Thursday, September 18, 2008

What Is The Right Ratio? Is This The Right Question?

I was on a flight Wednesday evening. As we were preparing to take off I was chatting with the guy sitting in my aisle. Turns out he is an HR Manager. So before settling down to our individual work we talked "shop." I was floored when he told me that the company he works for has 8000 employees in 80 different locations and he was one of THREE HR managers they have in the company. That is a ratio of 1:2667. His comment to my amazement was "Well obviously we have decided we are not a strategic partner." For the most part they fly around the country putting out harassment and discrimination "fires." He had resigned himself to being the HR detective.

That got me to thinking were things stood on the WHAT IS THE RIGHT RATIO question. Common opinion has mostly been that the "correct" ratio is 1:100, that is 1 HR person for every 100 employees. And I run into this quite often. I have also run into situations of 1:250 and occassionally even larger ratios. The problem with this is that there is no single answer. The answer depends on many factors, such as the nature of the work, nature of the business, philosophy of service delivery, dispersion of employee base, upper management's view of the HR function and how much automation exists in the various HR areas. The nature of the economy also has some influence. As cutbacks occur we see HR departments having to do "more with less" and thus the HR ratio has expanded. I am sure there are other factors that play into this as well.

I am not even sure that the size of the HR department is the proper question. Since there are many ways to "skin the cat" of HR ratio perhaps a better measure(s) would be HR EFFECTIVENESS. What can HR contribute and what is the best way that can be done? Once that is determined then proper staffing can be determined. Here is an interesting discussion on this topic from last year on a blog post at breakpoint HR.

Tell me your story. What is your ratio and what is your contribution? Are you strategic?

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