Managing an organization is not a simple responsibility. There are many things employers need to take care of to ensure the company is marching forward. This often requires having an efficient human resources reporting system so employers can gain insight into HR critical data.
By requesting an HR report, employers can ensure the workforce is performing well and also oversee important metrics such as employee turnover rates, onboarding statistics, and other critical procedures.
What Is a Human Resources Reporting System?
A human resources reporting system allows HR departments to access critical data such as statistics, metrics, and insights to make core decisions. With access to this data, HR managers can improve workforce-related procedures.
Functions of Human Resources Reporting Systems
The primary task of an HR reporting system is providing detailed information about the company’s staff. The three most important aspects that a human resource report should include are:
- Human resources monitoring
HR periodic reports allow employers to keep track of workforce metrics that are essential for the organization. Requesting HR reports enables employers to notice employees’ behavior patterns in an early stage, which helps prevent future problems.
- Management of general performance
Human resources reporting systems can help managers improve their performance and change strategies when necessary. By analyzing key metrics, managers can understand if their strategy is working and make the adjustments necessary to improve productivity in their departments.
Moreover, HR reports can show managers their employees’ performance and help choose potential candidates for promotions, benefits, or even termination.
An HR reporting system can also have external applications integrated, such as FutureFuel‘s interactive dashboard where employers can offer their employees student debt benefits such as refinancing.
- Department analysis
HR reports can offer valuable ways of assessing specific areas in the organization. These reports can show turnover rates, for example, per department. This helps company leaders to spot and address problems as they arise. This is why HR reports are essential when it comes to improving internal processes in any organization.
Human Resources Reporting Structure
According to a Capgemini case study, you should include at least this information in your report:
For a human resource report to be effective, it needs to include important metrics that provide an organizational overview. The most common HR metrics you should include in an HR report are:
Employers need to know different ranks and positions, including seniority.
It is important to get insight into the average age of your employees. With today’s aging workforce, this should be a key point to take into consideration when devising new strategies.
3. Gender Identity
It is of utmost importance to establish the distinctions between sex and gender, as well as understand how employees prefer to be treated.
Template provided by the Capgemini case study.
4. Level of Education
It is important to know your employees’ education level. However, this should only be used when specific profiles are needed and depending on the industry. Otherwise, the education level might end up excluding some employees unnecessarily.
5. Number of Active Employees
It is important to know the exact number of active employees in the organization for planning or restructuring purposes.
6. Workforce’s Function
Any HR report should include the different groups in the organization and the role they play. This metric is important to distinguish between senior managers, general managers, support staff, production staff, etc.
This metric shows absenteeism rates and how this affects the organization’s productivity levels. It also provides information on employees who tend to miss work on a regular basis.
Here you can see a template provided by the Capgemini case study.
8. Full-Time Equivalent
Full-time equivalent (FTE) is the number of hours an employee works as a full-time worker. This metric provides an accurate way of measuring the total workload of the organization in a specific period of time.
9. Employee Turnover
The measurement of employee turnover rates is a must in any HR report. Knowing the percentage of employees who leave in a specific period of time allows managers to devise a strategy if they need to increase employee retention.
This metric shows the onboarding process strategy and provides information on new hires. Any employee who joined the organization in the last year should appear here.
11. Absenteeism Cost
In some instances and depending on the industry, you can calculate how absenteeism rates affect the company’s finances.
12. Labor Cost
This is an important metric that shows the total cost of the workforce. This data is important to calculate profits and rentability.
13. Cost of Training
This metric shows the cost of training provided to employees. By knowing this information, you can allocate training resources more effectively.
14. Recruitment Cost
This represents the total cost of recruiting new staff members. Here, you can see how much the company spends on hiring agencies, advertising, and onboarding.
How to Make a Human Resources Report
There are a few different types of human resources reporting systems:
- Automated reports
- Manual reports
- Paper-based reports
Let’s take a look at some of the characteristics of these systems so you can choose the most suitable for your company:
There is a considerable number of organizations that still use manual HR reports. This is the typical case of the CEO asking the HR department for a report to gain insight into a specific aspect of the workforce.
The HR department will start to prepare this report including all of the metrics requested. This is often inefficient and time-consuming as it will require HR managers to work under pressure.
Automated reports take a more proactive approach than manual ones. With automated reports, the company’s CEO can check data as the need arises. This is a more efficient way to deliver an HR report since it becomes a part of the HR department’s periodic tasks.
For an HR department to deliver automated reports, they need to have access to a system – such as a dashboard.
The difference between manual reports and paper-based reports is the platform where they are created. While both reports are manual in essence, the first one is created by manually inputting data into a digital platform whereas the other one is printed.
Even today, there is a large number of organizations that still deliver paper-based reports to the CEO. This is not completely bad, especially when the information tends to remain the same for long periods of time.
That said, paper based-reports are not ideal for fast-growing companies that are often hiring and adapting processes, not to say they are not eco-friendly.
The main advantage of dashboards is that they allow you to analyze the company’s numbers and metrics in a visually appealing way.
Since a dashboard is an automated way to produce a report, it also offers you the possibility to analyze things like employee turnover in detail, such as turnover rates by department, positions, etc.
Dashboard help the HR department analyze turnover rates in detailed thanks to their AI, which can calculate turnover percentages automatically in a matter of seconds. Although this can be calculated manually, it would take a considerable amount of time to do so, especially in large companies with many departments and thousands of employees.
With this information, advanced dashboards can even make predictions based on tendencies, which allows leaders to proactively take action. This means that you can change your employee retention strategy and improve the overall employee experience before turnover rates increase.
Human Resources Reporting: General Guidelines
After you decide the type of human resources reporting system you want to use, it is important to focus on how to present the report. An effective HR report provides clean data and easy-to-interpret analysis of various aspects of the workforce.
I recommend that you follow these tips before you create the report:
- Aim for an automated report
Unless your company’s metrics remain the same for long periods of time (which you probably don’t want), you should aim for an automated report that provides fluid information. This way, the error factor is reduced drastically and you won’t need to take extra time to produce the report.
- Include relevant information only
It is important to include only the information that is crucial for analyzing tendencies, numbers, patterns, and employees’ behavior. Do not include information that does not add any value to the report. This will only make it difficult to read.
- Be careful with mistakes
You need to be extra careful while inputting data into the report. Typing the wrong number can make a huge difference in the final report — which can end up costing many dollars. Even the smallest mistake will get multiplied exponentially in the final report. For this reason, always double-check when inputting data on the dashboard.
What to Include in a Human Resources Report
Not only should you follow the general guidelines, but you should also take other aspects into consideration:
The information provided in the HR report will be critical in the decision-making process. This means that important changes can come based on the metrics and numbers shown in the report.
For this reason, being careful with mistakes becomes even more important, as faulty information can lead to changes that aren’t necessarily good for employees. In the long run, this can cause hurt feelings among the staff and decrease employee engagement drastically.
These are some tips to create an HR report with solid data that is easy to interpret:
1. Deliver a Clear Message
Automated HR reports tend to be more generic since there is a lot of information involved in these reports. However, delivering a generic report might not always be the best idea.
The reason for this is that not all the information that is generated automatically will be necessary. Sometimes, irrelevant information will be included in the report, making it more difficult to analyze.
2. Present the Information in the Right Context
Let’s be fair, not presenting the metrics and numbers in context can convey the wrong message. A report stating that thirty employees left the company, might raise a red flag. However, if we’re talking about a company with 10,000 employees, the perspective changes.
Although presenting raw numbers can be beneficial, it is important to present the information in the right context. In the previous case, apart from the raw number of 30 employees, you need to indicate that this represents 0.3% of the workforce.
For this reason, for every metric you present in the report, make sure to include the right context for workforce size, economic data, and any other contextual information.
3. Choose the Right Report Frequency
Depending on the industry, some companies need to run reports on a daily basis, whereas other companies might need to deliver reports on a quarterly basis only.
Determining the right reporting frequency for your company is essential to guarantee that any negative patterns will be discovered on time — before they become big problems. Running a report on a weekly basis might be a waste of time since there might be no relevant changes to be analyzed while doing it every three months might be too late to take proactive actions.
4. Take Real Action
After analyzing a report, you might need to brainstorm with some company’s leaders to determine the causes of problems and how to resolve them.
On the other hand, if things are going well, you can also take the opportunity to show some employee recognition. This will help them keep engaged and motivated.
Human Resources Reporting: The Bottom Line
Remember to aim for an automated reporting system if possible, as this will help you save valuable time and reduce the error-factor. Also, remember to include relevant information only and to have a clear idea of what the company’s goals are.
By doing this, your HR reports will help your company analyze metrics and devise crucial strategies accordingly.