KPIs: Measuring the right thing

KPIs: Measuring the right thing

Given how much money organizations are spending on employer branding, it’s interesting to see how well key performance indicators (KPIs) measure those efforts. We found most KPIs focus on internal indicators (e.g. retention and new-hire quality) and very few focus on external indicators (e.g. external rankings or external brand perception).

The top three KPIs today are all inward-facing: average retention rate (used by 46 percent), new hire quality (45 percent) and employee engagement level (45 percent).

External indicators like rankings and brand perception all registered under 20 percent of respondents today, but show modest improvement in five years. These findings are surprisingly low
given the importance of external indicators for measuring employer brand strength. Third-party rankings often reveal insights and opinions that brands cannot otherwise access. Similarly, measuring external brand perception is a key competence, but few brands are doing it today. Even “measuring ROI of employer branding activities” was chosen by only 13 percent today, an exceptionally low number given the expertise and tools available in most marketing departments to achieve it.

What is perhaps most startling is that many important KPIs – such as average retention rate – are being measured today by less than half of respondents and will not be measured by any higher share in five years either. When asked what will be important in five years, respondents choose fewer indicators. Is this a case of a lack of clear goals? Or a lack of confidence about what will matter in five years?

An interesting side note: 28 percent say they use average number of applicants per year as a KPI but only 16 percent expect to use it in five years – a welcome sign given this indicator often does not show the level of enthusiasm for a company, but only a poor job description that netted too many unqualified candidates.