East African Journal of Business and Economics, Volume 7, Issue 1, 2024

Article DOI: https://doi.org/10.37284/eajbe.7.1.1976

East African Journal of Business and

Economics
eajbe.eanso.org EAST AFRICAN
Volume 7, Issue 1, 2024 NATURE &
Print ISSN: 2707-4250 | Online ISSN: 2707-4269 SCIENCE
Title DOI: https://doi.org/10.37284/2707-4269 ORGANIZATION
Original Article

Essential Human Resource Metrics and Analytics for Sustainable Work

Environments: Literature Mapping and Conceptual Synthesis
Dr. Ann Gaceri Kaaria, PhD1*
1 Kiriri
Women’s’ University of Science and Technology, P. O. Box 49274-00100 Nairobi, Kenya.
* Correspondence Email: [email protected]

Article DOI: https://doi.org/10.37284/eajbe.7.1.1976

Date Published: ABSTRACT

08 June 2024 Human resource (HR) metrics and analytics play a critical part in creating
sustainable work environments in today's fast-paced and cutthroat business
Keywords: environment. The present study aims to investigate the critical HR metrics
and analytics required for establishing and preserving sustainable work
Human environments in organizations through a thorough mapping of the literature
Resource Metrics, and conceptual synthesis. In order to evaluate and improve sustainability
factors including employee engagement, retention, productivity, well-being,
Employee
diversity, equality, and inclusion (DEI), and environmental sustainability
Performance, practices, a wide range of HR metrics and analytics are examined in this
Organizational study. By means of a methodical examination of extant literature and
Performance, academic sources, this study pinpoints crucial HR metrics and analytics
Sustainable Work frameworks that facilitate sustainable work practices. In order to clarify the
Environments, interactions and connections between these HR analytics and indicators and
their effects on sustainable work environments, the study also performs a
Human
conceptual synthesis. The study intended to provide insights into how
Resource Analytics organisations may use HR metrics and analytics to promote sustainability
initiatives and develop positive work cultures by synthesising actual facts
and theoretical frameworks. The findings from this research contribute to
advancing the understanding of the strategic role of HR metrics and analytics
in promoting sustainability within organizations. By adopting a data-driven
approach and utilizing relevant metrics and analytics tools, HR professionals
and organizational leaders can make informed decisions, implement targeted
interventions, and cultivate work environments that foster employee well-
being, organizational resilience, and long-term sustainability. This research
offers valuable guidance for HR practitioners, researchers, and policymakers
seeking to enhance sustainability practices in the workplace.
APA CITATION
Kaaria, A. G. (2024). Essential Human Resource Metrics and Analytics for Sustainable Work Environments: Literature
Mapping and Conceptual Synthesis. East African Journal of Business and Economics, 7(1), 241-262.
https://doi.org/10.37284/eajbe.7.1.1976
CHICAGO CITATION
Kaaria, Ann Gaceri. 2024. “Essential Human Resource Metrics and Analytics for Sustainable Work Environments: Literature
Mapping and Conceptual Synthesis”. East African Journal of Business and Economics 7 (1), 241-262.
https://doi.org/10.37284/eajbe.7.1.1976.

241 | This work is licensed under a Creative Commons Attribution 4.0 International License.
East African Journal of Business and Economics, Volume 7, Issue 1, 2024
Article DOI: https://doi.org/10.37284/eajbe.7.1.1976

HARVARD CITATION
Kaaria, A. G. (2024) “Essential Human Resource Metrics and Analytics for Sustainable Work Environments: Literature
Mapping and Conceptual Synthesis”, East African Journal of Business and Economics, 7(1), pp. 241-262. doi:
10.37284/eajbe.7.1.1976.
IEEE CITATION
A. G., Kaaria “Essential Human Resource Metrics and Analytics for Sustainable Work Environments: Literature Mapping
and Conceptual Synthesis”, EAJBE, vol. 7, no. 1, pp. 241-262, Jun. 2024.
MLA CITATION
Kaaria, Ann Gaceri. “Essential Human Resource Metrics and Analytics for Sustainable Work Environments: Literature
Mapping and Conceptual Synthesis”. East African Journal of Business and Economics, Vol. 7, no. 1, Jun. 2024, pp. 241-
262, doi:10.37284/eajbe.7.1.1976.

INTRODUCTION making informed predictions based on data

insights (Pillai & Sivathanu, (2022). Over the past
Technological progress at a breakneck pace has
decade, there has been doubt about the effect of
resulted in a world where social media, cell
human resource analytics (HRA) on HR practices
phones, and the internet are commonplace. World
and operations due to a lack of theoretical
events like the COVID pandemic, the 2008
foundations and empirical data in this new
financial crisis, and the turmoil in Ukraine
discipline (Belizón, Majarín & Aguado, 2023).
recently all added to the sense of instability, peril
Current literature provides an in-depth
and irregularity. The sense of certainty, stability,
understanding of the concept and intent of human
and familiarity that individuals were accustomed
resource analytics (HRA). The essential elements
to has been replaced by a condition of change. The
of HR metrics, on the other hand, are unknown
abbreviation "VUCA," which stands for
and must be understood by businesses in order to
"Volatile," "Uncertain," "Complex," and
preserve sustainable work environments.
"Ambiguous," can be used to characterize this
Consequently, the researcher carried out an
kind of situation (Mind Tools Limited, 2024). In
extensive examination of HRA procedures
the present Volatile, Uncertain, Complex, and
encompassing three fields: information
Ambiguous (VUCA) landscape, numerous
technology, business metrics, analytics, and their
organizations are contending with conventional
relationship to human resource management.
human resource (HR) data reporting systems,
Scholarly research indicates that although the
which are hindered by the challenge of handling
concept of human resources (HR) analytics has
unactionable data. HR data plays a pivotal role in
been around for more than two decades, it has not
delineating performance measures within this
lived up to expectations with much speed. Belizón
fiercely competitive business milieu. Regarded as
and Kieran (2022) conducted a literature analysis
raw and disorganized information, HR data
and found that there is still uncertainty regarding
comprises various facets including employee
the added value that HR Analytics may offer to
attendance, performance, compensation, and
the core of HR, including its strategic position and
engagement-related metrics. Advancements in
contribution to operational deliverables across the
technology empower managers to assess
organisation. This is because HR Analytics is a
performance at all organizational levels by
relatively new HRM innovation. HR analytics, in
leveraging Human Resource data. However,
our opinion, is the process of making HR
effective management of HR data is imperative to
decisions based on data.
ensure its quality.
In order to properly support sustainable work
Data quality denotes the suitability of data for
practices, a number of key gaps are revealed by
utilization and its alignment with user
the existing state of HR metrics and analytics.
requirements. This encompasses four critical
First, there is an urgent need for all-encompassing
aspects: completeness, accuracy, validity, and
frameworks that incorporate different HR
consistency. Ensuring high HR data quality is
indicators and data and offer a methodical way to
essential for accurately deriving HR metrics and
promote sustainable work environments (Ben-

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East African Journal of Business and Economics, Volume 7, Issue 1, 2024
Article DOI: https://doi.org/10.37284/eajbe.7.1.1976

Gal, 2019). Likewise, there is a dearth of from the realm of HR analytics, enable
empirical research on the relationship between organizations to anticipate and prepare for future
HR metrics, analytics, and sustainability, HR challenges (Reddy & Lakshmikeerthi, 2017;
underscoring the need for additional studies to Falletta & Combs, 2020).
develop best practices that are supported by data.
LITERATURE REVIEW
It is also difficult to discern how various HR
indicators interact and work in concert with one HR analytics, characterized by an evidence-based
another, which makes it difficult to determine how approach, plays a critical role in informing
these metrics affect sustainability outcomes as a decision-making on the people side of the
whole. More research is specifically needed to business. It encompasses a spectrum of tools and
determine how HR analytics and metrics affect technologies, ranging from basic HR metric
DEI (diversity, equality, and inclusion) and reporting to sophisticated predictive modelling.
environmental sustainability in businesses. There Equipped with these tools, HR analytics
is still a large knowledge gap about the long-term empowers organizations to analyse data
effects of HR analytics and metrics on comprehensively and derive actionable insights to
organisational sustainability and resilience. drive strategic HR decisions. By leveraging both
Moreover, not much is known about how these descriptive and predictive metrics, HR managers
analytics and metrics should be customised for gain a comprehensive understanding of HR
various industries and organisational settings in performance and trends. This enables them to
order to effectively advance sustainability make informed decisions regarding HR
(Edwards & Edwards, 2019; Tursunbayeva, Di- management strategies, ensuring alignment with
Lauro & Pagliari, 2018). organizational goals and objectives. Ultimately,
the integration of HR metrics and predictive
The adoption of HR analytics and metrics for
modelling within HR analytics enables
sustainability reasons is further complicated by
organizations to optimize HR practices and
practical implementation issues. In-depth research
enhance overall business performance (Simón &
on the obstacles HR professionals encounter in
Ferreiro, 2018; Angrave et al., 2016).
this area is lacking. Ultimately, additional
research is required to optimise data-driven Descriptive metrics primarily centre on historical
decision-making processes to strengthen data, offering insights into past performance,
sustainability initiatives through the use of HR while predictive metrics equip HR managers with
metrics and analytics. The strategic use of HR foresight for future decision-making. HR metrics
metrics and analytics in promoting sustainability serve to assess past HR activities/processes and
in organisations can be greatly advanced by filling aid in forecasting future performance. These
in these gaps through thorough research and the metrics serve as guiding indicators for HR
creation of customised frameworks (Edwards, managers, directing them towards strategic human
Charlwood, Guenole, & Marler, 2022; Huselid, resource management (HRM) practices and
2018).HR metrics serve as instruments of enhancing organizational performance. HR
accountability, facilitating the assessment of the metrics are essential instruments utilized to assess
outcomes of specific HR functions. These metrics the impact, efficiency, and effectiveness of HR
are regarded as key performance indicators (KPIs) operations, offering invaluable insights into
as they offer insights into the effectiveness of HR various facets of organizational performance.
practices. While many HR metrics are descriptive,
providing a snapshot of the current status of HR Efficiency measurements within HR metrics play
practice outcomes, predictive metrics utilize a crucial role in quantifying any inefficiencies or
advanced analytical modelling to offer deeper wastage in HR investments, thereby enabling
insights into future outcomes (Strohmeier, Collet, organizations to optimize the allocation of
& Kabst, 2022). These predictive metrics, derived resources and enhance operational effectiveness.

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East African Journal of Business and Economics, Volume 7, Issue 1, 2024
Article DOI: https://doi.org/10.37284/eajbe.7.1.1976

Effectiveness, another key aspect of HR metrics, outcomes. Furthermore, HR metrics assist HR

evaluates the extent to which HR programs align managers in addressing HR challenges by
with organizational goals and successfully facilitating strategic decision-making. Predictive
achieve their intended outcomes. This metric HR metrics, developed through predictive
serves as a yardstick for assessing the efficacy of modelling, offer guidance to HR managers in
HR initiatives in driving organizational success. strategically planning future HR actions. Metrics
Furthermore, HR metrics also encompass the such as future attrition rate and predicted offer
evaluation of impact, which entails assessing the decline by candidates equip HR managers to make
strategic implications of HR outcomes on the decisions regarding employee retention practices
overall performance and success of the and future recruitment plans, thereby enhancing
organization. Understanding the strategic value of organizational performance.
HR initiatives enables organizations to align their
Relationship between Human Resource
HR strategies with broader business objectives,
Metrics and Sustainable Workplaces
fostering sustainable growth and competitive
advantage (Angrave et al., 2016). The relationship between essential HR metrics
and sustainable work environments is
Measuring HR metrics is critical for organizations
multifaceted, intertwined with organizational
that want to thoroughly evaluate HR outcomes
culture, employee well-being, and overall
and obtain insights into the HR department's
business performance. By effectively measuring
success. By leveraging present data derived from
and leveraging HR metrics, organizations can
descriptive metrics in HR practices, organizations
foster sustainable work environments that
can develop predictive analytical models. These
prioritize employee satisfaction, engagement, and
models facilitate the anticipation of future trends
long-term success. One of the fundamental
and enable informed decision-making,
aspects of this relationship is the alignment of HR
empowering organizations to proactively address
metrics with organizational goals and values.
challenges and capitalize on opportunities for
Essential HR metrics serve as quantitative
continuous improvement and growth. At times,
indicators of various HR processes and practices,
HR managers may make decisions without
including recruitment, retention, training, and
sufficient evidence of the potential benefits of
performance management. By tracking metrics
their investments. Nonetheless, HR metrics offer
such as employee turnover rates, engagement
valuable support and guidance for strategically
levels, and training effectiveness, organizations
informed HR decision-making, particularly
can assess their progress towards creating
concerning financial investments. Descriptive
sustainable work environments aligned with their
financial HR metrics, such as cost per hire or cost
strategic objectives. Opatha (2020) defines
per recruitment source, furnish insights into the
sustainable HRM practices as green HR practices,
efficiency of recruitment practices, aiding HR
HR analytics, and HR metrics applied across
managers in strategically benchmarking and
diverse HRM functions. Rapid digital
making decisions regarding recruitment source
transformation has led to growing demand for HR
selection or enhancing cost per hire effectiveness.
analytics solutions and services, with Asia Pacific
Moreover, HR managers can use these metrics to experiencing the highest growth.
consider budget allocation for recruitment.
Employee engagement is a cornerstone of
Similarly, descriptive non-financial metrics, like
sustainable work environments, and HR metrics
employee engagement score, net promoter score,
play a crucial role in gauging and enhancing
and satisfaction level, enable HR managers to
engagement levels. Metrics such as employee
gauge employee engagement and satisfaction
satisfaction surveys, turnover rates, and
levels. This insight helps HR managers make
absenteeism can provide insights into the overall
informed decisions regarding various HR
health of employee engagement within an
practices and contributes to enhancing business

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East African Journal of Business and Economics, Volume 7, Issue 1, 2024
Article DOI: https://doi.org/10.37284/eajbe.7.1.1976

organization. By regularly measuring these This has immediate effects on the organizational
metrics and identifying areas for improvement, success. Businesses that employ people analytics
HR professionals can implement initiatives to effectively experience a 25% improvement in
enhance employee morale, motivation, and productivity (Silwal, 2024).
commitment to the organization. Moreover,
The HR department shoulders the responsibility
essential HR metrics contribute to the creation of
of effectively managing the most vital asset of any
inclusive and diverse work environments, which
business establishment: its workforce. Employee
are essential for sustainability in today's
performance stands as a linchpin in dictating the
globalized world. Metrics related to diversity
success of an organization, underscoring the
representation, inclusion initiatives, and pay
indispensable role of the human resources
equity can help organizations assess their progress
department in promoting motivation, engagement,
in fostering diverse and inclusive workplaces. By
and productivity among employees. Monitoring
measuring and monitoring these metrics,
Key Performance Indicators (KPIs) constitutes a
organizations can identify gaps and implement
fundamental method employed by HR managers
strategies to promote diversity, equity, and
to gauge the achievements of their department.
inclusion (DEI) throughout the organization,
These HR KPIs serve as metrics to assess the
which in turn leads to greater innovation,
efficacy of an organization's HR practices. KPIs
creativity, and productivity.
serve as a collection of quantifiable metrics
Health and well-being are also critical empowering HR managers to vigilantly oversee
components of sustainable work environments, their department’s performance and enact
and HR metrics can provide valuable insights into decisions grounded in data. Through diligent
employee wellness initiatives. Metrics related to tracking of KPIs, HR managers can pinpoint areas
employee health outcomes, participation in ripe for enhancement, assess the efficacy of their
wellness programs, and work-life balance can HR strategies, and make well-informed choices to
help organizations evaluate the effectiveness of refine and optimize their HR processes (Ng,
their wellness initiatives and identify areas for 2023).
improvement. By prioritizing employee well-
The utilization of data and analytics in
being and measuring relevant metrics,
management has garnered escalating attention as
organizations can create environments that
researchers and practitioners endeavour to grasp
support physical, mental, and emotional health,
how data can be translated into actionable
leading to higher levels of employee satisfaction,
insights, thereby enhancing organizational
productivity, and retention. The relationship
performance. This surge in interest has extended
between essential HR metrics and sustainable
across various management domains, including
work environments is symbiotic and dynamic. By
human resources management (HRM), as
measuring and leveraging HR metrics effectively,
evidenced by the increasing adoption of HR
organizations can create environments that
analytics to sustain decision-making processes.
prioritize employee engagement, diversity and
Despite its growing popularity, HR analytics isn't
inclusion, and health and well-being, ultimately
a wholly novel concept. Instead, it has evolved
driving long-term success and sustainability. By
from prior research examining the influence of
aligning HR metrics with organizational goals and
HR practices like selection, training, and
values, HR professionals can play a strategic role
performance management, which boasts a rich
in fostering sustainable work environments that
history in social sciences encompassing industrial
benefit employees, organizations, and society as a
and organizational psychology, HRM, and
whole.
organizational behaviour.
HR metrics provide insights into the efficacy of
Cavanagh et al. (2024) reaffirms Integrating
HR practices, as well as a data-driven approach to
evidence-based human resource management
human capital management and future projection.

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Article DOI: https://doi.org/10.37284/eajbe.7.1.1976

(EBHRM) into the LAMP Model in HR Analytics continuous evaluation and improvement of
holds immense potential to significantly enhance rostering decisions' effectiveness on employee
line manager decision-making concerning wellbeing. Monitoring key performance
rostering and ultimately support the wellbeing of indicators related to wellbeing enables
all employees. This integration involves a organizations to adjust rostering strategies in real-
systematic approach that encompasses several key time based on data-driven insights. Fostering open
steps: Firstly, it's crucial to grasp the fundamentals communication channels with employees is
of the LAMP (Logical, Analytics, Measurement crucial. Soliciting feedback on rostering
and Performance) Model in HR Analytics. This preferences and wellbeing concerns empowers
model comprises four interconnected employees and enhances their engagement.
components: Logic, Analytics, Measurement, and Involving employees in decision-making
Performance. Each component serves a pivotal processes fosters a supportive work culture
role in harnessing data to refine HR processes and conducive to employee wellbeing.
strategies.
Finally, providing training and development
Next, the identification of wellbeing metrics opportunities for line managers enhances their
aligned with organizational objectives and understanding of evidence-based HRM principles
employee needs is essential. These metrics may and analytics capabilities. Equipping managers
encompass various factors such as work-life with the necessary skills and knowledge empower
balance, job satisfaction, stress levels, and them to make data-driven decisions that prioritize
employee engagement. Utilizing evidence-based employee wellbeing effectively. Integrating
practices ensures the selection of metrics that evidence-based HRM principles into the LAMP
accurately reflect the wellbeing landscape within Model in HR Analytics enables organizations to
the organization. Robust data collection optimize rostering decisions and support the
mechanisms must be implemented to gather both wellbeing of all employees. This holistic approach
quantitative and qualitative data pertaining to fosters employee satisfaction, and engagement,
employee wellbeing. Leveraging advanced HR and ultimately drives organizational performance.
analytics tools facilitates the effective analysis of By using logic, organisations may establish clear
this data, unveiling patterns, trends, and objectives and match their analytics efforts with
correlations that influence employee wellbeing strategic goals. Analytics provides the tools and
and rostering decisions. Integration of evidence- methodologies required to collect, analyse, and
based HRM principles into the analysis process is understand human resource data, allowing for
imperative. This involves leveraging insights evidence-based decision-making. Implementing
from academic literature and industry benchmarks the LAMP framework enables organisations to
to inform decision-making. For instance, use the potential of HR analytics and generate
evidence-backed interventions such as flexible data-driven insights for better talent management
scheduling and workload management strategies and organisational success. (Charvi, 2007-2024;
can promote employee wellbeing and enhance Bakre, 2019).
organizational performance.
Measures ensure that appropriate and meaningful
Utilizing predictive analytics within the LAMP metrics are set to track progress and assess the
Model enables line managers to forecast the performance of HR activities. Finally, process
impact of rostering decisions on employee refers to a systematic and consistent approach to
wellbeing. By leveraging historical data and human resource analytics, which includes data
advanced techniques like machine learning collection, analysis, reporting, and continual
algorithms, managers can anticipate outcomes and improvement.
make informed decisions that prioritize employee
HR analytics may offer insightful information
wellbeing proactively. Implementing a feedback
about the workforce, including trends, patterns,
loop within the LAMP Model allows for

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East African Journal of Business and Economics, Volume 7, Issue 1, 2024
Article DOI: https://doi.org/10.37284/eajbe.7.1.1976

and correlations that can be used to pinpoint areas optimisation. Through the use of HR analytics,
in need of improvement and chances for businesses can:
Figure 1: Metrics for human resources' advantages

Source: CHRMP (2007-2024)

What Constitutes a Human Resource's KPI stalwarts/proponents such as employee turnover

and Metrics? rate, time to hire, cost per hire, absenteeism rate,
training and development metrics, employee
HR metrics provide quantifiable information
engagement, time to productivity, diversity and
about your organization's HR operations,
inclusion metrics, employee satisfaction, and
allowing you to rapidly identify what works and
retention rates, among others. Each metric serves
what doesn't. Lack of needed information will
a distinct purpose, offering a unique lens through
result in wasted efforts, money, and time spent on
which to assess HR departmental performance.
workforce management tactics that do not
For instance, the employee turnover rate metric
produce the desired results (Factor HR, 2024).HR
aids in evaluating recruitment and retention
KPI metrics represent a set of measurable
strategies, while the employee engagement metric
indicators enabling Human Resource managers to
illuminates’ areas of potential disengagement,
meticulously monitor and assess their
prompting targeted interventions. HR KPI metrics
department's performance. These metrics are
stand as indispensable tools for HR managers,
pivotal in identifying areas ripe for improvement,
furnishing them with the means to evaluate
gauging the efficacy of HR strategies, and
performance, pinpoint improvement areas, and
fostering data-driven decision-making to enhance
make informed decisions geared towards
HR processes (actiPLANS, 2004-2024). They
optimizing HR operations.
encompass a broad spectrum of factors, including
employee engagement, productivity, recruitment, What Makes Monitoring HR Performance
retention, and beyond. Through diligent tracking Essential?
of these metrics, HR managers glean invaluable
The initial and pivotal step in crafting/designing
insights into their department's effectiveness and
metrics and analytics strategies for an
can judiciously craft strategies to bolster the
organization is pinpointing the prevailing
organization's overall efficiency. Among the
challenges they encounter. Given the dynamic
plethora of HR KPI metrics lie

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East African Journal of Business and Economics, Volume 7, Issue 1, 2024
Article DOI: https://doi.org/10.37284/eajbe.7.1.1976

nature of the global landscape, labour and industry measuring HR performance aids in substantiating
evaluation methods also evolve. The primary decisions and strategies for senior management.
focus remains on addressing the issues Armed with objective data, HR managers can
confronting both the organization and its human illustrate the influence of their HR strategies on
resources within the operational milieu. It's organizational success. This data-driven approach
imperative for the management to promptly not only ensures the HR department's contribution
resolve these challenges, considering the to the company's overall prosperity but also
competitive ethos prevailing in the world. Delays facilitates informed decision-making and
in making informed decisions could precipitate optimization of HR processes, nurturing a more
adverse circumstances for the organization. engaged and productive workforce.
Recovering from such setbacks might be time-
Significance of Human Resource Management
consuming, making it arduous for the
Systems in Assessing Human Resource Key
organization to align with evolving global
Performance Indicators
business requisites. Thus, the proactive approach
entails identifying novel performance indicators. Human Resource Management Systems (HRMS)
Metrics and analytics serve as invaluable tools in are indispensable for measuring HR KPIs, playing
gauging organizational performance and a pivotal role in automating and streamlining HR
facilitating timely decision-making. The processes, encompassing data collection and
organization should foster a robust Research and analysis. By leveraging an HRMS, HR managers
Development (R&D) framework wherein HR gain effortless access to HR KPI-related data,
professionals can experiment with novel metrics empowering them to make informed decisions
and challenge existing assumptions about aimed at optimizing HR processes. A primary
organizational systems. Such experimentation can advantage of utilizing an HRMS for measuring
foster innovation and pave the way for the HR KPIs lies in its capability to collect and
development of fresh metrics and analytics analyse data in real-time. This real-time data
paradigms (Durai et.al, 2019). Evaluating HR functionality equips HR managers to promptly
performance with KPI metrics is crucial for identify and address emerging issues, thereby
organizations to align their HR department with enhancing organizational HR processes and
overall business strategy. Given the HR bolstering overall efficiency. Furthermore, HRMS
department's pivotal role in managing a simplifies the tracking and reporting of KPI
company's most valuable asset—its employees— metrics for HR managers. By automating the data
measuring its performance ensures effective collection and analysis process, HRMS mitigate
management practices. Through the assessment of the risk of errors and save valuable time. HR
HR KPI metrics, organizations can discern managers can leverage HRMS to generate
strengths and weaknesses within their HR customized reports, furnishing insights into
department, pinpointing areas for further departmental performance, which can be shared
improvement. This, in turn, enables the with senior management and stakeholders.
optimization of HR processes, enhances employee
engagement and retention, and ultimately bolsters Additionally, HRMS offer invaluable insights into
organizational success (Durai et al., 2019). workforce trends and patterns. Through
longitudinal data analysis, HR managers can
Measuring HR performance is critical for discern areas of improvement or decline in
identifying patterns over time. HR managers can performance and implement targeted
see patterns in the success of their strategy by interventions. For instance, HRMS can pinpoint
tracking KPI data on a regular basis. For example, areas necessitating employee training and
if a company experiences increased turnover, HR development or areas where retention strategies
managers can analyse data to identify underlying require enhancement. In essence, HRMS serve as
issues and address them proactively. Moreover, essential tools for measuring HR KPIs, facilitating

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East African Journal of Business and Economics, Volume 7, Issue 1, 2024
Article DOI: https://doi.org/10.37284/eajbe.7.1.1976

real-time data analysis, streamlined tracking and and comparison process facilitates a comparative
reporting of KPI metrics, and providing analysis with peer organizations, aiding in
actionable insights into workforce dynamics. identifying areas of strength and areas needing
Leveraging HRMS to measure HR KPIs enables improvement.
organizations to optimize HR processes and
HR metrics also play a crucial role in measuring
contribute decisively to overall success. HR
the return on investment (ROI) for various HR
metrics are essential tools for organizations,
initiatives and programs. For instance, metrics
facilitating the measurement, tracking, and
related to training can quantify the impact of
enhancement of various aspects of human
training programs on employee performance,
resources management. They offer a host of
retention rates, and overall organizational
benefits that contribute to organizational success
outcomes. HR analytics also help with effective
and efficiency.
risk management by exposing potential hazards
One of the primary advantages of HR metrics is and obstacles in the workplace. These risks could
their role in performance measurement. By include issues with diversity and inclusion, skill
providing quantitative data, these metrics enable shortages, succession planning gaps, and
organizations to assess employee performance, compliance. Organizations should take proactive
departmental effectiveness, and overall steps to reduce these risks by monitoring relevant
organizational success. This data-driven approach KPIs. Utilizing HR metrics promotes enhanced
aids in evaluating progress towards set goals, accountability and transparency within the
identifying areas for improvement, and organization. Clear metrics and performance
acknowledging high-performing individuals or indicators enable employees, managers, and
teams. Moreover, HR metrics support data-driven leaders to understand expectations, track progress,
decision-making processes within the and take corrective actions as needed, fostering a
organization. HR professionals and organizational culture of continuous improvement and
leaders gain access to objective data and insights accountability.HR metrics offer valuable insights
that guide informed decisions across various that support strategic decision-making, enhance
domains such as workforce planning, talent organizational effectiveness, and drive continuous
acquisition, training and development, and improvement in human resources management
employee engagement initiatives. Analysing HR practices, thereby contributing to overall
metrics over time allows organizations to identify organizational success. This subject encompasses
trends, patterns, and correlations within their various terms, including "Workforce analytics,"
workforce. These insights help in proactively "Talent analytics," "People analytics," "Human
addressing issues such as employee turnover, Capital analytics," "Human Resource analytics,"
absenteeism, productivity levels, and performance and "HR analytics." Among these terms, "People
metrics while also capitalizing on opportunities analytics" stands out as particularly significant
for improvement. and is frequently utilized. Hence, this study
incorporates the mentioned terms within its scope
Another significant benefit is resource allocation
and analysis (Bonilla-Chaves, & Palos-Sánchez,
optimization. HR metrics assist in making
2023).
informed decisions regarding resource allocation
within HR departments. For instance, "People analytics" refers to a segment of Human
understanding recruitment metrics guides Resource Management (HRM) practice, research,
decisions on budget allocation for recruitment and innovation that leverages information
efforts, while analysing training metrics informs technologies and employs descriptive and
investment in employee development programs. predictive data analysis alongside visualization
Additionally, HR metrics enable organizations to tools. Its aim is to generate valuable insights
benchmark their performance against industry regarding workforce dynamics, human capital,
standards or best practices. This benchmarking and individual as well as team performance. These

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East African Journal of Business and Economics, Volume 7, Issue 1, 2024
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insights are strategically utilized to enhance an predict skill gaps, and figure out the ideal staffing
organization's effectiveness, efficiency, and levels. Organisations can proactively plan and
overall outcomes, while also improving the implement solutions to solve workforce
employee experience. HR professionals employ a difficulties by projecting future trends and
variety of analytical techniques, collectively scenarios.
known as HR analytics, to gather information and
Prescriptive Analytics: By suggesting actions or
make data-driven choices in their workforce.
interventions based on anticipated outcomes,
Below are the four main categories of HR
prescriptive analytics advances predictive
analytics.
analytics. It assists in addressing the query, "What
With the ability to gather and analyse HR data in should we do?" Prescriptive analytics makes use
novel and creative ways, HR Analytics has of sophisticated algorithms to maximise decision-
become a vital function for organisations in recent making and offer useful insights. Prescriptive
years. The way businesses manage their analytics can be used in HR to identify at-risk
workforce is changing due to the adoption of new employees through predictive models, advise
HR Analytics trends and technology, which has retention plans for them, and optimise workforce
important ramifications for both employers and deployment strategies to effectively accomplish
employees. Natural language processing, corporate objectives. It can also be used to provide
blockchain technology, a greater emphasis on personalised learning routes for employees based
employee experience metrics, social media data on performance data (Jaishi, 2024).
integration, AI and ML for predictive analytics,
Diagnostic Analytics: The goal of diagnostic
AR/VR for immersive training and onboarding,
analytics is to identify the underlying causes and
wearable technology for tracking employee health
contributing variables of particular HR outcomes
and wellness, and Internet of Things (IoT) for
or problems. that contributes to the explanation of
monitoring workplace productivity are some of
"Why did it happen?" In order to find correlations,
the emerging trends and technologies in HR
linkages, and drivers that affect HR metrics, this
analytics (Suresh, 2023).
kind of analytics entails a deeper examination of
Descriptive Analytics: Using historical data to the data. Diagnostic analytics, for instance, can be
comprehend and characterise previous trends, used to investigate the causes of staff attrition,
patterns, and occurrences inside the company is spot trends in performance evaluation scores,
known as descriptive analytics. It helps with examine the effects of training initiatives on
"What happened?" inquiries and offers a output or evaluate the success of diversity and
retrospective perspective of HR metrics. inclusion programmes. Organisations can address
Analysing employee turnover rates, diversity issues and enhance HR results by implementing
measures, recruitment sources, training focused interventions and strategies after
completion rates, and workforce demographics identifying the root reasons.
are a few instances of descriptive analytics in HR.
Together, these four main categories of HR
This kind of analytics establishes the framework
analytics—prescriptive, diagnostic, predictive,
for more complex analysis.
and descriptive—offer a thorough insight of the
Predictive Analytics: By using statistical workforce, support strategic decision-making,
algorithms and machine learning approaches, enhance HR procedures, and promote
predictive analytics makes predictions about the organisational success. Organisations can
future based on patterns found in past data. It successfully exploit data and proactively manage
seeks to provide answers to queries such as "What their human capital for improved business
is likely to happen?" HR departments can use outcomes by incorporating these analytics into
predictive analytics to forecast workforce demand HR operations.
and supply, identify high-potential workers,

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East African Journal of Business and Economics, Volume 7, Issue 1, 2024
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Differences Between Metrics and Analytics industries, including human resources (HR).
Although they seem similar, metrics and analytics
Analytics and metrics play key roles in data-
are not the same thing.
driven decision-making across a range of
Table 1: Differences between metrics and analytics
Metrics Analytics
Definition Metrics are measurable/quantifiable Analytics is the methodical examination
measurements that are used to monitor of data by statistical, mathematical, or
and evaluate particular facets of computational methods in order to derive
operations, procedures, or performance. conclusions, forecast outcomes, or assist
They offer numerical data that can be in decision-making. Analytics involves
compared between various segments or more than just displaying data; it also
over time. entails analysing data to draw insightful
conclusions.
Purpose Metrics are primarily used to compare Finding patterns, trends, correlations, and
performance or advancement to causal linkages in data is the goal of
predetermined benchmarks, targets, or analytics. In order to forecast future
objectives. They assist in keeping an eye trends, understand why specific results
on vital indicators and offer an overview happen, and inform strategic decision-
of the situation or results as of right now. making, entails deeper study.
Level of Metrics are frequently given as Complex analysis methods including
Complexity percentages or numerical numbers, and regression analysis, machine learning
they are usually simple to interpret. In algorithms, clustering, and data modelling
terms of computation and are all part of analytics. Accurately
understanding, they are easier. performing advanced analysis and
interpreting the findings requires a solid
foundation in data science and statistics.
Time Frame Metrics are frequently used for reporting Analysing recent data, historical data, and
and monitoring in real-time or almost predicting future patterns are all possible
real-time. Regarding operational or in analytics. It can be applied to scenario
performance measures, they offer analysis, forecasting, and long-term
prompt feedback. planning.
Actionability Metrics provide a clear indication of By exploring data patterns and
performance but may not always offer relationships in more detail, analytics
insights into why certain outcomes seeks to deliver insights that may be put to
occur or what actions to take. use. Making educated decisions, figuring
out where improvements can be made,
and comprehending the underlying causes
are all aided by it.

HUMAN RESOURCE MANAGEMENT KEY the employee turnover rate holds significant
PERFORMANCE INDICATORS importance for organizations as it provides
insights into the efficacy of their recruitment,
Employee Turnover Rate
retention, and talent management endeavours.
According to actiPLANS (2004-2024), employee Elevated employee turnover can pose substantial
turnover rate serves as a key performance financial burdens for organizations. The expenses
indicator (KPI) utilized to gauge/measure the associated with replacing an employee—
quantity or percentage of employees leaving an encompassing recruitment, training, and
organization within a designated timeframe. Such onboarding costs—can escalate significantly.
turnover can manifest either through voluntary Moreover, heightened turnover rates have the
means (such as resignations) or involuntary potential to detrimentally affect employee morale,
actions (like termination or dismissal). Assessing productivity levels, and overall customer

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East African Journal of Business and Economics, Volume 7, Issue 1, 2024
Article DOI: https://doi.org/10.37284/eajbe.7.1.1976

satisfaction (Vulpen, 2024). To compute the the offer on May 10th, the calculation would result
employee turnover rate, Human Resource in:
Practitioners should divide the number of
Time to Hire = May 10 – March 31 = 40 days
employees who departed from the organization by
the total number of employees, and then multiply This indicates that it took the organization 40 days
the result by 100 (Jay, 2024). to fill the job opening. This metric serves as a
valuable tool for evaluating the efficiency of the
This formula can be outlined as:
recruitment process. It enables organizations to
Employee Turnover Rate = (Number of identify areas for improvement, such as
Employees Who Left / Total Number of streamlining the screening process or reducing the
Employees) x 100 time it takes to schedule interviews. Determining
the time to hire is crucial for organizations to
Time to Hire
assess the efficiency of their recruitment process
Time to hire serves as a key performance indicator and make enhancements to attract and retain top
(KPI) utilized to gauge the duration it takes for an talent. By calculating this key performance
organization to complete the hiring process, indicator (KPI) metric, organizations can identify
starting from the moment a job opening is “tailbacks” in their recruitment process, reduce
advertised to when a candidate formally accepts the time it takes to fill open positions, enhance the
an offer. This metric holds significant importance candidate experience, and ultimately contribute to
for organizations as it enables them to assess the increased organizational productivity.
efficiency and effectiveness of their recruitment
Cost per Hire
procedures, pinpoint any bottlenecks, and
implement enhancements to streamline the entire Cost per hire is a key performance indicator (KPI)
process. metric employed to assess the total expenses
accrued by an organization to fulfil a job opening.
Prolonged time to hire can have adverse effects on
This metric holds significance for organizations as
an organization's capacity to attract and retain top-
it aids in evaluating the efficiency of their
tier talent. Delays in hiring may lead to diminished
recruitment strategies and ascertaining the budget
productivity, lowered employee morale, and
necessary to attract and retain top-tier talent. By
escalated costs associated with prolonged job
working out the cost per hire, Human Resource
vacancies. The measurement of time to hire
Professionals can pinpoint areas where they can
empowers organizations to monitor their
mitigate recruitment expenditures, including
advancements in reducing the duration required to
optimizing job postings, enhancing the candidate
fill vacant positions, enhancing the candidate
experience, and refining the recruitment process
experience and ultimately contributing to the
(Vulpen, 2024). Utilizing this KPI metric enables
organization's overall success.
organizations to make well-informed decisions
This formula can be represented as: aimed at minimizing recruitment costs while
simultaneously enticing and retaining high-calibre
To determine the time to hire, organizations talent. To determine the cost per hire,
should subtract the date the job opening was organizations must sum up all expenses linked to
posted from the date the candidate accepted the filling a job position and then divide this total by
offer, expressed as: the number of hires made. This calculation can be
Time to Hire = Date Candidate Accepted Offer – represented by the following formula:
Date Job Opening was Posted Total Recruitment Costs
Cost per Hire = Total Number of Hires
For example, if an organization posted a job
opening on March 31st and a candidate accepted Recruitment costs encompass various expenses
such as advertising, job postings, recruiter fees,

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Article DOI: https://doi.org/10.37284/eajbe.7.1.1976

travel costs, background checks, and onboarding organization (Lalwani, 2007-2024; Khan, 2024).
expenditures. Measuring training and development KPIs
enables organizations to pinpoint deficiencies in
Absenteeism Rate
their training schemes, assess the efficacy of their
The absenteeism rate serves as a key performance training endeavours, and devise strategies to
indicator (KPI) that gauges the proportion of days enhance the calibre of their training and
an employee is absent from work compared to development programs (Jay, 2024; Ng, 2023).
their total scheduled working days (Ng, 2023; Jay, Evaluating training and development
2024). This metric holds significance for effectiveness allows organizations to not only
organizations as it enables them to assess the improve employee performance but also foster a
repercussions of absenteeism on productivity, culture of continuous learning and development,
discern patterns, and formulate strategies to which are fundamental for sustained success in
mitigate absenteeism. Elevated absenteeism rates today's competitive business landscape. The
can detrimentally affect an organization's method for calculating training and development
productivity, morale, and financial performance. KPI metrics can vary based on the specific
By measuring the absenteeism rate, organizations objectives and aims of the organization's training
can monitor their advancements in reducing and development programs. Several common
absenteeism, enhance employee attendance, and formulas are utilized to measure these metrics,
ultimately contribute to the organization's including:
prosperity (Khan, 2024).
1. Training Cost per Employee: This metric
The calculation formula assesses the total cost incurred for training
and development activities per individual
Absenteeism Rate = employee. The formula for calculating this
Total Number of Days Absent
Total Number of Scheduled Working Days
𝑥100% metric is represented as Training Cost per
Employee = (Total Training Costs / Total
This methodical approach empowers Number of Employees)
organizations to quantify absenteeism accurately,
identify areas for improvement, and implement 2. Training Return on Investment (ROI): This
measures that foster a culture of consistent metric evaluates the return on investment
attendance, thereby strengthening overall derived from training and development
organizational performance. endeavours. The formula for calculating this
metric is expressed as Training ROI = ((Total
Training and Development Benefits – Total Costs) / Total Costs) x 100%
Training and development effectiveness serves as These formulas provide valuable insights into the
a key performance indicator (KPI) utilized to efficiency and effectiveness of training and
gauge the success of an organization's training development initiatives. By analysing these
initiatives. This metric holds significant metrics, organizations can make informed
importance for organizations as it facilitates the decisions, optimize resource allocation, and
assessment of the impact of their investments in enhance the impact of their training and
employee training and development on various development programs on employee growth and
aspects such as employee performance, retention organizational productivity and success (Lalwani,
rates, and overall business achievements. The 2007-2024).
implementation of effective training and
development programs can enhance employee Employee Engagement
skills, knowledge, and competencies, The Employee Net Promoter Score (eNPS) is
consequently leading to heightened productivity, based on the Net Promoter Score (NPS) system,
innovation, and profitability within the which was introduced by Fred Reichheld, a

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East African Journal of Business and Economics, Volume 7, Issue 1, 2024
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business strategist and author, in 2003. Fred promoters. The Passives are not factored into the
Reichheld, along with Bain & Company and equation. The resulting score can range from -100
Satmetrix, developed the Net Promoter Score as a to +100, with a higher score indicating a more
metric to measure customer loyalty and positive perception among employees.
satisfaction (Yaneva, 2018).
eNPS can provide valuable insights into employee
The concept of eNPS, specifically focusing on engagement, satisfaction levels, and overall
employees and their likelihood to recommend organizational health. It is often used as a key
their company as a place to work, is an adaptation performance indicator (KPI) in HR and
of the NPS methodology. It has gained popularity management to track improvements in employee
in human resources and management circles as a experience and identify areas for enhancement
way to gauge employee engagement, satisfaction, (Siocon, 2024).
and loyalty (Jay, 2024; Siocon, 2024; Bhat, 2024).
In 2003, Reichheld advocated that the Net
While Fred Reichheld is credited with the original
Promoter Score (NPS) was the pivotal metric for
NPS framework, various organizations and
managers aiming to boost sales growth. Over
experts have contributed to the development and
time, numerous companies have embraced NPS,
application of eNPS within the context of
with more than two-thirds of Fortune 1000 firms
employee experience and organizational
from various sectors incorporating it into their
performance. The Employee Net Promoter Score
business strategies (Kaplan, 2016). Despite its
(eNPS) is a metric used to measure employee
immediate and sustained popularity among
loyalty and satisfaction within an organization. It
managers, NPS faced criticism from academia.
is based on the Net Promoter Score (NPS) system,
Researchers highlighted several methodological
which was originally developed to gauge
issues with the original NPS study. For instance,
customer loyalty and satisfaction. The eNPS is
Reichheld (2003) focused on past sales growth
typically derived from a single question asked to
rates using basic correlations and assessed static
employees: "On a scale of 0 to 10, how likely are
NPS levels measured at a single point in time.
you to recommend [company/organization] as a
These identified issues, among others raised by
place to work to a friend or colleague?" Based on
critics, cast doubt on the validity of Reichheld's
their responses, employees are categorized into
(2003) assertion and consequently question the
three groups:
efficacy of NPS as a reliable predictor of future
• Promoters (score 9-10): These are employees sales growth (Baehre et al., 2022). Companies are
who are highly satisfied and loyal to the shifting their focus from solely measuring
company. They are likely to promote the employee satisfaction to evaluating employee
company as a great place to work to others. engagement. Nowadays, there is a growing trend
where organizations are placing emphasis on the
• Passives (score 7-8): These employees are
Employee Net Promoter Score (eNPS). This
generally satisfied but not as enthusiastic as
metric not only reflects how engaged employees
promoters. They are considered neutral and
are with the products or services offered by the
may not actively promote or criticize the
company but also how they view the company as
company.
an employer (Yaneva, 2018).
• Detractors (score 0-6): Detractors are
Employee engagement is a key performance
employees who are dissatisfied or unhappy
indicator (KPI) that measures a worker's
with their work experience. They are unlikely
commitment and emotional investment in their
to recommend the company to others and may
job and the firm for which they work.
even speak negatively about it.
Organizations should assess employee
To calculate the eNPS, the percentage of engagement because it has a direct impact on
detractors is subtracted from the percentage of productivity, job satisfaction, staff retention, and

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East African Journal of Business and Economics, Volume 7, Issue 1, 2024
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overall business success. High levels of employee those who rate it as a 6 or below on the same
engagement can lead to increased staff scale (Siocon, 2024).
motivation, better customer service, greater sales,
• Employee Engagement Survey: This metric
and a more positive work environment.
evaluates employees' perceptions of their
Conversely, low employee involvement can have
workplace and their level of involvement in
a negative impact on the whole company's bottom
their roles and the organization. The survey
line by increasing turnover, diminishing
encompasses inquiries regarding job
productivity, and other concerns. Organizations
contentment, managerial effectiveness,
can identify areas for improvement and build
communication channels, recognition
plans to increase employee engagement levels by
practices, and other elements influencing
measuring employee engagement KPIs.
employee engagement (Eqtble, 2022).
Employee engagement is characterized as a
person's dedication, motivation, and satisfaction Example:
with their job and work environment. It has a
Suppose a company conducts an employee
significant impact on productivity, performance,
engagement survey and gathers responses from
retention, and innovation, making it an essential
200 employees, covering aspects like job
component of human resource management.
satisfaction, communication effectiveness, and
Organizations can use metrics such as employee
recognition practices. After analysing the survey
happiness, employee turnover, and employee Net
data, the organization discovers the following
Promoter Score (eNPS) to monitor, quantify, and
insights:
estimate employee engagement levels (Bhat,
2024). The eNPS weigh up the likelihood that • 70% of employees’ express satisfaction with
employees will recommend their organization to their current roles.
others as a place to work. Employee satisfaction
• 60% of employees believe they receive
assesses how satisfied employees are with aspects
sufficient recognition for their contributions.
of their occupations and workplace, such as
development, recognition, leadership, and culture. • 50% of employees feel that communication
Employee turnover refers to the number of from leadership is clear and effective.
employees who leave their jobs, either voluntarily To determine an overall employee engagement
or involuntarily, within a given time period. A score, the organization might allocate weights to
high turnover rate can suggest low engagement, a each survey question based on its significance and
terrible match, or a lack of opportunities. The then compute an average score. For instance, if the
method for calculating key performance company assigns a weight of 40% to job
indicators (KPIs) related to employee engagement satisfaction, 30% to recognition, and 30% to
can vary based on the specific objectives of the communication, the calculated overall
organization's engagement strategies (Siocon, engagement score would be:
2024; Jay, 2024). Various formulas are utilized to
gauge this metric, including: Overall Engagement Score = (70% x 40%) +
(60% x 30%) + (50% x 30%) = 63%
• Employee Net Promoter Score (eNPS): This
KPI assesses the likelihood of employees This score indicates that the organization's overall
recommending their workplace as a employee engagement level stands at 63%. Using
favourable environment. The eNPS formula is this information, the organization can pinpoint
typically represented as: eNPS = (% of areas needing enhancement and devise strategies
Promoters – % of Detractors) x 100% to boost employee engagement. These strategies
Promoters refer to employees who rate their could include initiatives like implementing an
likelihood of recommending the organization employee recognition program or enhancing
as a 9 or 10 on a 10-point scale. Detractors are communication channels between leadership and

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East African Journal of Business and Economics, Volume 7, Issue 1, 2024
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staff. Measuring employee engagement through encompasses the expenses related to designing,
KPI metrics is crucial for organizations as it helps implementing, and managing various training
gauge employee commitment and emotional programs such as workshops, seminars, e-learning
attachment to their roles and the company. By modules, certifications, and other employee
assessing this metric, organizations can identify development initiatives (Munshi, 2022; West,
areas for growth and implement strategies to 2019; Vulpen, 2024).
elevate employee engagement levels, leading to
This KPI is of significant importance as it aids
improved employee retention, job satisfaction,
organizations in evaluating the efficiency and
productivity, and overall organizational
effectiveness of their training endeavours and
productivity (Eqtble, 2022; Tambe et al., 2019).
assessing the return on investment (ROI) for their
Employee Retention training initiatives. It enables HR managers and
executives to gauge the cost-effectiveness of their
Employee retention refers to an organization's
training strategies, allocate resources judiciously,
capability to keep its employees within a defined
and make well-informed decisions based on data
timeframe. It stands as a critical HR Key
to optimize their training budgets (FactorHR,
Performance Indicator (KPI) as it mirrors the
2024).
success of the organization's strategies in
preserving its skilled workforce, diminishing Cost of Training per Employee = Total Cost of
turnover rates, and fostering stability among its Training / Number of Employees Trained
employees (West, 2019). The significance of
The comprehensive training cost encompasses
employee retention for organizations is
expenses related to the creation, implementation,
paramount, as elevated turnover rates can lead to
and management of training initiatives. This
heightened recruitment and training expenses,
includes factors like trainers' salaries, training
decreased productivity, disturbance in team
materials, software or platforms, facilities, travel
synergy, and a detrimental effect on the
expenses, and associated costs. The count of
organizational culture. Preserving top-performing
trained employees represents the total number of
employees is fundamental for sustaining a high-
individuals who actively participated in training
performing workforce, ensuring seamless
programs within a specified timeframe.
business continuity, and attaining enduring
organizational victory (Munshi, 2022; Ng, 2023). Time to Promotion
Calculation Formula Time to Promotion serves as a crucial HR Key
Performance Indicator (KPI) that gauges the
Employee Retention Rate = ((Number of
average duration employees take to attain a
Employees at the End of a Period – Number of
promotion within the company. This metric
Employees Who Left During the Period) /
carries significant importance as it reflects the
Number of Employees at the Beginning of the
efficacy of the organization's talent management
Period) x 100
and career development initiatives (Jay, 2024). A
This formula computes the retention rate of shorter Time to Promotion can symbolize a
employees within a defined timeframe, typically culture emphasizing growth, development, and
presented as a percentage. acknowledgement, fostering heightened
employee motivation, engagement, and retention.
Cost of Training per Employee
Conversely, a prolonged Time to Promotion may
The average training cost per employee stands as suggest limited career progression prospects or a
a pivotal HR Key Performance Indicator (KPI) sluggish advancement process, potentially
that quantifies the expenditure an organization dampening employee morale and satisfaction
allocates toward providing training and levels (Rani, 2024; Ng, 2023).
development opportunities for its workforce. This

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Time to Promotion = (Total time spent by finances, and productivity (Oluwaniyi, 2024;
employees in their current position) / (Total Khan, 2024). These costs may manifest in both
number of employees promoted) direct forms, such as expenses associated with
recruiting and training a replacement, and indirect
Employee Referral Rate
forms, including lost productivity during the
The employee referral rate serves as a pivotal HR vacancy period, depletion of institutional
Key Performance Indicator (KPI) that assesses the knowledge and expertise, and the potential
proportion of new hires acquired through repercussions on employee morale. To compute
employee referrals. It is derived by dividing the the cost of turnover per employee, the following
number of new hires recommended by current formula is utilized: (Cost of Separation + Cost of
employees by the total number of new hires within Replacement) / Number of Employees (Profitco,
a specified timeframe, then multiplying by 100 to 2024; Ng, 2023).
express the result as a percentage (Ng, 2023;
The "Cost of Separation" encompasses any
Khan, 2024). Employee referral programs are
expenses linked to the departure of an employee,
gaining popularity in organizations due to their
such as severance pay, accrued vacation pay, and
propensity to yield hires of higher quality,
other termination benefits. Meanwhile, the "Cost
enhanced cultural alignment, and increased
of Replacement" includes expenditures associated
retention rates. Consequently, monitoring the
with filling the vacant position, including
employee referral rate enables HR managers to
recruitment, advertising, interviewing, and
evaluate the efficacy of their referral initiatives
training costs (Oluwaniyi, 2024).
and make informed decisions grounded in data to
enhance their recruitment strategies (Ng, 2023; For Instance: Consider an organization with 500
Jay, 2024; Profitco, 2024). employees experiencing a turnover rate of 20%
over a year. Throughout that period, they incurred
The employee referral rate can be determined
$50,000 in separation costs and $100,000 in
using the subsequent formula:
replacement costs. To determine the cost of
Employee Referral Rate = (Number of New Hires turnover per employee, the formula is applied as
from Employee Referrals / Total Number of New follows: ($60,000 + $100,000) / 100 = $1,600
Hires) x 100 This signifies that, on average, the cost incurred to
replace each departing employee within the
For instance, let's consider a scenario where a organization amounted to $1,600. By monitoring
company recruited a total of 40 new employees this metric longitudinally, HR managers can
during a quarter, with 10 of them being referred assess the financial ramifications of employee
by current employees. To compute the employee turnover on the organization and pinpoint areas
referral rate, the given figures are inserted into the necessitating enhancement within their employee
formula as follows: retention strategies.
Employee Referral Rate = (10 / 40) x 100 = 25 % Relationship between HR Metrics and
This implies that 30% of the new hires during that Analytics and Sustainable Work
quarter originated from employee referrals. Environments

Cost of Turnover per Employee Data-driven insights are at the forefront of modern
Human Resources (HR) practices, offering a
The expense of turnover per employee refers to comprehensive view of various aspects crucial to
the financial outlay incurred when an employee organizational success. HR metrics and analytics
departs from the organization and necessitates play a pivotal role in uncovering actionable
replacement. The significance of gauging this information related to employee performance,
metric lies in its potential to significantly deplete engagement, well-being, diversity, inclusion, and
the organization’s resources, encompassing time,

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Article DOI: https://doi.org/10.37284/eajbe.7.1.1976

sustainability. By harnessing the power of data metrics and analytics are instrumental in assessing
analysis, organizations gain valuable insights into and improving DEI initiatives within
their workforce dynamics. For instance, HR organizations. They facilitate the measurement of
metrics can reveal patterns and trends that diversity metrics, identify gaps, promote inclusive
highlight areas for improvement in sustainability practices, and ensure equitable opportunities for
practices within the work environment. This all employees, thus contributing to a more
analytical approach goes beyond surface-level sustainable and inclusive work environment
observations, allowing businesses to make (Profitco, 2024; eqtble, 2022).
informed decisions based on evidence rather than
While traditionally not part of HR metrics,
assumptions (Gurusinghe et al., 2021).
environmental sustainability is gaining
Performance monitoring is another area where HR
importance within HR responsibilities. HR
metrics shine. They enable organizations to
analytics can support sustainability efforts by
monitor and measure employee performance and
tracking employee behaviours related to resource
productivity effectively. This data-driven
conservation, promoting green practices, and
approach is essential for fostering sustainable
aligning HR policies with sustainability goals.
business practices by identifying strengths,
This integration reflects a holistic approach to
weaknesses, and opportunities for enhancing
sustainable business practices, encompassing both
workforce efficiency (Bonilla-Chaves & Palos-
human and environmental well-being. Ultimately,
Sánchez, 2023).
HR metrics and analytics empower HR
Moreover, the use of analytics enhances professionals and organizational leaders with
performance monitoring by providing real-time actionable insights for strategic decision-making.
insights and predictive analytics. This proactive These insights inform resource allocation, policy
approach helps anticipate performance trends and development, training and development
potential issues, allowing HR teams to implement programs, and organizational culture initiatives
timely interventions and optimize outcomes. that collectively contribute to creating and
Employee engagement, satisfaction, and well- sustaining healthy, productive, and sustainable
being are critical pillars of a sustainable work work environments (Oluwaniyi, 2024; Eqtble,
environment. HR metrics related to these areas 2022).
provide quantifiable measures of organizational
CONCLUSION
health and employee morale (Yahia, Hlel,
& Colomo-Palacios, 2021; Yuan, The investigation of critical human resource (HR)
Kroon, & Kramer, 2021; Oluwaniyi, 2024). By metrics and analytics for sustainable work
leveraging analytics, organizations can identify environments using literature mapping and
factors contributing to high engagement levels conceptual synthesis has yielded useful insights
and proactively address risks to employee well- into the strategic significance of HR practices in
being, fostering a positive and sustainable work promoting sustainability within organisations.
culture. Retention and talent management are also The research process included a rigorous
central to sustaining a skilled workforce. HR evaluation of the existing literature, the
metrics on retention rates, turnover, and talent identification of essential HR indicators and
management strategies provide essential data for analytics frameworks, and a conceptual synthesis
strategic decision-making (Fastercapital, 2024; to better understand their impact on sustainable
Belizón, & Kieran, 2022). Analytics further work practices. The literature mapping shows that
enrich these insights by uncovering the drivers of organisations are increasingly recognising the
turnover, predicting attrition risks, and optimizing value of HR metrics and analytics in driving long-
talent acquisition and development efforts. term success. Metrics for employee engagement,
Diversity, equity, and inclusion (DEI) are retention, productivity, well-being, diversity,
fundamental values in modern workplaces. HR equity, and inclusion (DEI), and environmental

258 | This work is licensed under a Creative Commons Attribution 4.0 International License.
East African Journal of Business and Economics, Volume 7, Issue 1, 2024
Article DOI: https://doi.org/10.37284/eajbe.7.1.1976

sustainability have emerged as critical markers of Manpower, 43(6), 1405–1424. Available

organisational sustainability. By leveraging data- from: https://doi.org/10.1108/IJM-12-2020-
driven insights and analytics tools, HR 0548
professionals and organizational leaders can make
Bechter, B., Brandl, B. & Lehr, A. (2022) The
informed decisions, design targeted interventions,
role of the capability, opportunity, and
and cultivate work environments that support
motivation of firms for using human resource
employee well-being and organizational
analytics to monitor employee performance: a
resilience. The conceptual synthesis deepened our
multi-level analysis of the organisational,
understanding of how these HR measurements
market, and country context. New
and data interact and contribute to sustainable
Technology, Work and
work environments. It emphasised the importance
Employment, 37(3), 398–424. Available
of integrated approaches that take into account
from: https://doi.org/10.1111/ntwe.12239
both classic HR measures and modern analytics
tools for addressing complicated sustainability Belizón, M.J. & Kieran, S. (2022) Human
concerns. Furthermore, the synthesis emphasised resources analytics: a legitimacy
the significance of connecting HR strategies with process. Human Resource Management
organisational sustainability objectives and Journal, 32(3), 603–630. Available
cultivating a culture of continual improvement from: https://doi.org/10.1111/1748-
and innovation. This study emphasises the 8583.12417
strategic importance for organisations to prioritise
HR metrics and analytics in their sustainability Ben-Gal, H.C. (2019) An ROI-based review of
efforts. Organisations may develop positive work HR analytics: practical implementation
cultures, improve employee engagement and tools. Personnel Review, 48(6), 1429–1448.
well-being, and achieve long-term organisational Available from: https://doi.org/10.1108/PR-
success through a comprehensive approach that 11-2017-0362
blends HR practices with sustainability concepts. Bhat, A. (2024). Employee Net Promoter Score
This study adds to the growing discussion about (eNPS): What it is + Free Guide. Employee
HR's involvement in sustainability and lays the Net Promoter Score (eNPS): What it is + Free
groundwork for future research and practical Guide
applications in the field.
Bohlouli, M., Mittas, N., Kakarontzas,
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