Post on 12-Apr-2017
Theo Veldsman and Penny Abbott
Context of development of HC Measurement Model: SABPP HR Standards and Audits
Context of development of HC Measurement Model: SABPP HR Standards and Audits
Context of development of HC Measurement Model: SABPP HR Standards and Audits
Through these interlocking initiatives, we can become a talent driven
country
Design team
Anthea SaffyAnglo American Platinum
Deon Pieterse ARMElsabe Bell BritehouseGerhard Olivier HebronGregory Lee WBSIan Rothmann AfriforteIna Rothmann AfriforteMaropeng Sebothma SARSMmabethe Baloyi EOHMpho Magau UJPaul Pretorius HebronPenny Abbott SABPP
Reuphillan KasselmanForte Advisory Services
Rita van Kraayenburg ARMTheo Veldsman UJTracy Harper EOHZia Attlee Knowledge Resources
“Intelligence”
Attaining information of value
Why do we need better Human Capital intelligence?
People play central role in knowledge economy
Disruptive innovation through people is key to sustainable
future
We continue to question return on investment in our human
capital - we need to know if we are a going concern in relation
to people dimension of our organization
Without good intelligence, one cannot make good decisions:
are we improving, are we allocating resources properly, are we
focusing energy and money on right things, how do we
compare?
Having a HC Measurement Model is:
Good practice discipline for all South African employers in same way as financial,
risk management and other such frameworks
Intended to encapsulate “state of the nation” in human capital terms at national,
organisational and operational levels
Based on clearly defined measurement domains
A guiding and aspirational framework, which can be customized/localized to fit
different sectors and/or strategic directions by assigning different weightings to
measurement domains
Intended to enable all employers to measure, and therefore understand, critical
aspects of their human capital in order to implement their organisational strategies
and objectives successfully and effectively
Vision for HC Measurement Model
NATIONAL
Human Capital Confidence Index – is SA “a going concern” in terms of Human Capital?
ORGANISATIONAL/ ENTITY
OPERATIONAL
Three levels of HC Reporting
Board Level Human Capital Report – is our organisation “a going concern” in terms of Human Capital?
Management reporting on core metrics along the HC Value Chain (HR Management Standards)
Value of using HC Measurement Model
Simplifies complexity of measurement components and, over
time allows for establishing connections between them
Enables us to talk same language
Informs HC discussions by explicating mental model and
guides conversation to focus on right things
Enables comparability
Design specification for HC Measurement Model
Each measurement domain should clearly link to performance and enable evidence
based decision making
Reporting should always be on comparative basis, internal or external, against past
periods or against appropriate benchmarks to give “norms” or “targets”
Metrics should be highly focused on few key metrics (80/20 principle)
Metrics reported at higher levels should follow clear “drill down” hierarchy to
metrics at lower levels
Allow for predictions and “What Ifs”, allowing one to take pro-active actions
Follow integrated reporting principles
Five HC Measurement Domains
INPUT
•Human Capital Availability
INPUT
•Human Capital Wellbeing
ACTIVITY
•Human Capital Cost, Investment and
Growth
OUTPUT
•Human Capital Contribution
OUTCOME
•Human Capital Wealth Creation
1
2
34
5
BUSINESS MODEL OF GLOBAL INTEGRATED REPORTING INITIATIVE
(GIRI)
Outcomes measure quality and impact of outputs
Outputs are measurable value added to organisation as result of effective human capital processes and activities (combination of inputs and activities)
Activities convert human capital inputs into valuable outputs through human capital processes and actions
Inputs are basic components of human capital resources measured through fundamental data about workforce
Supporting
excellence in
Human Capital
Management
through sound
measurement
and analysis
Domain Definitions
INPUT
•Human Capital Availability
INPUT
•Human Capital Wellbeing
ACTIVITY
•Human Capital Cost, Investment and
Growth
OUTPUT
•Human Capital Contribution
OUTCOME
•Human Capital Wealth Creation
1
2
34
5Supporting
excellence in
Human Capital
Management
through sound
measurement
and analysis
Right people available at right time to do job, relative to
present and future requirements of organisation
State of work-related health and well-being of
employees.(WHO 7 components of
wellness)
Resources allocated / activities undertaken to build and
maintain employees’ ability to deliver against requirements
People producing measurable value add to
performance, innovation and success of organisation.
Impact of Human Capital outputs on stakeholders
Context matters
Cycle of measurement and reporting takes place within internal and external context
Internal context is shaped by organisational strategy and design
External context is shaped by various drivers, e.g.:Legislation
Governance standards
Socio-economic-political-cultural trends
Research driven evidence in the HR Management profession
Therefore metrics chosen must be appropriate for context. Set of metrics in this framework need to be appropriate to South Africa
However, domains of measurement remain constant across contexts
National Human Capital Confidence Index
Human Capital Availability (Input)
• What is match of supply and demand of economically active people (skilled and unskilled) in country?
• Where are specific under-supply and over-supply situations?
Human Capital Wellbeing (Input)
• What health and wellbeing issues impact on general productivity potential of economically active population?
National Human Capital Confidence Index
Human Capital Cost, Investment and Growth (Activity)
• What are we doing in terms of learning and development in school and post-school education system?
• How much are we spending on whom for what in post-school education system?
• What are we doing and how much are we spending on job creation efforts?
• What health and wellbeing interventions are having positive impacts on productivity?
Human Capital Contribution (Output)
• How productive is employed population?
• What is level of innovation?
Human Capital Wealth Creation (Outcome)
• How do different sectors of the employed population share in wealth created in the country?
• How attractive is country to international talent?
Board level Human Capital Index
Human Capital Availability (Input)
• Do we have the skills we need to execute our strategy?
• Do we have people who can fill critical roles in the planned future?
Human Capital Wellbeing (Input)
• What is the state of health and wellbeing of our employees?
• Have we identified and are we dealing with critical health and wellbeing risks among our employees?
Board level Human Capital Index
Human Capital Cost, Investment and Growth (Activities)
• What are we prioritizing in terms of the human capital value chain relative to our strategic priorities?
• What are we spending/investing on these activities and how is this allocated across various employee groupings?
Human Capital Contribution (Output)
• What is the level of performance overall of employees and of different employee categories?
• What impact do learning and development interventions have on the overall competence of the workforce?
• Do employee innovations add value & support/challenge our strategic direction?
• How does our human capital contribute to our customer satisfaction levels?
• Do we comply to legislation – for example, Occupational Health and Safety, Employment Equity?
Board level Human Capital Index
Human Capital Cost, Investment and Growth (Activities)
• What are we prioritizing in terms of the human capital value chain relative to our strategic priorities?
• What are we spending/investing on these activities and how is this allocated across various
• employee groupings?Human Capital Contribution (Output)
• What is the level of performance overall of employees and of different employee categories?
• What impact do learning and development interventions have on the overall competence of the workforce?
• Do employee innovations add value and support/challenge our strategic direction?
• How does our human capital contribute to our customer satisfaction levels?
• Do we comply to legislation – for example, Occupational Health and Safety, Employment Equity?
Board level Human Capital Index
Human Capital Wealth Creation (Outcome)
• How have we grown our intangible assets?
• What is our image/reputation as an employer?
• How fulfilled are our employees?
• Do the stakeholders feel that they share fairly in our wealth creation?
Where to from here?
VALIDATE MODEL
OPERATIONALISE– SET UP DATA
COLLECTION AND REPORTING
MANAGEMENT SYSTEM
BUILD TECHNOLOGY
PLATFORMROLL OUT
Where to from here?
POTENTIAL TIME LINES
• FIRST NATIONAL HC CONFIDENCE INDEX REPORT
JANUARY 2017
• BOARD LEVEL REPORTING PACKAGE MID 2016
• OPERATIONAL REPORTING PACKAGE MID 2016
• BENCHMARKING SYSTEM ON STREAM JANUARY
2017
Conclusion
An effective HC Measurement Model
will give us an accurate, timeous
people intelligence to become world
class in human capital management at
national, organisational and operational
levels