KPI’s You Need to Measure in 2024

You don’t need to be a rocket scientist to know that staying ahead of the curve in the business world is essential. One of the biggest differentiators for an organization to stay competitive is  the ability to measure, analyze, and act on Key Performance Indicators (KPIs). It’s time to take a closer look at three KPIs that will make a significant difference to your Talent Optimization strategy: 

1. Time to hire
2. Time to productivity
3. Year One Turnover

Time to Hire 

Let’s start with the hiring process. Many organizations track the Cost to Hire (keep doing that!). Time to Hire is just as critical. Time to Hire measures how quickly you can transform a candidate’s acceptance of an offer into a productive addition to your workforce. This includes tracking the time and effort on pre-hire activities such as time spent creating an open position, crafting a job description and job ad, posting the position, and screening candidates. Then, how long is the time span between your organization sharing the offer and the new employee’s first day.

By tightening up pre-hire processes and using tools to expedite writing job descriptions, organizations can save time (and time is money!). In addition, consider auditing your hiring process by asking the following questions: 

1. What tools and processes are in place that automate mundane tasks?
2. How are you promoting open positions and through what channels?
3. How quickly do you respond to applications and career inquiries?
4. How transparent are you with candidates about their application status and your hiring process?
5. What is the candidate experience, overall? Does the candidate experience resonate with your company values and culture?

Taking steps to improve candidate experience and shorten time to hire will mean faster access to new talent, and fewer open roles, which will result in a quicker increase to performance and profit. With the clock ticking in the ever-competitive job market, making the right hire swiftly is vital. The next step is ensuring your new employees get up to speed quickly.

Time to Productivity

Now, let’s talk about time to productivity. What good is a fast hire if your new employees take forever to get up to speed on their new role? This KPI is all about measuring the time it takes for a new hire to become a productive member of the team.

You see, it’s not just about getting someone in the door; it’s about how quickly they can start contributing to the company’s goals. The longer it takes for an employee to reach their peak performance, the more it can cost your business. But wait, there’s more! Great employee onboarding can improve retention by up to 86% (more on that, below). So, keeping an eye on this KPI is like ensuring you’re getting a solid return on your investment in new talent. 

Here are areas to explore to improve Time to Productivity:

1. Length and thoroughness of the onboarding process.
2. Time spent 1:1 with a direct manager during onboarding (this was found to be most important to new employees!)
3. Mentoring, coaching, and training opportunities at your organization.
4. Employee engagement and confidence surveys post-onboarding.

Now that you’re measuring the time to productivity of those new hires, let’s take a look at new hire retention.

First-Year Turnover

While Time to Hire and Time Productivity are Leading Indicators, First-year Turnover is a lagging indicator, but still an important KPI to measure success. Have you ever hired someone who interviewed impressively well but then left the company within their first year? Nearly 38% of employees quit within the first year of employment and over 40% of employees who leave within the first year do so in the first 90 days. It’s a common predicament, and it can be a costly one. The cost of acquiring talent is not just about the time and money spent on the hiring process but also the investment in training and onboarding. Nobody wants to see their efforts walk out the door. If you start measuring and taking steps to reduce turnover now, you can save some heartburn and stay ahead of talent scarcity.

High turnover in the first year of employment is a red flag that something might be amiss in your hiring process. If you’ve been through this, you know how demoralizing it can be. By examining and measuring first-year turnover, you can spot trends and make the necessary changes to retain your talent and reduce those costly losses.

Consider the following: 

1. Are your job descriptions and job postings honest about what a day-in-the-life of the role looks like, or are your applicants feeling a bait-and-switch?
2. Is your onboarding process thoroughly preparing new employees for their position?
3. Are you adapting to workforce desires like flexible work schedules and hybrid opportunities?
4. Are your leaders equipped to effectively coach, develop, and support their team members?
5. Are you providing opportunities for development, to grow and retain your staff?

Bonus: Quality of Hire

Fast hiring and quick productivity are all well and good, but if you’re not bringing in the right people, you’re missing the mark. The quality of hire is a KPI that can be a game-changer. You might wonder, “How can you measure the quality of a hire?” That’s where tools like the Predictive Index (PI) come into play.

In a world dominated by technology and job application bots, finding the right fit is not always easy. Sometimes, quality candidates get lost in the sea of resumes. This is where PI and similar tools make a difference. Scientific assessments and tools help you identify a candidate’s hardwired strengths and cognitive abilities, making it easier to spot the best fit for your team. By focusing on quality, you can improve your cost to hire, time to hire, and speed to productivity, all in one go.

Conclusion 

To stay competitive and ensure success, it’s crucial to measure the right KPIs. Time to hire, speed to productivity, quality of hire, and first-year turnover are the keys to talent optimization, employee retention, and growing your business. By keeping a close eye on these metrics and taking necessary actions, you can navigate the challenges of the modern workplace with confidence.

So, are you ready to make 2024 your year of business excellence? Keep measuring, keep optimizing, and watch your organization flourish. Looking for actionable steps to improve your KPIs? Reach out to us at MindWire today.