No More Fuzzy Numbers


As Seen in CFO Studio Magazine Q1 2017 Issue

Monetize talent-related growth strategies

-BY ALDONNA R. AMBLER, The Growth Strategist


Being able to attract, engage, and retain top talent is an important growth strategy of young or realigned companies. Yet most organizations still struggle when talent-related investments are involved because the discussions generally rest on vague information (fuzzy numbers).

Think about what happens when the CFO tries to get quantifiable answers to these HR questions:

  • How can we tell if a stay bonus was necessary?
  • Do career development programs pay off or are we just training people to leave and be productive at competing companies?
  • What degree of fit with our corporate culture does a job candidate need to be hired?
  • How can we tell if an employee is sufficiently engaged?
  • How much should our business invest if the typical millennial only stays with an employer a few years?
  • How much turnover is acceptable to us?
  • How do we know if we should be utilizing outside search firms or building our own recruitment department?
  • How much progress do we lose when key position vacancies linger?

Where You Can Start

The Society for Human Resource Management (SHRM), which provides professional certification for human resource professionals, leads the improvement of talent-related measurement, but there is a long way yet to go.

It pays to help your company’s HR professionals generate talent-related ratios to convey their proposed approaches to achieve your goal-related ratios. With such ratios in place, when your HR department wants to invest in a new engagement program, as CFO you can monitor its impact on retention, productivity, and capacity utilization.

Examples of Talent-related Ratios:

$___ cost for recruitment, screening, selection, onboarding/hire

$___ cost for engagement and retention/employee

$___ cost for incentives and bonuses (above base salary or wages)/ employee

#___ average months or years with our company/employee

%___ job vacancies OR %___ capacity

Examples of Company Growth-related Ratios:

% ___improved capacity utilization

$ ___ productivity increase

%___ reduction in people-related operating costs/gross revenue

Increasingly, HR directors must be involved in the process of monetizing desired outcomes. It makes sense to establish realistic baselines for talent-related ratios now, or your company’s decisions revert to fuzzy numbers, and your truly major investment decisions will be based on wishes, hopes, and guesses.



Copyright 2017