STOP BEING LAZY

TIE HR TO REVENUE

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Presenter Info

Kris Dunn
CHRO at Kinetix (RPO, Recruiting)
Founder of Fistful of Talent , The
HR Capitalist
Hoops Junkie

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HR/Recruiting/Talent
Departments UNITE:
Why do we have to end up
holding the bag?

HR/Recruiting/Talent Pro (In bandana) when

Lukewarm Turnover/Recruiting Report comes out

The World Keeps

Talking About Big
Data
Why Should HR Care?

Big Data for HR and Talent

A complete history of
employees and their
experience, skills, work
projects, education,
certifications, licenses, awards,
performance, compensation,
benefits, attendance, work
products, competencies,
comments, conversations,
connections
All of the same information for
all the people that used to work
for you
All of the same information for
those people who want to work
for you
All of the same information for
those people that you want to

Youre busy, youre under-staffed, and under-budgeted.

But thats ok, (you saw Moneyball, right?)
You I dont have the
time/resources/budget/tech
expertise to keep up with
everything
The Universe Waaahh
Snap out of it, you can
compete with the Big Boys.
How?
By being more aggressive,
smarter, faster, willing to
take chances, and thinking
differently about data and
tech and what they mean
to the business.

Why HR and Recruiting

Pros Need to SHIFT/LEAN
FORWARD When It
Comes to Thinking
About Tying HR to
Revenue

To Be Strategic, HR has to Stop

Reporting and Start Predicting
The HR Standard for reporting
has traditionally been about
what has happened in the
past
Too little focus has been
placed on predictive use of
data
You might not have true
predictive analytics, but how
comfortable are you and your
team at using data to
directionally predict the future
and identify gaps?

Cops Report and Enforce

Assassins Use Leverage To Get Change
Youve got data
People like Chequed.com
give you increased
visibility and access to
data
MOMENT OF TRUTH: What
are you reporting on, how
do you position the data
as tied to revenue and
how do you use the link to
drive behavioral change
in your organization?

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Tie HR To Revenue By
Reporting on What
Matters Most

RPE

The Holy Grail Revenue Per

Employee (RPE)
Think all the talk about a set of 20 metrics is
white noise?
Cut to the chase and report the biggest data
lever you have at your disposal Revenue
Per Employee (RPE)
RPE seamlessly merges whats most
important to most of you the performance
and effectiveness of people with whats
most important to the people who employ
you the financial health of the business as
noted by top-line revenue.
Use to drive attention and partnership with
any autonomous business unit or product
line delivering significant revenue.
Best practice in presentation appears to the
left bar chart for revenue by quarter with
line graph of total headcount.

Ways To Use Revenue Per Employee (RPE) To Do

Your HR Bidding (evil laugh)
Is RPE going up or down in various
divisions/product lines/territories? Why?
What do you believe in from an
organizational performance perspective as
a HR/recruiting pro? Performance
Management? Training? Tech Deployment?
Better hiring? Better firing?
What you believe in becomes your angle
as an organizational consultant to the
leaders of your company. If we want RPE
to go up with the same or added
headcount, heres what we need to do
RPE is about the state of the business and
what you can do to fix areas that indicate
they are broken. Its not about HR metrics.

If You Do Nothing Else From this Webinar,

Copy this Chart and Use at Your Company

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The Road Gets Muddy

Once You Want
Something Other Than
RPE
(but if youre brave, its

Lets Talk About Linking

Revenue to Headcount
Management and
Selection

Salary Cap Utilization

When it comes to managing
headcount dollars and FTEs, there
are 3 universal truths:
1. HR Departments report FTEs more
than they report $$$
2. Business leaders long for max
autonomy. FTE reporting is the
opposite of this
3. Most people are familiar with the
sports world concept of a salary cap.

In moving to reporting on company

and departmental salary caps,
smart HR departments focus on
flexibility and consultative solutions,
which make them an assassin
instead of a cop.

How to Report Headcount Via

Salary Cap Utilization and Tie To Revenue
Salary Cap (per department or by manager with
large spans of control) = Budget Salary Dollars for
month/year (recommend month-to-month breakout)
Salary Cap Utilization = % of Salary Cap spent for month.
Report month and chart trend. Report headcount if needed
but eliminate budgeted headcount just report actuals.
Call it the Salary Cap
Makes HR consultative via flexibility with the following
topics merit increases, equity increases, offers above
budgeted amount, retention of high priced talent vs.
performance expected, etc.
Can you reinvent your department with the same cap
number?
You want to do something new? What are you willing to
give up?
Advanced Play Turnover Factor baked in to reduce salary
cap for open position float.
THE KEY YOU HAVE TO HAVE C-LEVEL SPONSORSHIP
THAT WONT ALLOW EXECS TO NOT HIRE TO MAKE
BUDGET (SANDBAG) COMMITMENT TO THE FACT
THAT GOOD MANAGERS STAFF UP AND GO AFTER
REVENUE RATHER THAN MANAGE EXPENSE.

Hiring Manager Batting Average

Have you ever had a hiring
manger who:
Was awful at interviewing and
making hiring decisions, and/or;
Couldnt keep good talent once she
onboarded it?

You know who your best hiring

managers are in interviewing,
marketing the company to
candidates, making the right
offer and giving them what they
need once theyre part of the
team

It only stands to reason you

should be reporting on that...

How to Calculate Hiring Manager Batting

Average (HMBA) And Tie it To Revenue
On HMBA A miss is a miss
Use the rolling stats of at least a years worth of
data
Unlike raw turnover reporting, HMBA gets to
quality of interviewing, quality of match (not
overshooting or undershooting) as well as
micro-culture considerations on individual
teams
THE FORMULA <All employees hired by
manager over time period still with
company>/<All employees hired by manager
over time period, including those who have
left>
Want to launch this piece of big data? Go back
over the last 3 years of hiring data and put it
together. If you want to be PC, report it out by
department, then report the actual HMBAs to
the department head, along with your
recommendations, of course
THE KEY YOU NEED C-LEVEL
SPONSORSHIP THAT EXECS/Managers WHO
CANT HIRE WELL COST THE COMPANY
REVENUE IN ALL AREAS NOT JUST SALES.

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DO YOU BELIEVE THAT TIME

TO PRODUCTIVITY DRIVES
REVENUE?
Then you should look at turnover in a
dramatically different fashion

Start Predicting Turnover Over Simply

Reporting On It
#1 All Time post on the HR
Capitalist Turnover Calculator
Most of us are reporting turnover,
but were not predicting it.
Reporting turnover is a start.
Turnover is the biggest lever you
have to getting organizational
change that is friendly to talent
often from leaders that are hostile
to HR and recruiting.
Always start any data play using
turnover with no less than a years
worth of data.

3 Ways to Experiment with Turnover

Prediction that Impact Revenue
1. Project Turnover for Next
Month/Quarter based on annualized run
rates.
2. Pick the variable(s) you think has the
most juice and add it as an influencing
factor (example You think a mix of age,
tenure, comp-ratios and size of last
increase impact turnover. You study and
implement it into your reporting.) Note that
the best way to find influencing factors is to
study whats happened in the past.
3. Our Recommendation Focus on Turnover
in the 1-3 year tenure range easiest
argument related to time to proficiency.
4. Its not cost of turnover that drives
revenue, its the cost of BAD Turnover
that drives revenue.

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DO YOU BELIEVE HIGHER

ENGAGEMENT & EMPLOYEE
DEVELOPLEMENT DRIVE
REVENUE?

Leadership Birth Rate (LBR)

What it is:
A metric that shows which
leaders are growing new leaders.

What you need:

Leader pipeline and succession
data.

Why it will make a difference:

The most important thing a
leader can do is develop new
leaders for the organization.

Leadership Gravity
What it is:
A metric that shows you who your
best employees are going to work
for in your organization.

What you need:

Employee performance data,
internal mobility data.

Why it will make a difference:

Your employees will tell you a lot
who your best leaders are, who
your worst leaders are, etc.

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Thank you to our webcast sponsor:

#Chequed

Kris:
kdunn@kinetixhr.com
www.fistfuloftalent.com
Twitter: @kris_dunn
Cell 205.383.9600
LinkedIn:
www.linkedin.com/in/krisdunn