Prioritize their activities, and therefore improve their time/work management · Make value-added decisions
Description of KRAs
Key result areas (KRAs) capture about 80% of the department's work role. The remainder of the role is usually devoted to areas of shared responsibility (e.g., helping team members, participating in activities for the good of the organisation).
================================================== ================
CORE KRAs of HR DEPARTMENT
-RECRUITMENT/ SELECTION
-WORKFORCE PLANNING/
-DIVERSITY MANAGEMENT
-PERFORMANCE MANAGEMENT
-REWARD MANAGEMENT
-WORKPLACE MANAGEMENT
-INDUSTRIAL RELATIONS
-SAFETY AND HEALTH WORKPLACE
-BUILDING CAPABILITIES AND ORGANIZATION LEARNING
-EFFECTIVE HR MANAGEMENT SYSTEMS , SUPPORT AND MONITORING
============================================-=======
KRAs [ KEY RESULT AREAS are managed by
-KPAs [ KEY PERFORMANCE AREAS]
-KPIs [KEY PERFORMANCE INDICATORS]
===================================
KEY PERFORMANCE AREAS
These are the areas within the HR DEPARTMENT, where an
individual or group, is logically responsible / accountable
for the results.
To manage each KRA/ KPAs, a set of KPI are set .
KRA and hence KPI is attributed to the department which
can have effect on the business results and is
self measured where applicable.
THE IMPORTANCE AND WEIGHTAGE OF THESE ELEMENTS
KRAs/KPAs/ KPIs ARE GUIDED BY THE
*VISION STATEMENT
*MISSION STATEMENT
*CORPORATE OBJECTIVES
*CORPORATE STRATEGY
*CORPORATE BUSINESS UNITS/ DEPARTMENTAL PLANS/STRATEGY.
FOR THE BUDGET PERIOD, WHICH IS USUALLY 12 MONTHS.
================================================== ======
HERE IS AN EXAMPLE, WHICH YOU CAN USE TO DEVELOP
OTHERS FOR YOUR ORGANIZATION.
CORPORATE OBJECTIVE / STRATEGY
-improve the company competitive positioning and productivity
by 10%.
HR DEPARTMENT'S OBJECTIVE
-Achieve high productivity level in all activities [ say by 10%]
-------------------------------------------------------
KRA 1
-RECRUITMENT/ SELECTION
KPA --RECRUITMENT
KPI ----reduce average time taken to fill vacancies by 15%
KPI ----reduce average cost per recruit by 10%
-------------------------------------------
KRA 2
-WORKPLACE MANAGEMENT
KPA -labour turnover
KPI ---reduce the labor turnover by 20%
KPI ----benchmark total HR COSTS externally.
------------------------------------------------
KRA 3
-SAFETY AND HEALTH WORKPLACE
KPA ---workplace accidents
KPI ----reduce workplace accidents by 10%
---------------------------------------------
KRA 4
-BUILDING CAPABILITIES AND ORGANIZATION LEARNING
KPA ----TRAINING
KPI --- ALL WORKFORCE below middle management should
receive a minimum of 4 days of training.
=========================================
THIS IS , ROUGHLY, HOW HR DEPARTMENTS
KRAs / KPAs / KPIs ARE SET , MONITORED AND
EVALUATED.
THIS CAN BE APPLIED TO ALL OTHER FUNCTIONAL
DEPARTMENTS LIKE MARKETING / SALES / PRODUCTION ETC.
regards
LEO LINGHAM
From India, Mumbai
“Key Result Areas” or KRAs refer to general areas of outcomes or outputs for which the department's role is responsible. A typical role targets three to five KRA.
Value of KRAs.
Identifying KRAs helps individuals: · Clarify their roles · Align their roles to the organisation’s business or strategic plan · Focus on results rather than activities · Communicate their role’s purposes to others · Set goals and objectives · Prioritize their activities, and therefore improve their time/work management · Make value-added decisions
Description of KRAs
Key result areas (KRAs) capture about 80% of the department's work role. The remainder of the role is usually devoted to areas of shared responsibility (e.g., helping team members, participating in activities for the good of the organisation).
================================================== ================
CORE KRAs of HR DEPARTMENT
-RECRUITMENT/ SELECTION
-WORKFORCE PLANNING/
-DIVERSITY MANAGEMENT
-PERFORMANCE MANAGEMENT
-REWARD MANAGEMENT
-WORKPLACE MANAGEMENT
-INDUSTRIAL RELATIONS
-SAFETY AND HEALTH WORKPLACE
-BUILDING CAPABILITIES AND ORGANIZATION LEARNING
-EFFECTIVE HR MANAGEMENT SYSTEMS , SUPPORT AND MONITORING
============================================-=======
KRAs [ KEY RESULT AREAS are managed by
-KPAs [ KEY PERFORMANCE AREAS]
-KPIs [KEY PERFORMANCE INDICATORS]
===================================
KEY PERFORMANCE AREAS
These are the areas within the HR DEPARTMENT, where an
individual or group, is logically responsible / accountable
for the results.
To manage each KRA/ KPAs, a set of KPI are set .
KRA and hence KPI is attributed to the department which
can have effect on the business results and is
self measured where applicable.
THE IMPORTANCE AND WEIGHTAGE OF THESE ELEMENTS
KRAs/KPAs/ KPIs ARE GUIDED BY THE
*VISION STATEMENT
*MISSION STATEMENT
*CORPORATE OBJECTIVES
*CORPORATE STRATEGY
*CORPORATE BUSINESS UNITS/ DEPARTMENTAL PLANS/STRATEGY.
FOR THE BUDGET PERIOD, WHICH IS USUALLY 12 MONTHS.
================================================== ======
HERE IS AN EXAMPLE, WHICH YOU CAN USE TO DEVELOP
OTHERS FOR YOUR ORGANIZATION.
CORPORATE OBJECTIVE / STRATEGY
-improve the company competitive positioning and productivity
by 10%.
HR DEPARTMENT'S OBJECTIVE
-Achieve high productivity level in all activities [ say by 10%]
-------------------------------------------------------
KRA 1
-RECRUITMENT/ SELECTION
KPA --RECRUITMENT
KPI ----reduce average time taken to fill vacancies by 15%
KPI ----reduce average cost per recruit by 10%
-------------------------------------------
KRA 2
-WORKPLACE MANAGEMENT
KPA -labour turnover
KPI ---reduce the labor turnover by 20%
KPI ----benchmark total HR COSTS externally.
------------------------------------------------
KRA 3
-SAFETY AND HEALTH WORKPLACE
KPA ---workplace accidents
KPI ----reduce workplace accidents by 10%
---------------------------------------------
KRA 4
-BUILDING CAPABILITIES AND ORGANIZATION LEARNING
KPA ----TRAINING
KPI --- ALL WORKFORCE below middle management should
receive a minimum of 4 days of training.
=========================================
THIS IS , ROUGHLY, HOW HR DEPARTMENTS
KRAs / KPAs / KPIs ARE SET , MONITORED AND
EVALUATED.
THIS CAN BE APPLIED TO ALL OTHER FUNCTIONAL
DEPARTMENTS LIKE MARKETING / SALES / PRODUCTION ETC.
regards
LEO LINGHAM
From India, Mumbai
Hi Very gud detailed information provided. Very well explained. I’m sure lot many HR professionals will gain from it. Rgds
From India, Gurgaon
From India, Gurgaon
:) hey Mr. Leo...
full detailed explanation.. i guess tht answers the ques.. actually i am in the process of designing JD.. including KRA< KPA, KPI for doctors and faculty members (i work in a teaching hospital).. so it was of great help to me.. thanks
From India, Guwahati
full detailed explanation.. i guess tht answers the ques.. actually i am in the process of designing JD.. including KRA< KPA, KPI for doctors and faculty members (i work in a teaching hospital).. so it was of great help to me.. thanks
From India, Guwahati
These are two different terminology used to cul out the macro level of outcomes of jobs. These are used based on individuals experience and preference of words.
KPI - stands for Key Performance Indicators
KRA - stands for Key Result Area
Both serves the same purpose. It comprises of following :
Major outcomes of a job handled by an individual
Measurement Unit and Criteria
Time Line
Linkages to other department
Hope this clarifies your query.
Regards
K Narayan
From India, Pune
KPI - stands for Key Performance Indicators
KRA - stands for Key Result Area
Both serves the same purpose. It comprises of following :
Major outcomes of a job handled by an individual
Measurement Unit and Criteria
Time Line
Linkages to other department
Hope this clarifies your query.
Regards
K Narayan
From India, Pune
This in an Information shared by a Member of CHR before.. which help you understand KPIs and KRAs....
His name is Mr. Leo....
You can thank him for the information....
Key Result Areas
“Key Result Areas” or KRAs refer to general areas of outcomes or outputs for which the department's role is responsible. A typical role targets three to five KRA.
Value of KRAs.
Identifying KRAs helps individuals: • Clarify their roles • Align their roles to the organisation’s business or strategic plan • Focus on results rather than activities • Communicate their role’s purposes to others • Set goals and objectives • Prioritize their activities, and therefore improve their time/work management • Make value-added decisions
Description of KRAs
Key result areas (KRAs) capture about 80% of the department's work role. The remainder of the role is usually devoted to areas of shared responsibility (e.g., helping team members, participating in activities for the good of the organisation).
================================================== =============== =
CORE KRAs of HR DEPARTMENT
-RECRUITMENT/ SELECTION
-WORKFORCE PLANNING/
-DIVERSITY MANAGEMENT
-PERFORMANCE MANAGEMENT
-REWARD MANAGEMENT
-WORKPLACE MANAGEMENT
-INDUSTRIAL RELATIONS
-SAFETY AND HEALTH WORKPLACE
-BUILDING CAPABILITIES AND ORGANIZATION LEARNING
-EFFECTIVE HR MANAGEMENT SYSTEMS , SUPPORT AND MONITORING
============================================-=======
KRAs [ KEY RESULT AREAS are managed by
-KPAs [ KEY PERFORMANCE AREAS]
-KPIs [KEY PERFORMANCE INDICATORS]
===================================
KEY PERFORMANCE AREAS
These are the areas within the HR DEPARTMENT, where an
individual or group, is logically responsible / accountable
for the results.
To manage each KRA/ KPAs, a set of KPI are set .
KRA and hence KPI is attributed to the department which
can have effect on the business results and is
self measured where applicable.
THE IMPORTANCE AND WEIGHTAGE OF THESE ELEMENTS
KRAs/KPAs/ KPIs ARE GUIDED BY THE
*VISION STATEMENT
*MISSION STATEMENT
*CORPORATE OBJECTIVES
*CORPORATE STRATEGY
*CORPORATE BUSINESS UNITS/ DEPARTMENTAL PLANS/STRATEGY.
FOR THE BUDGET PERIOD, WHICH IS USUALLY 12 MONTHS.
================================================== ======
HERE IS AN EXAMPLE, WHICH YOU CAN USE TO DEVELOP
OTHERS FOR YOUR ORGANIZATION.
CORPORATE OBJECTIVE / STRATEGY
-improve the company competitive positioning and productivity
by 10%.
HR DEPARTMENT'S OBJECTIVE
-Achieve high productivity level in all activities [ say by 10%]
-------------------------------------------------------
KRA 1
-RECRUITMENT/ SELECTION
KPA --RECRUITMENT
KPI ----reduce average time taken to fill vacancies by 15%
KPI ----reduce average cost per recruit by 10%
-------------------------------------------
KRA 2
-WORKPLACE MANAGEMENT
KPA -labour turnover
KPI ---reduce the labor turnover by 20%
KPI ----benchmark total HR COSTS externally.
------------------------------------------------
KRA 3
-SAFETY AND HEALTH WORKPLACE
KPA ---workplace accidents
KPI ----reduce workplace accidents by 10%
---------------------------------------------
KRA 4
-BUILDING CAPABILITIES AND ORGANIZATION LEARNING
KPA ----TRAINING
KPI --- ALL WORKFORCE below middle management should
receive a minimum of 4 days of training.
=========================================
THIS IS , ROUGHLY, HOW HR DEPARTMENTS
KRAs / KPAs / KPIs ARE SET , MONITORED AND
EVALUATED.
THIS CAN BE APPLIED TO ALL OTHER FUNCTIONAL
DEPARTMENTS LIKE MARKETING / SALES / PRODUCTION ETC.
THIS IS A BROAD GENERAL MIX, NOT TUNED TOWARDS
ANY PARTICULAR INDUSTRY OR ORGANIZATION.
MANAGER
LEARNING AND DEVELOPMENT
KRAs and KPIs.
KRA 1-deliver relevant and targeted programs to the
organization employees.
KPI 1--EMPLOYEE SATISFACTION FEEDBACK THROUGH SURVEY
SATISFACTION LEVEL MINIMUM 70%.
KPI 2--% INCREASE INCREASE IN TRAINING PROGRAMS
KPI 3--% INCREASE IN EMPLOYEE PARTICIPATION.
===============================================
KRA 2-promote the programs/learning culture
KPI 1--EMPLOYEE SATISFACTION FEEDBACK THROUGH SURVEY
SATISFACTION LEVEL MINIMUM 70%.
KPI 2--NUMBER OF DEPARTMENTS SATISFACTION LEVEL.
KPI 3--% INCREASE IN TYPES OF ACTIVITIES
===============================================
KRA 3-provide lead in the provision of
organization learning and development service
KPI 1--NO. OF TRAINING DAYS % INCREASE
KPI 2--NO. OF EMPLOYEES PARTICIPATING % INCREASE
KPI 3--NO. OF INHOUSE PROGRAMS % INCREASE
KPI 4--NO. OF EXTERNAL PROGRAMS ATTENDED %INCREASE.
KPI 5--NO. OF EXTERNAL TRAINING PACKAGES BOUGHT %INCREASE.
KPI 6--% INCREASE IN COST.
KPI 7--% INCREASE IN RESOURCE REQUIREMENTS.
================================================
KRA 4-improvements in capabilities/capacities
to deliver L&D.
KPI 1--PROGRAMS IMPLEMENTED ON TIME [ % ]
KPI 2--PROGRAMS IMPLEMENTED WITHIN BUDGET [ %]
KPI 3--EFFECTIVE USE OF PERFORMANCE MANAGEMENT
SYSTEM FOR DEVELOPMENT [ % ]
===============================================
==================================================
HR MANAGER
KEY RESULT AREAS.
KRA 1 Recruitment / Selection
KRA 2 Workforce Planning and Diversity
KRA 3 Performance Management
KRA 4 Reward Management
KRA 5 Workplace Management and Relations
KRA 6 A Safe and Healthy Workplace
KRA 7 Building Capabilities and Organisational Learning
KRA 8 Effective HR Management Systems, Support and Monitoring
================================================== =============== ===
For the management trainer, key result areas could be:
Design of solutions
Delivery of solutions
Evaluation of solutions
Budgets
Client satisfaction
Innovation
========================================
General Management or Senior Executive
KRAs include
Internal operations
Market development
Profitability
Organisational structure
Organisational vision and mission
Asset and liability management
Board of directors relationship
Productivity
Financial strategy
Business development
Technology
Customer satisfaction
Community relations
Regulatory compliance
=================================
Finance and Accounting
KRAs include
Credit referencing
Management information
Capital expenditure
Security
Financial analysis
Cost control
Internal audit
Regulatory reporting
Credit control
Financial records
Payroll
Cashflow forecasting
Budgeting
Costing
===================================
Sales
KRAs include
New business acquisition
Territory management
Customer care
Lead generation
Lead follow up (internal and external)
Account management
Customer retention
Interpersonal skills
Negotiating skills
Product knowledge
Sales forecasting
=====================================
Manufacturing
KRAs include
Stock control
Maintenance
Labour relations
Waste
Reworks
Productivity
Health and Safety
Quality control
Record keeping
======================================
Marketing
KRAs include
Advertising
Promotional strategy
Pricing
Market research
Field support
Marketing materials
Media relations
Sales support
Agency relations
======================================
Secretarial, Clerical and Administrative
KRAs include
Correspondence
Filing
Records management
Administrative support
Internal customer relations
Equipment maintenance
Forms administration
Scheduling
Supply maintenance and purchasing
Telephone coverage
Project support
Finally, key result areas for everyone in an organisation are:
Personal development
Professional development
Internal and external customer satisfaction
Public relations
Communication - oral and written
Interdepartmental relations
Project management
====================================
KPI FOR THE VARIOUS KRAs should be
-quantity oriented
-quality oriented
-time oriented
-cost oriented
or a combination .
Quantity
Number of units produced/published/sent/received/processed/deadlines
Calls per hour/day/week
New products introduced
Grievances per 100 employees
Staff turnover
Customer complaints and compliments
Error rate or reworks
Returned goods
Sales increased
Profit increased
Increase in market share
Cost
Variance against budget
£’s spent
Profit
Waste
Overtime incurred
Speed
Time
Reduction in number of minutes/hours/days etc.
Deadlines and schedules met
Average call response time
Projects completed per week/month etc.
Number of minutes between customers
Qualitative
Accuracy
Customer satisfaction
Repeat business
Mistakes
Reworks/repairs
Therefore:example
Key Result Area = Sales
Objective = Sell x new product to customers
KPI = Number of units sold per new customer whilst maintaining
gross profit level of 25%
ANOTHER IMPORTANT ARE IN BUSINESS IS
SUPPLY CHAIN MANAGEMENT
DEMAND PLANNING
-demand planning for core products
-demand planning for parts/accessories
-demand planning for critical items
-developing product life cycle trends
-product life cycle forecast for new products
etc
KPI could be
-remove stock shortages[ by %]
-improve inventory levels.[ 98% max]
etc
==================================
PROCUREMANT
-quicker stock replenishment
-continual stock replenishment
-reduction in lead time
etc
KPI could be
-improving stock availability [100%]
-reducing cost [ 5%]
-reduction working capital [ 7%]
etc
=======================================
SUPPLY
-better supply coordination
-more effective communication with supplier
-faster / timely communication
etc
KPI could be
-developing supplier profile [ all accounts]
-developing suppliers networking [ all accounts]
etc
===================================
RAW--INVENTORY
-quicker replenishment
-customer focused inventory building
-logistical lead time reduction
-demand based inventory
etc
KPI could be
-better material availability[100%]
-good/ usable inventory levels [ 98% satisfaction]
etc
=======================================
MANUFACTURING
-elimination of wastages in production
-improving throughput effiiciency
-process efficiency
etc
KPI could be
-reducing back orders[ nil %]
-improving targeted delivery date [ 98%]
etc
=================================
FINISHED --INVENTORY
-reduction in logical leadtime
-full stock availability
etc
KPI could be
-full total inventory[ 100%]
-full stock / range availability [ full range]
etc
=================================
ORDER SERVICE
-short--response time to query
-shortening order cycle time
etc
KPI could be
-making targeted delivery date [ 100%]
-providing order status [ at all times]
etc
==================================
DISTRIBUTION
-order fill rate
-ontime delivery
-backorder by age
-service/ parts availability
-targeted delivery date
-order completeness
-delivery reliability
etc
KPI could be
-improve order fill rate [ 98%]
-improve on-time delivery [ 98%]
-reduce shipment delays[ 0%]
etc
=============================
CUSTOMER SERVICE
-order status
-delivery reliabilitty
-documentation integrity
etc
KPI could be
-timely order status [ 100%]
-timely delivery status.[ 100%]
etc
================================================== =====
THE SUPPLY CHAIN MANAGEMENT KPIs
could include
-IMPROVING MATERIAL FLOWS
-REDUCE RAW MATERIAL INVENTORY LEVELS
-REDUCING PURCHASING COST
-REDUCE FREIGHT COST
-REDUCE OBSOLETE STOCK LEVELS
-IMPROVING WAREHOUSING OPERATIONS EFFICIENCY
-OPTIMISE STOCK LEVELS
-REDUCE LEAD TIME
-REDUCE TOTAL INVENTORY LEVELS
-REDUCE FINISHED STOCKS
-IMPROVE DEMAND FORECASTING
-IMPROVE MATERIAL RESOURCE PLANNING
================================================== ===
===================================
OTHER KPIs could be as follows
2.MANUFACTURING
- Unit volume level
- unit cost target
-production efficiency improvement
-productivity improvement
-quality improvement index
-capacity utilization
etc etc
==================================== MARKETING
-market share %
-new product launches success
-profit contribution by productlines
etc etc
=====================================
SALES
-sales against last year
-sales against target
-sales coverage improvement
etc etc
======================================
DISTRIBUTION
-market coverage
-customer coverage
-channel coverage
=======================================
CUSTOMER SERVICE
-CUSTOMER SERVICE IMPROVEMENT
-CUSTOMER SATISFACTION ACHIEVEMENT
ETC ETC
======================================
WAREHOUSING / TRANSPORTATION
-%ACHIEVED AGAINST ORDERS
-PICKING / PACKING RATE
-FINISHED GOODS INVENTORY LEVEL
-STOCK TURNOVER
====================================
FINANCE
-Cost of Capital USED
- Receivables leveL / against sales
-Bad debt level
-Debt equity ratio
=====================================
PROCUREMENT / SUPPLY
-raw material inventory levels
-cost saving target
From India, Mumbai
His name is Mr. Leo....
You can thank him for the information....
Key Result Areas
“Key Result Areas” or KRAs refer to general areas of outcomes or outputs for which the department's role is responsible. A typical role targets three to five KRA.
Value of KRAs.
Identifying KRAs helps individuals: • Clarify their roles • Align their roles to the organisation’s business or strategic plan • Focus on results rather than activities • Communicate their role’s purposes to others • Set goals and objectives • Prioritize their activities, and therefore improve their time/work management • Make value-added decisions
Description of KRAs
Key result areas (KRAs) capture about 80% of the department's work role. The remainder of the role is usually devoted to areas of shared responsibility (e.g., helping team members, participating in activities for the good of the organisation).
================================================== =============== =
CORE KRAs of HR DEPARTMENT
-RECRUITMENT/ SELECTION
-WORKFORCE PLANNING/
-DIVERSITY MANAGEMENT
-PERFORMANCE MANAGEMENT
-REWARD MANAGEMENT
-WORKPLACE MANAGEMENT
-INDUSTRIAL RELATIONS
-SAFETY AND HEALTH WORKPLACE
-BUILDING CAPABILITIES AND ORGANIZATION LEARNING
-EFFECTIVE HR MANAGEMENT SYSTEMS , SUPPORT AND MONITORING
============================================-=======
KRAs [ KEY RESULT AREAS are managed by
-KPAs [ KEY PERFORMANCE AREAS]
-KPIs [KEY PERFORMANCE INDICATORS]
===================================
KEY PERFORMANCE AREAS
These are the areas within the HR DEPARTMENT, where an
individual or group, is logically responsible / accountable
for the results.
To manage each KRA/ KPAs, a set of KPI are set .
KRA and hence KPI is attributed to the department which
can have effect on the business results and is
self measured where applicable.
THE IMPORTANCE AND WEIGHTAGE OF THESE ELEMENTS
KRAs/KPAs/ KPIs ARE GUIDED BY THE
*VISION STATEMENT
*MISSION STATEMENT
*CORPORATE OBJECTIVES
*CORPORATE STRATEGY
*CORPORATE BUSINESS UNITS/ DEPARTMENTAL PLANS/STRATEGY.
FOR THE BUDGET PERIOD, WHICH IS USUALLY 12 MONTHS.
================================================== ======
HERE IS AN EXAMPLE, WHICH YOU CAN USE TO DEVELOP
OTHERS FOR YOUR ORGANIZATION.
CORPORATE OBJECTIVE / STRATEGY
-improve the company competitive positioning and productivity
by 10%.
HR DEPARTMENT'S OBJECTIVE
-Achieve high productivity level in all activities [ say by 10%]
-------------------------------------------------------
KRA 1
-RECRUITMENT/ SELECTION
KPA --RECRUITMENT
KPI ----reduce average time taken to fill vacancies by 15%
KPI ----reduce average cost per recruit by 10%
-------------------------------------------
KRA 2
-WORKPLACE MANAGEMENT
KPA -labour turnover
KPI ---reduce the labor turnover by 20%
KPI ----benchmark total HR COSTS externally.
------------------------------------------------
KRA 3
-SAFETY AND HEALTH WORKPLACE
KPA ---workplace accidents
KPI ----reduce workplace accidents by 10%
---------------------------------------------
KRA 4
-BUILDING CAPABILITIES AND ORGANIZATION LEARNING
KPA ----TRAINING
KPI --- ALL WORKFORCE below middle management should
receive a minimum of 4 days of training.
=========================================
THIS IS , ROUGHLY, HOW HR DEPARTMENTS
KRAs / KPAs / KPIs ARE SET , MONITORED AND
EVALUATED.
THIS CAN BE APPLIED TO ALL OTHER FUNCTIONAL
DEPARTMENTS LIKE MARKETING / SALES / PRODUCTION ETC.
THIS IS A BROAD GENERAL MIX, NOT TUNED TOWARDS
ANY PARTICULAR INDUSTRY OR ORGANIZATION.
MANAGER
LEARNING AND DEVELOPMENT
KRAs and KPIs.
KRA 1-deliver relevant and targeted programs to the
organization employees.
KPI 1--EMPLOYEE SATISFACTION FEEDBACK THROUGH SURVEY
SATISFACTION LEVEL MINIMUM 70%.
KPI 2--% INCREASE INCREASE IN TRAINING PROGRAMS
KPI 3--% INCREASE IN EMPLOYEE PARTICIPATION.
===============================================
KRA 2-promote the programs/learning culture
KPI 1--EMPLOYEE SATISFACTION FEEDBACK THROUGH SURVEY
SATISFACTION LEVEL MINIMUM 70%.
KPI 2--NUMBER OF DEPARTMENTS SATISFACTION LEVEL.
KPI 3--% INCREASE IN TYPES OF ACTIVITIES
===============================================
KRA 3-provide lead in the provision of
organization learning and development service
KPI 1--NO. OF TRAINING DAYS % INCREASE
KPI 2--NO. OF EMPLOYEES PARTICIPATING % INCREASE
KPI 3--NO. OF INHOUSE PROGRAMS % INCREASE
KPI 4--NO. OF EXTERNAL PROGRAMS ATTENDED %INCREASE.
KPI 5--NO. OF EXTERNAL TRAINING PACKAGES BOUGHT %INCREASE.
KPI 6--% INCREASE IN COST.
KPI 7--% INCREASE IN RESOURCE REQUIREMENTS.
================================================
KRA 4-improvements in capabilities/capacities
to deliver L&D.
KPI 1--PROGRAMS IMPLEMENTED ON TIME [ % ]
KPI 2--PROGRAMS IMPLEMENTED WITHIN BUDGET [ %]
KPI 3--EFFECTIVE USE OF PERFORMANCE MANAGEMENT
SYSTEM FOR DEVELOPMENT [ % ]
===============================================
==================================================
HR MANAGER
KEY RESULT AREAS.
KRA 1 Recruitment / Selection
KRA 2 Workforce Planning and Diversity
KRA 3 Performance Management
KRA 4 Reward Management
KRA 5 Workplace Management and Relations
KRA 6 A Safe and Healthy Workplace
KRA 7 Building Capabilities and Organisational Learning
KRA 8 Effective HR Management Systems, Support and Monitoring
================================================== =============== ===
For the management trainer, key result areas could be:
Design of solutions
Delivery of solutions
Evaluation of solutions
Budgets
Client satisfaction
Innovation
========================================
General Management or Senior Executive
KRAs include
Internal operations
Market development
Profitability
Organisational structure
Organisational vision and mission
Asset and liability management
Board of directors relationship
Productivity
Financial strategy
Business development
Technology
Customer satisfaction
Community relations
Regulatory compliance
=================================
Finance and Accounting
KRAs include
Credit referencing
Management information
Capital expenditure
Security
Financial analysis
Cost control
Internal audit
Regulatory reporting
Credit control
Financial records
Payroll
Cashflow forecasting
Budgeting
Costing
===================================
Sales
KRAs include
New business acquisition
Territory management
Customer care
Lead generation
Lead follow up (internal and external)
Account management
Customer retention
Interpersonal skills
Negotiating skills
Product knowledge
Sales forecasting
=====================================
Manufacturing
KRAs include
Stock control
Maintenance
Labour relations
Waste
Reworks
Productivity
Health and Safety
Quality control
Record keeping
======================================
Marketing
KRAs include
Advertising
Promotional strategy
Pricing
Market research
Field support
Marketing materials
Media relations
Sales support
Agency relations
======================================
Secretarial, Clerical and Administrative
KRAs include
Correspondence
Filing
Records management
Administrative support
Internal customer relations
Equipment maintenance
Forms administration
Scheduling
Supply maintenance and purchasing
Telephone coverage
Project support
Finally, key result areas for everyone in an organisation are:
Personal development
Professional development
Internal and external customer satisfaction
Public relations
Communication - oral and written
Interdepartmental relations
Project management
====================================
KPI FOR THE VARIOUS KRAs should be
-quantity oriented
-quality oriented
-time oriented
-cost oriented
or a combination .
Quantity
Number of units produced/published/sent/received/processed/deadlines
Calls per hour/day/week
New products introduced
Grievances per 100 employees
Staff turnover
Customer complaints and compliments
Error rate or reworks
Returned goods
Sales increased
Profit increased
Increase in market share
Cost
Variance against budget
£’s spent
Profit
Waste
Overtime incurred
Speed
Time
Reduction in number of minutes/hours/days etc.
Deadlines and schedules met
Average call response time
Projects completed per week/month etc.
Number of minutes between customers
Qualitative
Accuracy
Customer satisfaction
Repeat business
Mistakes
Reworks/repairs
Therefore:example
Key Result Area = Sales
Objective = Sell x new product to customers
KPI = Number of units sold per new customer whilst maintaining
gross profit level of 25%
ANOTHER IMPORTANT ARE IN BUSINESS IS
SUPPLY CHAIN MANAGEMENT
DEMAND PLANNING
-demand planning for core products
-demand planning for parts/accessories
-demand planning for critical items
-developing product life cycle trends
-product life cycle forecast for new products
etc
KPI could be
-remove stock shortages[ by %]
-improve inventory levels.[ 98% max]
etc
==================================
PROCUREMANT
-quicker stock replenishment
-continual stock replenishment
-reduction in lead time
etc
KPI could be
-improving stock availability [100%]
-reducing cost [ 5%]
-reduction working capital [ 7%]
etc
=======================================
SUPPLY
-better supply coordination
-more effective communication with supplier
-faster / timely communication
etc
KPI could be
-developing supplier profile [ all accounts]
-developing suppliers networking [ all accounts]
etc
===================================
RAW--INVENTORY
-quicker replenishment
-customer focused inventory building
-logistical lead time reduction
-demand based inventory
etc
KPI could be
-better material availability[100%]
-good/ usable inventory levels [ 98% satisfaction]
etc
=======================================
MANUFACTURING
-elimination of wastages in production
-improving throughput effiiciency
-process efficiency
etc
KPI could be
-reducing back orders[ nil %]
-improving targeted delivery date [ 98%]
etc
=================================
FINISHED --INVENTORY
-reduction in logical leadtime
-full stock availability
etc
KPI could be
-full total inventory[ 100%]
-full stock / range availability [ full range]
etc
=================================
ORDER SERVICE
-short--response time to query
-shortening order cycle time
etc
KPI could be
-making targeted delivery date [ 100%]
-providing order status [ at all times]
etc
==================================
DISTRIBUTION
-order fill rate
-ontime delivery
-backorder by age
-service/ parts availability
-targeted delivery date
-order completeness
-delivery reliability
etc
KPI could be
-improve order fill rate [ 98%]
-improve on-time delivery [ 98%]
-reduce shipment delays[ 0%]
etc
=============================
CUSTOMER SERVICE
-order status
-delivery reliabilitty
-documentation integrity
etc
KPI could be
-timely order status [ 100%]
-timely delivery status.[ 100%]
etc
================================================== =====
THE SUPPLY CHAIN MANAGEMENT KPIs
could include
-IMPROVING MATERIAL FLOWS
-REDUCE RAW MATERIAL INVENTORY LEVELS
-REDUCING PURCHASING COST
-REDUCE FREIGHT COST
-REDUCE OBSOLETE STOCK LEVELS
-IMPROVING WAREHOUSING OPERATIONS EFFICIENCY
-OPTIMISE STOCK LEVELS
-REDUCE LEAD TIME
-REDUCE TOTAL INVENTORY LEVELS
-REDUCE FINISHED STOCKS
-IMPROVE DEMAND FORECASTING
-IMPROVE MATERIAL RESOURCE PLANNING
================================================== ===
===================================
OTHER KPIs could be as follows
2.MANUFACTURING
- Unit volume level
- unit cost target
-production efficiency improvement
-productivity improvement
-quality improvement index
-capacity utilization
etc etc
==================================== MARKETING
-market share %
-new product launches success
-profit contribution by productlines
etc etc
=====================================
SALES
-sales against last year
-sales against target
-sales coverage improvement
etc etc
======================================
DISTRIBUTION
-market coverage
-customer coverage
-channel coverage
=======================================
CUSTOMER SERVICE
-CUSTOMER SERVICE IMPROVEMENT
-CUSTOMER SATISFACTION ACHIEVEMENT
ETC ETC
======================================
WAREHOUSING / TRANSPORTATION
-%ACHIEVED AGAINST ORDERS
-PICKING / PACKING RATE
-FINISHED GOODS INVENTORY LEVEL
-STOCK TURNOVER
====================================
FINANCE
-Cost of Capital USED
- Receivables leveL / against sales
-Bad debt level
-Debt equity ratio
=====================================
PROCUREMENT / SUPPLY
-raw material inventory levels
-cost saving target
From India, Mumbai
Hi Leo!
Nice, detailed information!
wanted to add one thing.
KRAs and KPAs are the same thing, the only difference is like this-
In some cases, even if the employee does his best to achieve his KRA successfully, he may fail because of certain unavoidable circumstances, beyond his control. IF we go by KRA, he will not achieve results. But , if we go by KPA, he has performed. He should not be made to loose because of certain problems beyond his control.
take an example of a salesman in seeds industry. If the region is flooded, he will not be able to reach targets of selling seeds. but, this does not mean that he will be considered a poor performer.
because of this, the inclination is shifting from KRAs to KPAs.
Regards,
Ashwini Kumar
From India, Hyderabad
Nice, detailed information!
wanted to add one thing.
KRAs and KPAs are the same thing, the only difference is like this-
In some cases, even if the employee does his best to achieve his KRA successfully, he may fail because of certain unavoidable circumstances, beyond his control. IF we go by KRA, he will not achieve results. But , if we go by KPA, he has performed. He should not be made to loose because of certain problems beyond his control.
take an example of a salesman in seeds industry. If the region is flooded, he will not be able to reach targets of selling seeds. but, this does not mean that he will be considered a poor performer.
because of this, the inclination is shifting from KRAs to KPAs.
Regards,
Ashwini Kumar
From India, Hyderabad
Sunitha
AS the first step to build KRAs for HR,
YOU must visit
YOUR COMPANY'S
*VISION STATEMENT
*MISSION STATEMENT
*CORPORATE OBJECTIVES
*CORPORATE STRATEGY
*CORPORATE BUSINESS UNITS/ DEPARTMENTAL PLANS/STRATEGY.
AND COULD CHANGE YEAR BY YEAR AS PER THE BOARD DIRECTIVES.
-------------------------------------------------------------------------------
Then review your own job description.
-------------------------------------------------------------------------------
UNDERSTAND THAT THE ,
KRA AND KPA
Key Result Areas
“Key Result Areas” or KRAs refer to general areas of outcomes or outputs for which a role is responsible. A typical role targets three to five KRA.
------------------------------------------
Value
Identifying KRAs helps individuals: · Clarify their roles · Align their roles to the organisation’s business or strategic plan · Focus on results rather than activities · Communicate their role’s purposes to others · Set goals and objectives · Prioritize their activities, and therefore improve their time/work management · Make value-added decisions
---------------------------------------------------
Description
Key result areas (KRAs) capture about 80% of a work role. The remainder of the role is usually devoted to areas of shared responsibility (e.g., helping team members, participating in activities for the griptionood of the organisation).
-----------------------------------------------------------
EXAMPLE
HR [ KRAs]
CORE KRAs
-RECRUITMENT/ SELECTION
-WORKFORCE PLANNING/ DIVERSITY
-PERFORMANCE MANAGEMENT
-REWARD MANAGEMENT
-WORKPLACE MANAGEMENT AND RELATIONS
-SAFETY AND HEALTH WORKPLACE
-BUILDING CAPABILITIES AND ORGANIZATION LEARNING
-EFFECTIVE HR MANAGEMENT SYSTEMS , SUPPORT AND MONITORING
----------------------------------------------------------------
KEY PERFORMANCE AREAS [ KPA ]
These are the areas within the ORGANIZATION FUNCTIONS, where an
individual or group, is logically responsible / accountable
for the results.
To manage each KRA, a set of KPA / KPI are set .
KPA and hence KPI is attributed to the person who
can have effect on the business results and is
self measured where applicable
EXAMPLE OF HR
KRA = RECRUITMENT / SELECTION
KPA 1 = RECRUITMENT
KPA 2= SELECTION
KPi for KPA 1= reduce the recruitment cost per head by 10%.
KPi for KPA 2 = finalize selection in 5 weeks for each individual position.
--------------------------------------------------------------
.THE CHOICE OF HR KPI WILL VARY FROM YEAR TO YEAR,
SUBJECT TO COMPANY'S
-STRATEGIC PLANNING
-CORPORATE STRATEGIES
-CORPORATE OBJECTIVES
WHICH IN TURN AFFECTS THE HR'S
-HR STRATEGIC PLANNING
-HRM STRATEGIES
-HRM OBJECTIVES
-------------------------------------------------------
The HR Balanced Scorecard is the measurement tool. It provides the management with a tool and a process to measure the performance of people practices and the HR function from multiple perspectives:
1. Strategic Perspective — the results of strategic initiatives managed by the HR group. The strategic perspective focuses on the measurement of the effectiveness of major strategy-linked people goals. For instance, the business strategy called for major organizational change programs as the business faced major restructuring and multiple mergers and acquisitions. In this context, the organization’s change management capability will be a key factor in the success or failure of its execution. Therefore, measuring the ability of the business to manage change effectively is the core measure of the effectiveness of HR and will be a key strategic contribution to the future success of the business.
EXAMPLES
-change management capability of the organization
-organization compensation and benefit package with respect market rate.
-organization culture survey
-HR BUDGET / ACTUAL
-HR COSTS BENCHMARK EXTERNALLY
-HR annual resource plan.
-skills/ competency level
etc
2.Operational Perspective — the operational tasks at which HR must excel. This piece of the Balanced Scorecard provides answers to queries about the effectiveness and efficiency in running HR processes that are vital to the organization. Examples include measuring HR processes in terms of cost, quality and cycle time such as time to fill vacancies.
EXAMPLES
-time taken to fill vacancies
-cost per recruitment promotions
-absenteeism by job category
-accident costs
-accident safety ratings
-training cost per employee
-training hours per employee
-average employee tenure in the company
-lost time due to injuries
-no. of recruiting advertising programs
-no. of employees put through training.
-turnover rate
-attrition rate
etc
3.Financial Perspective — this perspective tries to answer questions relating to the financial measures that demonstrate how people and the HR function add value to the organization. This might include arriving at the value of the human assets and total people expenses for the company. HR
EXAMPLES
-compensation and benefits per employee
-sales per employee
-profit per employee
-cost of injuries
-HR expenses per employee
-turnove cost
-employee '' workers compensation costs''
etc
4.Customer Perspective — this focuses on the effectiveness of HR from the internal customer viewpoint. Are the customers of HR satisfied with their service; are service level agreements met; do the customers think they can get better service elsewhere? Conducting an HR customer survey might typically arrive at this.
EXAMPLES
-employee perception of the HRM
-employee perception of the company , as an employer
-customer/market perception of the company, as an employer.
etc
All four components of the scorecard are used to define and measure the effectiveness of people-management activities and how the HR function executes them. This provides a strategic measurement and management process to show the connection between a company’s business strategies and goals and its HR strategies, activities, and results. The Balanced Scorecard can provide an ideal approach to measure the contribution that human resource management makes to business success.
With the HR Balanced Scorecard in place, it can assist organizations to easily monitor the workforce indicators that are key to their business success. Such solutions enhance HR’s ability to provide counsel to line management and deliver results that make a difference to the achievement of their goals and strategy and thereby to shareholders.
The apparent and inherent values that the HR Balanced Scorecard brings include:
Measurement provides the data and facts to support business decisions, giving credibility to HR recommendations and initiatives;
Collecting and using data to make decisionsregarding retaining and motivating the
workforce, giving the organization a competitive advantage in the marketplace;
The right mix of lead and lag measures helps the business assess its strategic
alignment and progress towards its objectives;
HR will be proactive in identifying potential improvements and bringing suggestions
to the business that improve bottom-line results; and
A business and linked measurement framework focuses activity on those tasks
that contribute to organizational success. This process lifts the role of HR from being viewed purely as a cost centre to that as strategic business partner.
================================================== ===============
HR Key Performance Indicators
Frequently used HR Key Performance Indicators include:
[[ FTE = full time employees ]]
Revenue per Employee (FTE)
Assets per FTE
Training Hours per FTE
Training Costs per FTE
HR Department Cost per FTE
FTEs per HR Department FTE
Acceptance Rate
Average Cost per Hire
Absence Rate
Turnover Rate
Resignation Rate
Human Investment Ratio
Compensation & Benefits/Revenue
Average Remuneration
Time taken per recruitment
Cost per recruitment
============================================
EXAMPLES of KRAs / KPAs / KPIs
KRA 1 -RECRUITMENT/ SELECTION
KPA 1- RECRUITMENT [KPI= average time taken per employee 2 months]
KPA 2 -SELECTION [ KPI = average cost per new employee RS 10,000]
====================================
KRA 2 - WORKFORCE PLANNING/ DIVERSITY
KPA 1 - ANSENTEEISM [ KPI = absent rate at 5%]
KPA 2- TURNOVER [ KPI = turnover rate at 7%]
KPA 3- DIVERSITY [ KPI = 3 FEMALES TO BE INDUCTED INTO MANAGEMENT CADRE]
=====================================
KRA 3- PERFORMANCE MANAGEMENT
KPA 1 - PERFORMANCE APPRAISALS [KPI = all staff to be appraised at least once annually]
KPA 2 -SUCCESSION PLANNING [ KPI = 8 POTENTAL staff to be identified and talent managed]
===================================
KRA 4 - REWARD MANAGEMENT
KPA 1- MARKET ORIENTED SALARY STRUCTURING [ KPI = total compensation to sales 12%]
KPA 2 -BENEFITS PLANNING [ KPI = 6% of total salary bill]
============================================
KRA 5 - WORKPLACE MANAGEMENT AND RELATIONS
KPA 1 -JOB EVALUATIONS [ KPI = 600 lower staff , below grade 4 to be evaluated]
KPA 2 - EMPLOYEE COMMUNICATIONS [ KPI = 4 newsletter on intranet,one per quarter ]
===========================================
KRA 6 - SAFETY AND HEALTH WORKPLACE
KPA 1 - SAFETY [ KPI = accident safety ratings, benchmark with industry]
KPA 2 - HEALTH [KPI = actual health expenditure vs budget ]
========================================
KRA 7 - BUILDING CAPABILITIES AND ORGANIZATION LEARNING
KPA 1 - TRAINING [ KPI = average training hours per employee annually= 24 hours]
KPA 2 - MANAGEMENT DEVELOPMENT [ KPI =average MD cost per employee annually= 16000 RS]
============================================
KRA 8 - EFFECTIVE HR MANAGEMENT SYSTEMS , SUPPORT AND MONITORING
KPA 1- HRIS [ KPI = finalize the software . RS 1.2 million capital budget]
regards
LEO LINGHAM
From India, Mumbai
AS the first step to build KRAs for HR,
YOU must visit
YOUR COMPANY'S
*VISION STATEMENT
*MISSION STATEMENT
*CORPORATE OBJECTIVES
*CORPORATE STRATEGY
*CORPORATE BUSINESS UNITS/ DEPARTMENTAL PLANS/STRATEGY.
AND COULD CHANGE YEAR BY YEAR AS PER THE BOARD DIRECTIVES.
-------------------------------------------------------------------------------
Then review your own job description.
-------------------------------------------------------------------------------
UNDERSTAND THAT THE ,
KRA AND KPA
Key Result Areas
“Key Result Areas” or KRAs refer to general areas of outcomes or outputs for which a role is responsible. A typical role targets three to five KRA.
------------------------------------------
Value
Identifying KRAs helps individuals: · Clarify their roles · Align their roles to the organisation’s business or strategic plan · Focus on results rather than activities · Communicate their role’s purposes to others · Set goals and objectives · Prioritize their activities, and therefore improve their time/work management · Make value-added decisions
---------------------------------------------------
Description
Key result areas (KRAs) capture about 80% of a work role. The remainder of the role is usually devoted to areas of shared responsibility (e.g., helping team members, participating in activities for the griptionood of the organisation).
-----------------------------------------------------------
EXAMPLE
HR [ KRAs]
CORE KRAs
-RECRUITMENT/ SELECTION
-WORKFORCE PLANNING/ DIVERSITY
-PERFORMANCE MANAGEMENT
-REWARD MANAGEMENT
-WORKPLACE MANAGEMENT AND RELATIONS
-SAFETY AND HEALTH WORKPLACE
-BUILDING CAPABILITIES AND ORGANIZATION LEARNING
-EFFECTIVE HR MANAGEMENT SYSTEMS , SUPPORT AND MONITORING
----------------------------------------------------------------
KEY PERFORMANCE AREAS [ KPA ]
These are the areas within the ORGANIZATION FUNCTIONS, where an
individual or group, is logically responsible / accountable
for the results.
To manage each KRA, a set of KPA / KPI are set .
KPA and hence KPI is attributed to the person who
can have effect on the business results and is
self measured where applicable
EXAMPLE OF HR
KRA = RECRUITMENT / SELECTION
KPA 1 = RECRUITMENT
KPA 2= SELECTION
KPi for KPA 1= reduce the recruitment cost per head by 10%.
KPi for KPA 2 = finalize selection in 5 weeks for each individual position.
--------------------------------------------------------------
.THE CHOICE OF HR KPI WILL VARY FROM YEAR TO YEAR,
SUBJECT TO COMPANY'S
-STRATEGIC PLANNING
-CORPORATE STRATEGIES
-CORPORATE OBJECTIVES
WHICH IN TURN AFFECTS THE HR'S
-HR STRATEGIC PLANNING
-HRM STRATEGIES
-HRM OBJECTIVES
-------------------------------------------------------
The HR Balanced Scorecard is the measurement tool. It provides the management with a tool and a process to measure the performance of people practices and the HR function from multiple perspectives:
1. Strategic Perspective — the results of strategic initiatives managed by the HR group. The strategic perspective focuses on the measurement of the effectiveness of major strategy-linked people goals. For instance, the business strategy called for major organizational change programs as the business faced major restructuring and multiple mergers and acquisitions. In this context, the organization’s change management capability will be a key factor in the success or failure of its execution. Therefore, measuring the ability of the business to manage change effectively is the core measure of the effectiveness of HR and will be a key strategic contribution to the future success of the business.
EXAMPLES
-change management capability of the organization
-organization compensation and benefit package with respect market rate.
-organization culture survey
-HR BUDGET / ACTUAL
-HR COSTS BENCHMARK EXTERNALLY
-HR annual resource plan.
-skills/ competency level
etc
2.Operational Perspective — the operational tasks at which HR must excel. This piece of the Balanced Scorecard provides answers to queries about the effectiveness and efficiency in running HR processes that are vital to the organization. Examples include measuring HR processes in terms of cost, quality and cycle time such as time to fill vacancies.
EXAMPLES
-time taken to fill vacancies
-cost per recruitment promotions
-absenteeism by job category
-accident costs
-accident safety ratings
-training cost per employee
-training hours per employee
-average employee tenure in the company
-lost time due to injuries
-no. of recruiting advertising programs
-no. of employees put through training.
-turnover rate
-attrition rate
etc
3.Financial Perspective — this perspective tries to answer questions relating to the financial measures that demonstrate how people and the HR function add value to the organization. This might include arriving at the value of the human assets and total people expenses for the company. HR
EXAMPLES
-compensation and benefits per employee
-sales per employee
-profit per employee
-cost of injuries
-HR expenses per employee
-turnove cost
-employee '' workers compensation costs''
etc
4.Customer Perspective — this focuses on the effectiveness of HR from the internal customer viewpoint. Are the customers of HR satisfied with their service; are service level agreements met; do the customers think they can get better service elsewhere? Conducting an HR customer survey might typically arrive at this.
EXAMPLES
-employee perception of the HRM
-employee perception of the company , as an employer
-customer/market perception of the company, as an employer.
etc
All four components of the scorecard are used to define and measure the effectiveness of people-management activities and how the HR function executes them. This provides a strategic measurement and management process to show the connection between a company’s business strategies and goals and its HR strategies, activities, and results. The Balanced Scorecard can provide an ideal approach to measure the contribution that human resource management makes to business success.
With the HR Balanced Scorecard in place, it can assist organizations to easily monitor the workforce indicators that are key to their business success. Such solutions enhance HR’s ability to provide counsel to line management and deliver results that make a difference to the achievement of their goals and strategy and thereby to shareholders.
The apparent and inherent values that the HR Balanced Scorecard brings include:
Measurement provides the data and facts to support business decisions, giving credibility to HR recommendations and initiatives;
Collecting and using data to make decisionsregarding retaining and motivating the
workforce, giving the organization a competitive advantage in the marketplace;
The right mix of lead and lag measures helps the business assess its strategic
alignment and progress towards its objectives;
HR will be proactive in identifying potential improvements and bringing suggestions
to the business that improve bottom-line results; and
A business and linked measurement framework focuses activity on those tasks
that contribute to organizational success. This process lifts the role of HR from being viewed purely as a cost centre to that as strategic business partner.
================================================== ===============
HR Key Performance Indicators
Frequently used HR Key Performance Indicators include:
[[ FTE = full time employees ]]
Revenue per Employee (FTE)
Assets per FTE
Training Hours per FTE
Training Costs per FTE
HR Department Cost per FTE
FTEs per HR Department FTE
Acceptance Rate
Average Cost per Hire
Absence Rate
Turnover Rate
Resignation Rate
Human Investment Ratio
Compensation & Benefits/Revenue
Average Remuneration
Time taken per recruitment
Cost per recruitment
============================================
EXAMPLES of KRAs / KPAs / KPIs
KRA 1 -RECRUITMENT/ SELECTION
KPA 1- RECRUITMENT [KPI= average time taken per employee 2 months]
KPA 2 -SELECTION [ KPI = average cost per new employee RS 10,000]
====================================
KRA 2 - WORKFORCE PLANNING/ DIVERSITY
KPA 1 - ANSENTEEISM [ KPI = absent rate at 5%]
KPA 2- TURNOVER [ KPI = turnover rate at 7%]
KPA 3- DIVERSITY [ KPI = 3 FEMALES TO BE INDUCTED INTO MANAGEMENT CADRE]
=====================================
KRA 3- PERFORMANCE MANAGEMENT
KPA 1 - PERFORMANCE APPRAISALS [KPI = all staff to be appraised at least once annually]
KPA 2 -SUCCESSION PLANNING [ KPI = 8 POTENTAL staff to be identified and talent managed]
===================================
KRA 4 - REWARD MANAGEMENT
KPA 1- MARKET ORIENTED SALARY STRUCTURING [ KPI = total compensation to sales 12%]
KPA 2 -BENEFITS PLANNING [ KPI = 6% of total salary bill]
============================================
KRA 5 - WORKPLACE MANAGEMENT AND RELATIONS
KPA 1 -JOB EVALUATIONS [ KPI = 600 lower staff , below grade 4 to be evaluated]
KPA 2 - EMPLOYEE COMMUNICATIONS [ KPI = 4 newsletter on intranet,one per quarter ]
===========================================
KRA 6 - SAFETY AND HEALTH WORKPLACE
KPA 1 - SAFETY [ KPI = accident safety ratings, benchmark with industry]
KPA 2 - HEALTH [KPI = actual health expenditure vs budget ]
========================================
KRA 7 - BUILDING CAPABILITIES AND ORGANIZATION LEARNING
KPA 1 - TRAINING [ KPI = average training hours per employee annually= 24 hours]
KPA 2 - MANAGEMENT DEVELOPMENT [ KPI =average MD cost per employee annually= 16000 RS]
============================================
KRA 8 - EFFECTIVE HR MANAGEMENT SYSTEMS , SUPPORT AND MONITORING
KPA 1- HRIS [ KPI = finalize the software . RS 1.2 million capital budget]
regards
LEO LINGHAM
From India, Mumbai
Ashwini Kumar,
KRA = KEY RESULT AREAS
KPA = KEY PERFORMANCE AREAS.
IT IS NOT OFTEN POSSIBLE TO EVALUATE KRA,
AND HENCE IT IS SPLIT INTO KPAs.
KPAs are more focused and easy to monitor/evaluate
with KPI.
THE KPAs are weighted to make up the KRA.
===============================================
AS for the external factors affecting the performance,
the line managers do take into consideration this factor
while conducting the performance appraisal.
--------------------------------------------------------------------------------------------
In case of sales, this is a common problem where sales target
are set 12 months ahead on certain assumptions.
When these assumptions fail, the sales manager has to take
these factors into consideration while conducting sales
appraisal.
-this changes could take place , nationally.
-these changes could be in some few territories, and not all.
HENCE THE SALES MANAGER APPLIES , WHAT WE CALL
''MANAGING BY EXCEPTION''.
regards
LEO LINGHAM
From India, Mumbai
KRA = KEY RESULT AREAS
KPA = KEY PERFORMANCE AREAS.
IT IS NOT OFTEN POSSIBLE TO EVALUATE KRA,
AND HENCE IT IS SPLIT INTO KPAs.
KPAs are more focused and easy to monitor/evaluate
with KPI.
THE KPAs are weighted to make up the KRA.
===============================================
AS for the external factors affecting the performance,
the line managers do take into consideration this factor
while conducting the performance appraisal.
--------------------------------------------------------------------------------------------
In case of sales, this is a common problem where sales target
are set 12 months ahead on certain assumptions.
When these assumptions fail, the sales manager has to take
these factors into consideration while conducting sales
appraisal.
-this changes could take place , nationally.
-these changes could be in some few territories, and not all.
HENCE THE SALES MANAGER APPLIES , WHAT WE CALL
''MANAGING BY EXCEPTION''.
regards
LEO LINGHAM
From India, Mumbai
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