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        HR Metrics That Matter: Why Your Turnover Rate Isn’t the Whole Story


        HR Metrics That Matter: Why Your Turnover Rate Isn’t the Whole Story
        7:09

        Turnover rates have taken center stage in workforce discussions, often being the first metric leaders request when assessing the state of the workforce. Yet, in isolation, turnover is one of the least understood indicators we have. Relying solely on turnover is like driving a vehicle using only your side and rearview mirrors; you’re reacting to what has already happened, without a clear view of what lies ahead. While turnover shows us that employees are leaving, it doesn’t reveal why they’re departing, what the impact is, or how it ties into larger workforce issues. Sometimes, it doesn’t even matter in the way we traditionally think it does.

        As leaders, we often report a series of metrics out of habit—cost per hire sounds strategic, but it doesn’t often lead to insights about long-term performance or retention. Metrics like applicant conversion and offer acceptance rates reflect process efficiency and miss the crucial element of employee fit and potential. Even metrics like time to productivity provide only a snapshot without delving deeper into the real story. And while engagement scores are popular, they can mask underlying issues and may be manipulated to present a more favorable picture.

        These metrics aren't inherently flawed; they’re foundational building blocks. However, we often treat them like rigid puzzle pieces, assuming there’s only one way to arrange them, locking us into narrow thinking. Instead, we need to adopt a mindset of possibility. What if our metrics were like building blocks—valuable individually yet capable of forming countless structures based on our goals? Dashboards and reports can serve as a starting point, but true strategy requires us to remix and reimagine our data continuously to reflect the current landscape.

        So, what should we be focusing on? The answer is unique to each organization and its goals. If the aim is to foster a workforce that can grow, adapt and thrive in a dynamic environment, we need to prioritize metrics that reflect that reality instead of simply relying on what’s readily available.

        For instance, learning agility is crucial in today’s fast-paced world. Rather than tracking course completions, what we truly need to know is who among our workforce can adapt and succeed when change occurs. Conducting skill gap analyses shifts our focus from merely cataloging employee skills to aligning them with our business needs. Identifying where our talent gaps are doesn’t just show us risk—it unveils potential opportunities.

        Measuring workforce resilience goes beyond assessing stress levels. It’s about understanding how individuals and teams adjust—or fail to adjust—to change. Are we genuinely rewarding adaptability, or are we silently burning out our most reliable employees? Furthermore, discussing productivity at work location isn't just a debate about remote versus in-office; it’s about identifying how and where work flows most effectively to empower teams across various settings.

        Employee well-being remains non-negotiable; you cannot build a high-performing culture on a foundation of burnout. And with the rise of artificial intelligence (AI), it’s essential to track how fluently employees engage with AI-driven tools. The focus should be on readiness and empowerment, not just usage statistics.

        When metrics are viewed in context rather than isolation, they provide a more complete, actionable narrative. Imagine layering turnover rates with skill gap trends, employee well-being indicators and performance patterns to tell a compelling story that prompts meaningful action. Even payroll data, often seen as transactional, can reveal significant insights when examined in context. In a previous analyst perspective, I illustrated how payroll systems could serve as a hidden source of people intelligence.

        Unfortunately, many HR systems are not designed to think for us; they mirror our priorities instead. Dashboards and default reports should be seen as starting points, not end results. Regardless of the sophistication of your software, insights don’t magically appear—it requires thorough analysis and reflection. You need to determine which metrics truly matter, how they’re connected and what actions need to be taken based on those insights. This isn’t a task a provider can do for you, nor is it something you’ll discover on a generic "top KPIs" list.

        In an analyst perspective written last year, I highlighted how a well-structured HR software stack can only yield effective insights if it is backed by thoughtful strategy. ISG_Research_2025_Assertion_HCM_5_Prescriptive_People_Analytics_SThe expectations surrounding people analytics are shifting. By 2027, it’s estimated that two-thirds of organizations evaluating people analytics will seek actionable insights that are easy to digest—both visually and audibly—not just displayed on cluttered dashboards. The demand for deeper, accessible insights is only going to grow, and to meet this challenge, HR teams must evolve from default reporting to intentional design.

        Every organization has a unique story, and metrics should reflect that narrative. There is no one-size-fits-all dashboard that encapsulates your culture, challenges or aspirations. Now is the time to stop treating metrics as static reports and start leveraging them as strategic tools for alignment, insight and meaningful change.

        This journey isn't about acquiring flashy platforms or enlisting a team of data scientists. It’s about cultivating an honest environment concerning what you choose to measure, what metrics you might be neglecting, and whether the data narrative you present aligns with what your organization truly needs. Sometimes, the hardest metrics to relinquish are those we’ve always reported, even if they’ve never genuinely moved the needle.

        We also must consider the human side of this shift. Who needs to change their mindset to welcome this new approach to measurement? Is it the executive team clinging to outdated scorecards, managers who struggle to translate data into action or the HR team questioning whether their efforts are seen? The shift must begin with leadership that is willing to rethink these ingrained behaviors.

        Wherever you begin, just start. Take a fresh perspective and ask yourself: if you could measure anything—without limits—what would you want to know about your people and culture? Then, turn to your software and ask: can you support me in uncovering these insights?

        At the end of the day, the metrics that matter are the ones that challenge your thinking, deepen your understanding and propel your organization forward. They’re ready for you—waiting just beyond the confines of the standard dashboard.

        If you're considering rethinking your software stack as part of this metrics evolution, I’ve published several research-backed Buyers Guides for payroll and HCM technology. These resources may help you assess what’s possible and what to keep an eye out for in your next solution.

        Regards,

        Matthew Brown

        Matthew Brown
        Director of Research, Human Capital Management

        Matthew leads the expertise in HCM software and guides HR and business leaders with over two decades of experience. His research covers the full range of HCM processes and software including employee experience, learning management, payroll management, talent management, total compensation management and workforce management.

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