HR Benchmark Survey 2020 Results
After continuously hearing that HR struggles to find time for strategic work, we wanted to gather data that would help HR leaders build a business case for more resources and “by George I think we’ve done it!”
We took a different approach to the traditional benchmark surveys that only analyze the current state data. We think that approach is flawed when the entire HR profession seems so understaffed. So, we also asked HR leaders to provide self-analysis through two key questions:
1. Are you adequately staffed in HR?
2. If not, how many more HR FTEs do you need to be adequately staffed.
The results showed that the understaffed HR leaders have a very good idea of the resources they need in order to have more time to be strategic:
- Those who felt they are “not adequately staffed” stated on average they needed 15% more staff and as much as 49% more for small companies.
- No surprise the “not adequately staffed HR functions” are supporting 16% more FTEs than their “adequately staffed” peers and 40% more for smaller companies.
When looking at the HR Ratios, in every size company except the upper mid-market the HR functions that rated themselves as “adequately staffed” had higher HR ratios than their counterparts who stated they were “not adequately staffed”.
The reason the upper mid-market with lower ratios and, still considered themselves “under-staffed” is because they had almost 5x more hiring than their “adequately staffed” counterparts.
There was a large gap in HR ratios between small and jumbo companies with a certain threshold needed for smaller companies to even get in the game and jumbo companies clearly having more economies of scale.
As you can see in the graph above, the smaller companies that are “adequately staffed” had an HR ratio that’s almost 2x that of their “not adequately” staffed counterparts.
Respondents told us the top challenge is HR Organizational Efficiency:
If your team is spending time on low value transactional tasks that can be automated such as; pulling data (you don’t have confidence in) from antiquated systems or multiple systems and no time to invest in HR team skills… you’re not alone!
HR organizational efficiency was composed of these sub-categories:
- HR team’s skills
- Lack of HR process
- Lack of more self-service model
- HR optimization
- HR’s reputation and seat at the table
Here are a few tips from the top to deal with HR Organizational Efficiency:
- “There is no Glory in the Ordinary”
One of my favorite sayings is from our Mastermind Member Billy Parsons, CPO of U.S. Dermatology Partners:
“there's no glory in the ordinary, getting data correct in the HR function, the HRIS and payroll or whatever systems you have access to or that you control. Those are transactional, there's no glory in that because you're expected to do that anyway. Nobody cheers when you get it right. You're supposed to get it right. We’ve got to get past all that. The only way we can get past that so we can obtain "the glory" is you have to nail down the processes so that they take less time, they're more efficient more effective...”
He also goes on to say that you’ll have to invest extra hours and recommends ways to leverage your staff while providing development opportunities.
- It’s Hard to Plug the Holes in the Boat While Rowing It
There is no shame in proposing outside help…
Recently, I spoke to a COO new in his role and has HR reporting to him. He discovered that the COVID-19 pandemic revealed a lot of gaps in the HR function. This caused him to decide to hire outside consultants to accelerate the process improvements needed in HR. He knows that having the HR team trying to plug holes in the boat while rowing wouldn’t get them where they need to go.
My question is…Why did it take a non-HR executive to finally make this proposal? The COO took the lead when HR should have
- It Takes Courage to Build a Business Case and Make the Ask
If you don’t someone else will…
The CPO of Jack Henry & Associates, Tiffany Haynes said this about corporate courage in a member only lesson:
“courage isn't static. It's dynamic. So, in every conversation that you have, big or small, you're either moving towards courage or you're moving towards being a coward…. You're either being courageous, or you're being a coward. There's no real middle ground, if we're honest with ourselves.”
Other Top Challenges for HR Functions (prior to the COVID-19):
However, during the pandemic it was obvious the category of “Compliance and Core HR” jumped dramatically and we have a COVID-19 Survival Kit (link to resource sheet) if you haven’t seen it yet but in normal times it was the lowest area of concern.
So how do you use this survey data?
If you need more staff…
1. Compare your ratios to the benchmark data for your size company and then use it as part of your proposal for more resources.
2. Review the list of resources to help you build this case. Some of the lessons are on our public website and others are for members only.
If you are adequately staffed and are more focused on your HR functions organizational efficiencies, you will find the same resource list helpful. And if you have helpful tips for others on how you made the business case for the right number of resources, we’d love to hear from you.
To get the full flavor of the Benchmark Survey take the following steps:
Non-Members:
1. Watch the video for full report:
https://www.chropartners.com/blog/hr-benchmark-survey-2020
2. Enter your info here to get access to a PDF transcript & resources:
https://www.chropartners.com/lp-vlog_BenchmarkSurveyResults
3. If you haven’t already joined our national HR Circle Monthly Members Zoom Call don’t miss the chance meet Amy Messersmith, CHRO of US Anesthesia Partners, on the June call, where she will speak on How to Position Strategic HR. Learn more here:
https://www.chropartners.com/HRCircle19a
HR Mastermind and HR Circle Members Only Login:
For access to Benchmark Survey PowerPoint, video, transcript and resource sheet use the link below to log into your membership portal and scroll down to the Bonus Content section to find “Results of HR Benchmark Survey 2020”.
https://www.chropartners.com/login
As an HR leader there never seems to be enough time in the day. And now with an added layer of pandemic work, it’s more challenging than ever. To stay above water, it’s even more important to get our HR house in order so that we can serve those that depend on us and get to the more strategic work that drives top-line growth.
Demographics About The 299 Respondents:
- Size of Company:
In terms on employee headcount
- Small companies (under 500) = 47%
- Lower Mid-Market (500-999) = 15%
- Upper Mid-Market (1000-4999) = 20%
- Large Companies (5000-9999) = 9%
- Jumbo Companies (10,000+) = 9%
- Total FTEs at 299 respondents’ companies = 947,719
- Small companies (under 500) = 3%
- Lower Mid-Market (500-999) = 3%
- Upper Mid-Market (1000-4999) = 15%
- Large Companies (5000-9999) = 19%
- Jumbo Companies (10,000+) = 60%
- 20 Industries responded
- Level of respondents:
- CHRO/CPO = 18%
- VP = 23%
- Director = 35%
- Manager = 15%
- Individual Contributor = 9%
- 69% reports to the CEO
- Total HR Headcount of 299 respondents= 7404
- 49% have California employees
- 39,607 locations
- 55% outsource payroll
- 25% had over 30% new hires a year
- 64% have a “High Touch” HR model vs self-service
We calculated two commonly used ratios in the industry:
- #FTEs/HR Staff Ratio = [(FTEs – HR Staff)/HR Staff] with typical industry target around 100 employees/HR Staff
- HR ratio = [(HR Staff/Total FTEs) x 100] with typical industry target of 1.0
P.S. If you haven’t already joined our national HR Circle Monthly Members Zoom Call don’t miss the chance meet Amy Messersmith, CHRO of US Anesthesia Partners, on the June call, where we have live Q&A on her pre-recorded lesson "How to Position Strategic HR"
Learn more here:
https://www.chropartners.com/HRCircle19a
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