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Actually calculatng ROI on HR Program is a complicated process and most organisations don't produce such type of reports. We can calculate an approximate ROI for incurring costs that are designed to contribute to staff retention, development and recruitment. For example place ROI on the value of a staff medical plan. - what is the cost of the plan? - ask employees to rank the importance of a company mediacl plan; how many your staff think this is important for them. - calculate employee cost to profit (senior employee payroll expense x profit) / total employee payroll - now you have the value of your seniior staff by virtue of what you are paying him. - apply the results of the medical benefits survey. this will provide the influence of the proposed scheme. - consider the cost of replacing the senior staff; recruiting cost. you will have direct correlation between the influence value of your benefit scheme and the cost of saving represented by not incurring recruiting costs. - the difference between both is the ROI which is the expense of the medical benefit scheme that you are going to deliver by virtue of its value.
ROIs have been like myth of all soft side or behvioural based skills, i beleive rather than ROIs we could observe the improvement via improvement in soft and technical skills of HR professioanls and to gauge this improvement, do formulate KPIs.
Key Performance Indicators (KPIs) are one of the main source of gauging the performance of any employee irrespective of the nature and this is the technical side the "How" part is to be reviewd by Appraisal form,as this is also important.
Some of the KPIs for HR are;
1 - # of days taken to fill the position.
2: # of initial interview condcuted to short list the candidates.
3: # of candidates fall in accepted level of performance.
4: To run Employee Satisfaction Survey twice a year.
5: # of hours for training for X number of employees.
There are various kpis via ROI could be monitored because each position has it cost and to perform the job in fair manner is ROI.
Programme benefits / Programme cost.
thank you all, I thing Samar get the point .
ROI = Total Profit - Investment / Invstment * (100% ( For persanteg, with out to numbers of monay ))
thank you