How can HR professionals develop the needed skills to analyze and interpret metrics?

Answer 1

First, they have to understand the facts that are captured by the metrics; in other words, they have to understand the real-life operations of the business that the metrics pertain to. Then it's a matter of a very basic understanding of statistics, and of the "rules" (accounting or otherwise) that were used for deciding which data to capture and how to present it. Often it's just a matter of seeing an unexpected relationship between or among metrics and knowing where to ask for more detail. Usually the accounting department has already spotted unusual relationships and found out the reason for them (according to the accounting books, anyway), assuming that the metrics have been provided by the accounting department.

For example, if the HR Department hired fewer people this year than it did the year before, it might expect to see that the amount paid to recruiters this year had gone down as well compared to the prior year. However, if the amount paid to recruiters went up instead , that would look like an unusual event warranting further research. It could mean that headhunters' fee percentages (i.e, percentage of new hire' base salaries) went up, or that more very-high-salaried individuals were hired this year (and the recruiters' fees were a percentage of a much higher base salary amount for new hires), and the company ended up paying out more to the recruiters even though there were fewer new hires.