measuring hr systems_kpmg

8/3/2019 Measuring HR Systems_KPMG

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Measuring HR Systems. Results of 2010

KPMG HR Benchmarking Survey

Alevtina Borisova

Partner, KPMG

TAX


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2010 ZAO KPMG, a company incorporated under the Laws of the Russian Federation, a subsidiary of KPMG Europe LLP, and a member firm of the KPMG network of independent member firmsaffiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved. Printed in Russia.

PEOPLE SERVICES

Since middle of 1990 - HR is no longer seen as administrators, but as

people to be involved in high-level strategic discussions, which means:

Technically

1. Shared Service Centers2. Centers of Expertise

3. HR Business partners (HR generalists)

4. Advisor of Management

5. Center of Communication

Per se

Appreciation of the value of human assets

Strategic thinking

Orientation to business needs and certaintargets

Making HR function more efficient

How to set up closer connection between business and HR?

Human Resources Transformation

2


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Subordination of HR Head

82.93%

12.20%

Deputy General Director

General Director

Evaluating HR Effectiveness

81,58% of 2009 HR Benchmarking participants

evaluate HR Function effectiveness:

Turnover rate

Budget targets

Employee satisfaction surveys results

Headcount of support functions

Russian Practice

How to involve HR Head in strategy developing process?

What metrics to use for evaluating HR Function effectiveness?

How to define target values for these metrics?

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Approaches

Approaches to Measure HR Effectiveness*

HR Management by Objectives

Value of Information

Surveys

HR Case Studies

HR Auditing

HR Key Indicators

HR Cost Monitoring

ROI

HR Benchmarking

Measurement focus

Moderate

Moderate

Goal Setting for HR Performance Measures

Attitudes/Perceptions

Qualitative Description with Data Low

Efficiency/Existence of Practices Low

Program/Function Performance Measures

Program/Function Low

Benefits vs. Costs High

Performance Measures/Practices

*Jack J. Phillips The Human Resources Scorecard: Measuring the Return on investment

4

High

High


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2010 ZAO KPMG, a company incorporated under the Laws of the Russian Federation, a subsidiary of KPMG Europe LLP, and a member firm of the KPMG network of independent member firmsaffiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved. Printed in Russia. 5

HR Benchmarking is the comparison of the numerical and qualitative indicators of a

companys HR management system to the same indicators of other companies.

What is HR Benchmarking

Collecting

measurable data

characterizing HR

management system

Assessing the

efficiency of HR

management

processes

Assessing HR ROI

Revenue per employee Personnel costs as % of revenue

Personnel costs per employee Payroll as % of total personnel costs Personnel Turnover HR Function FTE Ratio Costs of various benefits per employee Percentage of vacancies filled Training costs per employee

Headcount planning

and the budgeting of

HR costs

KPMG HR Benchmarking covers over 100

benchmarks in the following areas:

Financial and Statistical Data Headcount and Responsibilities of the Support

Functions (HR and Finance)

Compensation and Benefits Recruitment and Onboarding Training and Development Company Image and Corporate Culture


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Headcount and personnel costs

3.60%

35.51%

68.41%

27.29%

11.68%

1.58%

0% 20% 40% 60% 80%

Top Managers

Middle Managers

SpecialistsBlue collars

Sales employees

Support employees

Headcount by employee category

(% of total headcount, median)

7,9%

11,6%

12,8%

23,5%

0% 20% 40%

Personnel costs as a percent of revenue(median)

Banks and financecompanies

Production andautomotive

Headquarters

FMCG and Farmacy

Top Management

Middle Management

SpecialistsProduction workers

Sales Specialists

Support Staff

Banking and Finance

Industrial Products

FMCG

Pharmaceuticals

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Salary Dynamics Prognosis for 2010-2011

7

2010 salary changes, by employee category

January-April 2010

2%

6%

9%

11%

34%

38%

0% 5% 10% 15% 20% 25% 30% 35% 40%

Twice and more

February

March

January

April

No changes

Median Average 25th

Percentile 75th

Percentile

Total 10% 10% 8% 12%

Top Managem ent 10% 11% 9% 11%

Middle Managem ent 10% 12% 8% 12%

Specialists 10% 11% 8% 12%

Product ion W orkers 11% 11% 9% 12%

Sales Specialists 10% 11% 9% 13 %

Support Staf f 10% 10% 8% 12%


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Changes to Bonus Plans in 2009-2010

8

2009 Dynamics

2010 Dynamics

Changes to Bonus Plans in 2009

Change of terms Reduction of plans Increase of plans No Changes

Management 15% 15% 6% 67%

Sales Departm ents 20% 9% 9% 63 %

Other Employees 11% 13 % 2% 74%

Changes to Bonus Plans in 2010

Change of terms Reduction of plans Increase of plans No Changes

Managem ent 8% - 6% 86%

Sales Departm ents 19% - 6% 75%

Other Employees 6% - 4% 89%


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Benefits

9

24%

27%

32%

41%

44%

46%

51%

61%

63%

71%

90%

95%

0% 20% 40% 60% 80% 100%

Mobile phone compensation

Welfare assistance

Health insurance

Sick leave compensation

Life insurance

Corporate cars

Com an roducts at a discount

Sickness without medical certificate

Meals

Maternit leave com ensation

Corporate discounts for certain services

Per diem above statutory norms

The most widespread benefits

% of all participants


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4%

7%

13%

76%

0% 20% 40% 60% 80%

Reduction of plans

Change of t erms

Increase of plans

No

Changes to Benefits in 2009-2010

10

5%

5%

9%

82%

0% 20% 40% 60% 80% 100%

Change of terms

Increase of plans

Reduction of plans

No

Changes to Benefits in 2009(% of all replies)

Changes to Benefits in 2010(% of all replies)


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Personnel Turnover

11

Unappropritae salary level

Lack of opportunity for professional andcareer growth

Personal reasons

Working conditions

Turnover Causes Rank

11,3%

5,6%

9%

12% Banks and FinancialcompaniesFMCG and Farmacy

Production

All companies

Personnel Turnover

Compensation

Career and professional growth

Personal reasons

Working conditions

Banking and Finance

21%

Pharmaceuticals

FMCG

Industrial Products

All companies


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Recruiting

12

The number of vacancies filled by internal

candidates (median)

Percentage of vacancies filled

The number of vacancies filled by recruitment agencies

96.08%

18.03%

The number of vacancies filled by internal candidates 16.67%

17.57%

16.61%

25.75%

10.00%

0% 5% 10% 15% 20% 25% 30%

Banking and Finance

Industrial Products

Pharmaceuticals

FMCG


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Training

13

Number of trained employees

Number of employees trained by external providers

58.78%

21.05%

Training hours per 1 employee 7

Methods of evaluating the effectiveness of training

2.86%

34.29%

65.71%

82.86%

0% 20% 40% 60% 80% 100%

Employees' satisfaction with learning

Measuring employees' knowledge and skills

change

Evaluation of employees behaviour change afterlearning

HC ROI measurement


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Talent and Succession Pools

14

Number of employees (as % of average headcount)

Succession Pool Talent Pool

3.17% 2.15%

Number of filled vacancies

3.17% 2.15%

Turnover

1% 3.33%


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Motivation and Company Image

Non-financial motivation programs /

recognition programs Professionalism rewards Loyalty rewards Rewards to anniversaries, holidays

90% of all participants

Regular employee satisfaction

surveys

Building image among employees

Employee satisfaction surveys on annual basis


Corporate events

Internal communications (corporate media, etc.)


External image programs Sponsorship / charity (71%) Employer brand programs (54%)


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Presentor detailes:

Alevtina Borisova

PartnerTax and legal

[email protected]

+7 (495) 937 4477

ZAO KPMG

www.kpmg.ru

The informationcontained herein is of a general nature and is notintended to addressthe circumstances of anyparticular individual or entity. Although

we endeavor to provideaccurate andtimelyinformation,therecan be no guarantee that such information is accurate as of thedate it is received or that it

will continueto be accurate in the future.No oneshould acton suchinformation without appropriate professional advice after a thorough examinationoftheparticular situation.

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