From Red Flags to Green Lights: How HR Metrics Can Help You Build a Better Future 🚩🟢🌅

As companies strive to remain competitive in an ever-changing business environment, it's important to be aware of the signs that something might be wrong. Here are fifteen signs that your company might be in trouble, and how a financially savvy HR professional can use their knowledge of HR metrics to make a difference.

Too much focus on day-to-day activities versus creating the future.

When a company is focused solely on the present, it's easy to lose sight of the future. One can use HR metrics to demonstrate the impact of investing in future-focused initiatives, such as employee development and innovation programs, on the company's financial performance.

A lack of real purpose, no passion among employees

Companies that lack a clear purpose and fail to inspire passion among employees are likely to struggle with engagement and retention. By aligning HR metrics with financial ratios, HR professionals can demonstrate the impact of investing in purpose-driven initiatives on the company's bottom line, such as employee wellness and social responsibility initiatives.

More talk about digital transformation than corporate transformation

While digital transformation is important, it's not the only transformation that companies need to focus on. A professional can use HR metrics to demonstrate the impact of investing in broader transformation initiatives, such as leadership development and culture change, on the company's financial performance.

Corporate values are perceived not true and they don't align with future

When a company's values are not aligned with its future goals, it can create confusion and disengagement among employees. A financially savvy HR professional can use HR metrics to demonstrate the impact of reinforcing the company's values and aligning them with future goals on the company's financial performance.

Execution rules-too little focus on building organizational capabilities

Without a focus on building organizational capabilities, companies can struggle to execute their strategies effectively.  HR metrics can be used to demonstrate the impact of investing in employee development and capability-building initiatives on the company's financial performance.

Metrics are based on outcomes, not behaviors

When metrics are based solely on outcomes, companies may miss opportunities to improve employee behaviors that can lead to better outcomes. A financially savvy HR professional can use HR metrics to demonstrate the impact of investing in behavior-based initiatives, such as performance coaching and recognition programs, on the company's financial performance.

Too little focus on new and emerging industries

As industries evolve, companies must be able to adapt to remain competitive. You can make can use of HR metrics to demonstrate the impact of investing in initiatives that focus on emerging industries and new technologies on the company's financial performance.

Core capabilities are not deployed to enter new growth markets

Without leveraging core capabilities, companies may struggle to enter new growth markets successfully. A financially savvy HR professional can use HR metrics to demonstrate the impact of developing and leveraging core capabilities on the company's financial performance.

Middle managers stop innovation, transformation just by doing their jobs

Middle managers play a critical role in driving innovation and transformation, but they can also hinder progress if they are not aligned with the company's goals. You can make can use of HR metrics to demonstrate the impact of investing in leadership development and alignment initiatives on the company's financial performance.

Innovation is an R&D activity led by old school CTO.

Innovation is not just the responsibility of the research and development department. A professional can use HR metrics to demonstrate the impact of investing in innovation initiatives across the organization on the company's financial performance.

HR is absent in the context of innovation

HR professionals should play a key role in driving innovation by developing and implementing talent management initiatives that foster creativity and innovation. A financially savvy HR professional can use HR metrics to demonstrate the impact of investing in innovation-focused talent management initiatives on the company's financial performance.

You have councils and committees for everything

While councils and committees can be useful, they can also slow down decision-making and hinder progress. You can make can use of HR metrics to demonstrate the impact of streamlining decision-making processes and investing in initiatives that prioritize speed and agility on the company's financial performance.

You do all the right things, for the past and not for the future

Companies that focus solely on past successes may be missing opportunities to prepare for the future. You can make can use of HR metrics to demonstrate the impact of investing in future-focused initiatives, such as employee development and innovation programs, on the company's financial performance.

Strategy takes place at the top, behind closed doors or at resort areas once a year

Without involving employees at all levels in the strategic planning process, companies may struggle to execute their strategies effectively. A financially savvy HR professional can use HR metrics to demonstrate the impact of involving employees in the strategic planning process and investing in initiatives that prioritize employee engagement and alignment on the company's financial performance.

Innovation is run by a department, not across the organization

Innovation should be a company-wide effort, not the responsibility of a single department. You can make can use of HR metrics to demonstrate the impact of investing in innovation-focused initiatives across the organization on the company's financial performance.

In conclusion, financially savvy HR professionals can use their knowledge of HR metrics to make a difference in a variety of scenarios. By aligning HR metrics with financial ratios and metrics, HR professionals can demonstrate the impact of their programs and initiatives on the company's financial performance, and secure additional resources and support from senior leadership. If you're looking for more guidance on the link between HR metrics and financial ratios, check out my book, which provides practical advice and strategies to help HR professionals navigate this critical connection and build for the future.