The Human Resources Benchmarking Network An HR Metrics (and) Benchmarking Tool for Municipalities

Colin Dawes OMHRA Spring WorkshopGuelph, April 2011

Presentation Agenda

Benchmarking Concepts HR Metrics for Municipalities The Human Resources Benchmarking Network The Municipal Group in the HRBN Survey• HR Trends in Municipal Government 1998 and 2010• Key Results from the 2010 HRBN Survey Report Applications for HR Metrics• Training, Technology and the HR Department• Measurement Advice from the HRBN

Introductions/Agenda

My Second Agenda

1. Remind you about a few things you already know.

2. Measurement and benchmarking concepts and tools you can use to help your organization be more successful – sometimes despite itself.

Benchmarking Concepts

What isBenchmarking?“Benchmarking is a continuous, systematic tool for measuring and improving the processes, products and services of an organization by comparing them to the very best “like” processes, products and services wherever they may be found.”

The Council for Continuous Improvement

HR Metrics for Municipalities

My Selection Criteria

Frequently completed (in the HRBN experience)

Simple to understand Avoid duplication Significant Impact – either on HR or

the Organization

My TOP TEN Indicator Selections (HRBN Survey)

1. External Hire Rate: PFT and Reg. PPT (can be compared to Turnover indicators)

2. Average Time to Fill a Position With an External Hire

3. Number of Non-Management Employees Per Management Employee

4. Extended Health Care Claims Expense Per Participating Employee

5. Paid Sick Hours Per Eligible Employee

My TOP TEN Indicator Selections (HRBN Survey)

6. * “Pre-External Intervention” Grievance Rate

7. Workers Compensation Lost Work Hours Rate

8. Modified Work Accommodations Rate9. HR Technology Indicator10. Employees Per HR FTE

The Human Resources Benchmarking Network

What is the HRBN? Cross-Canada network of HR

functions primarily from Health Care, Municipal Government and Not-for-Profit employers who complete the HRBN Survey

Open to all sectors Current representation in six (6)

provinces

The Annual Benchmarking Survey

Presently fifty-five (55) indicators Balance of “Human Asset” and “Human

Resources” indicators Full spectrum of HR function represented More In-depth quantitative analysis possible

through demographic breakdowns Electronic Format (Multi-Sheet Excel File) Content determined by input from Network

members

Sample Survey Indicators

External Hire Rate

Average Time to Fill Position With External Hire

Salary to Operating Expense Ratio

Manage-ment to Staff Ratio

Paid Sick Hours Per Eligible Employee

Training and Dev’t Expense Indicator

Extended Health Benefit Claims Expense Indicator

HR “Admin” Expense to Operating Expense

EAP Utilization Rate

WCB Lost Time Incident Rate

“Final Step” Grievance Resolution Rate

HR “Legal Costs” Per Employee

Turnover Rate

HR “FTE” Indicator

“Modified Work” Accommo-dation Rate

HR Technology Indicator

HR Training Courses Attendance Indicator

Internal Transfers to Total Hires Ratio

“Final Step” Grievance Rate

Benefits Expenses to Compensation Expense

Sample Indicator Definition

The Report of the Annual Benchmarking Survey

Benchmark statistical data for each indicator (average, percentile, etc.)

Note of special statistical relationships if indicated

Statistics breakdowns by Province/Sector where justified by sample size

Summary table of individual data submissions for the indicator

Contact names for Network Survey participants

The Report of the Annual Benchmarking Survey

Sample Data Table: Paid Sick Hours Per Eligible Employee, HRBN Report

The Municipal Group in the HRBN Survey

Human Resources Trends in Municipal Government: 1998 to 2010

Trend Setters: Municipal Participants in the 1998 HRBN Survey

City of Oshawa City of Toronto Region of Durham Region of Hamilton-Wentworth Region of Niagara Region of Ottawa-Carleton Region of Sudbury Region of Waterloo

Some Things Change …Indicator 1998

Survey 2011 Survey

Change

External Hire Rate

9.9% 16.2% Substantial increase (63.4%) in hiring rates since the late 90s.

Dental Expense Per Participating Employee

$683 $1,112 A significant increase (63%).

Staff Per Management Ratio

19.3 24.8 Not good news for “span of control”.

HR Legal Costs Per Employee

$50.77 $77.43 No surprise here, with the increasingly complex legal environment.

Employment Advertising Expense Per Hire

$272 $446 64% increase. Reflects increased competition and prices, online solutions.

Some Things Change … A LOT.Indicator 1998

Survey 2011 Survey

Change

Extended Heath Care Expense Per Participating Employee

$854 $2,160 Extended Health care claims – 153% increase in costs (primarily drug-related, increased use of para-medicals, etc.)

EAP Utilization Rate

7.2% 15.4% EAP usage becoming more common (115% increase).

HR Technology Indicator (showing Ratio of points scored to possible points)

0.375 0.764 Technology has advanced a great deal (107% increase).

And Some Things Change Less.Indicator 1998

Survey 2011Survey

Change

“All Grievances” Rate

5.4% 5.3% Surprisingly, unions appear to have been upset with employers on a consistent basis for years.

WSIB Incidents/Lost Hours

3.1%/3.9 hours

4.3%/3.8 hours

Less time lost – but more incidents? Lost hours result makes more sense …(Accommodations up slightly 6.6%!)

Employees/HR “FTE”

102 100.3 Ontario figures generally unchanged.

Sick Pay Expense Indicator

3.3% 3.4% This result, and the next, suggest that we may have reached a “plateau” of sorts.

Paid Sick Hours Per Eligible Employee

66.5 69.2 As noted in “Sick Pay Expense”.

Survey Demographics – 2010 Survey

Municipal group represents 28% of the survey participants (22 in all) and 105,000 employees

Many smaller municipalities plus most members of the Regional and Single Tier Municipalities (RSTM) Group RSTM – 12 Other Cities – 6 Towns – 2 Counties - 2

RSTM - Special Indicator Set - 2004 (16 indicators in all)

Ontario Municipal CAO’s Benchmarking Initiative (OMBI) and the HRBN HR Group asked to identify HR indicators for OMBI Decision to align indicators to the HRBN Survey

(avoid duplication) Four (4) indicators identified:

o #T4s per HR staff (Service Level)o HR administration expense per $1000 of municipal

operating expenditure (Service Level)o HR services cost per T4 supported (Efficiency)o Turnover Rate (Customer Service)

Metrics Challenges in Municipal HR Measurement Complexity/differences in the how and

“who” provides HR services to different employee groups

Definition of employees … Specific Indicator Challenges

o T4 vs. active employee countso What counts as “HR”o Expenses/internal charges

Key Results from the 2010 HRBN Report

HRBN #5 – Average Time to Fill a Position Formula: Total, for all External Hires, (Difference Between the “Date the Offer to the New External Hire is Made” and the “Date the Approval to Recruit is Received in HR”, One Year period

Statistic Survey Health Care Municipal

Sample Size 36 25 10Average 45.4 44.6 47.710th Percentile 16.4 15.5 20.825th Percentile 23.9 24.4 24.50th Percentile 44.5 45 48.475th Percentile 65.4 65.8 58.890th Percentile 77.6 72.9 81.7

NOTE: Permanent, Full-time and Regular Permanent, Part-time Positions take longer to fill - 59 days for the full survey (59 days for the municipal group as well)

HRBN #7 – Turnover Rate Formula: # Separations / # Average Employee-count, One Year period

Statistic Survey Health Care Municipal

Sample Size 66 48 17

Average 11.2% 10.6% 12.4%

10th Percentile 6.9% 7.2% 5.7%

25th Percentile 8.5% 8.8% 7.8%

50th Percentile 11% 10.4% 11.5%

75th Percentile 13.1% 12.5% 15.1%

90th Percentile 15.7% 13.9% 21.2%

HRBN #4A(1) – Non-Management Employees Per Management EmployeeFormula: # “Non-Management Employee-count” / # “Management” Employee-count, End of Survey Time Period, One Year period

Statistic Survey Health Care Municipal

Sample Size 73 55 17Average 27.6 28.9 24.810th Percentile 11.9 16.9 7.825th Percentile 19.6 22.0 11.850th Percentile 25.7 26.9 23.775th Percentile 31.8 32.0 30090th Percentile 42.0 41.9 39.4

HRBN #15 (A & B) – EAP Indicators (Municipal Sector)

Formulas:(A) EAP Cases / Average Eligible Employee-Count (B) EAP Expense / #

Employees Eligible to Use the EAP, One Year period

Statistic (A) EAP Utilization Rate

(B) EAP Expense Per Eligible Employee

Sample Size 14 16

Average 15.4% $47.10

10th Percentile 7.8% $26.12

25th Percentile 12.2% $29.34

50th Percentile 15.6% $46.90

75th Percentile 17.9% $53.95

90th Percentile 22.8% $75.50

HRBN #25 – HR Administration Expense Indicator (Municipal Group)

Formula: $ HR Administration Expense / $ Operating Expense , One Year period

Statistic Survey

Sample Size 15

Average 0.6%10th Percentile 0.4%

25th Percentile 0.5%

50th Percentile 0.6%

75th Percentile 0.6%

90th Percentile 1%

HRBN # 1 and #7: Comparison - External Hire Rate and Turnover Rates, Municipal Group, 2007-2010

0

2

4

6

8

10

12

14

16

18

2007 2008 2009 2010

External HireRateTurnover Rate

HRBN #13: Paid Sick Hours Per Eligible Employee, Health Care and Municipal Groups, 2007-2010

58

60

62

64

66

68

70

72

74

76

78

80

2007 2008 2009 2010

Health CareMunicipal

HRBN #9 and #10: Dental Claims and Extended Health Expense Per Employee, Municipal Group, 2007-2010

$0

$500

$1,000

$1,500

$2,000

$2,500

2007 2008 2009 2010

EH claimsexpense peremployeeDental claimsexpense peremployee

HRBN #23: Percentage of HR Departments Utilizing Technology, By Technology Type,

2007-2010

0

10

20

30

40

50

60

70

80

90

100

2007 2008 2009 2010

E-MailInternetHR IntranetHRIS

HRBN #14(C) – Breakdown of Points in Time at Which Grievances were Resolved or Withdrawn in Survey Reporting Period, 2010 (Municipal Group)

19%

8%

28%

46%

Prior to "Final Step"MeetingAt "Final Step"MeetingThrough Third PartyInterventionAt Arbitration

Applications for HR Metrics

Applications for HR Metrics Reporting purposes Support HR quality goals Prove/disprove existence of opportunities Demonstrate success/failure of initiatives Illustrate cause/effect relationships Impacting adversarial negotiations or settlement

opportunities Create business cases and obtain resources Improve measurement systems Positive reinforcement

HRBN #22 – HR Training Course Attendance(Municipal Group)

Formula: # Training Course Attendance (Per Category) / # Average Employee-count (or New External Hires in case of Orientation),

One Year period

Statistic WorkplaceCompetency

Orientation(of external Hires)

Health and Safety Training

Sample Size 16 14 17

Average 81.1% 51.9% 62.8%

25th Percentile 28.3% 16.0% 16.0%

50th Percentile 39.0% 40.5% 26.0%

75th Percentile 110.5% 96.0% 43.0%

90th Percentile 154.5% 107.2% 170.0%

HRBN #23: Percentage of HR Departments Utilizing Technology, Municipal Group, By

Technology Type, 1998 to 2010

0

10

20

30

40

50

60

70

80

90

100

1998 2010

E-Mail

Internet

ElectronicFormsHRIS

HR Intranet

ManagerAccess HRISEmployeeAccess HRIS

HRBN #24 - # Employees Per HR “FTE”Formula: # Average Employee-count / # HR “FTE”-count, End of

Survey Time Period, One Year period

Statistic Survey Health Care Municipal

Sample Size 76 53 22Average 132.1 146.8 100.310th Percentile 74.6 78.2 65.925th Percentile 91.0 95.1 90.650th Percentile 114.8 124.9 104.975th Percentile 146.8 185.2 118.990th Percentile 220.9 249.9 129.3

HRBN #24(B) – HR FTE Detail – Functional Breakdown (Municipal Group) 1998 and 2010

0% 50% 100%

1998

2010RecruitmentBenefitsHRIST & DWorkers Comp/H&SCompensationEmployee RecordsEmp/Labour RelationsOrg. DevelopmentOther

Trends –Benefits and HRIS, and new HR functions (quality, metrics, etc.), and to a lesser extent, WC/H&S and Recruitment, receive more staff resources now, vs. in 1998.

HRBN #24(C) –HR FTE Detail – Organization Level Breakdown (Municipal Group) 1998 and 2010

0% 50% 100%

1998

2010 Executive

Manager

Professional/SupervisoryAdministrativeSupport

Trends – There has been a clear trend toward a higher proportion of supervisors, at the expense of both executives and managers, and administrative/clerical positions.

HRBN #24(C) –HR FTE Detail – Model of Service Provision Breakdown (Municipal Group) 1998 and 2010

0% 50% 100%

1998

2010Traditional

Designated ClientGroupAlternative

Trends – A change in HR service delivery is definitely indicated, from the traditional (HR as a separate, “expert” dept. with HR specialties serving the organization to a model of HR professionals attached to client groups, with more generalists, and in some cases matrix reporting relationships with Operational departments.)

Measurement Advice from the HRBN

Don’t take on more measurement than you can handle Focus on objects that are critical success drivers Listen to senior management priorities and educate

where possible Balanced Choice of Metrics

Simple metrics (in design, in ability to collect data) are more reliable

Downside of Simple – inverse relationship simplicity/value

Leading vs. lagging where possible Technology will help (if you are lucky enough to have it)

But don’t stop with measurement …

Numbers are Susceptible to Manipulation! Numbers are Quantitative Portrayals of Real

World Situations Numbers are a Means Not an End

Any Questions?Colin Dawes

Human Resources Benchmarking Network

416-221-0260colin@hrbn.ca

www.hrbn.ca