Organisations will face major challenges in meeting Government-backed recommendations on human capital management reporting if the findings of a new survey are anything to go by.

While most of the 200 UK board directors, senior finance managers and other managers surveyed said they are comfortable with basic HR metrics, few are focusing on broader performance issues, according to the Webster Buchanan Research survey.

It found that 60% of respondents ranked themselves above average at reporting absenteeism rates but only one third claimed to be above average in measuring the business impact of non-attendance, and one third actually ranked themselves ‘poor’ or ‘very poor’.

In addition, only three in ten respondents ranked themselves better than average at reporting on the relationship between compensation and performance, with approximately the same number declaring themselves ‘poor’ or ‘very poor’.

The survey also found that:

• two-thirds of respondents said it was important to improve their use of existing HR reporting tools and applications to raise the quality of workforce reporting

• 81.9% agreed that better co-ordination between HR and financial IT strategies was useful or important, with 58.7% considering it a priority

• one third plan to invest more in workforce-related technology in 2004 compared to last year

• the biggest driver of investment was to improve the quality of management information (81.8%), followed by improving customer service or satisfaction (76.5%) and cost reduction (66.2%).
  

However, less than half of respondents ranked it ‘very important’ or ‘important’ to invest in order to free up HR to focus on “strategic input” – the lowest driver of all.

Commenting on the findings, Keith Rodgers, co-founder of Webster Buchanan Research, said: “Human Capital reporting presents significant challenges for the Finance department, the HR function and the Board of almost every organisation. The ‘Accounting for People’ Report has been a great catalyst for this debate; now organisations need to take a very practical approach to address both the metrics and the IT implications.”

“This survey shows that the concerns HR managers have about their role – a general lack of strategic input into the business as a whole – are shared by the board,” said Malcolm Aldis, Managing Director of Northgate Information Solutions’ HRS division.

He continued: “Once the appropriate mechanisms are in place, it’s relatively easy to provide high quality information on HR statistics. As soon as businesses are aware of this, it should only be a matter of time before HR is able to provide the kind of valuable information required to meet the ‘Accounting for People’ report recommendations.”

Further results from this survey will be presented at HR Futures on 30 March in London, as part of the ‘Human Capital Debate: Getting the Balance Right’. For more information on this exclusive HR forum, sponsored by HR Zone, click here