Is there an ideal ratio when it comes to the size of HR teams in organisations? There are plenty of variables to consider. These include HR’s role in the business, the extent to which ‘HR responsibilities’ are delegated elsewhere, the capability and capacity of those with said responsibilities, and of course, how technology and data are used to support HR functions.

 

In this article, we outline the findings from the CIPD's survey of 1,174 UK-based HR bosses to shed light on HR’s operating model from a technology and data perspective. Respondents were from organisations with 50 or more employees worldwide – the size we’d expect technology like HR information systems (HRIS) to become crucial for keeping track of employee records.

What functions are within the HR remit?

Recruitment (84.2%) and HR systems (81.9%) were most often cited as matters that are within an HR department’s remit (Figure 1). Other commonly selected choices include inclusion and diversity, reward and recognition, employee engagement, performance management, learning and development and onboarding activities.

Figure 1: Activities the HR department oversees in your organisation

While work scheduling wasn’t so high on the list, our data suggests the activity is more commonly overseen by HR in the manufacturing sector (57.7% vs 34.1% overall). Other less popular areas cited as within HR’s remit included internal communications and events, global mobility and employee relations.

When looking at the figures, it is worth bearing in mind that some of the activities may have seen lower numbers because they are being managed by other departments (for example, finance overseeing payroll) or delegated to people managers. It’s also possible that some respondents might not have been aware of all activities their HR departments oversee.

What types of HR software are used for HR tasks?

Here, HR software means any software or platform an organisation uses for HR tasks. This may include programs installed on a work computer or accessed through a web browser.

Figure 2 shows the percentage of HR bosses who said their organisations used certain types of HR software or platforms. Few said they didn’t know whether their organisation had a particular type of HR software – 6% or less for all except reward and recognition (9.5%), people analytics (11.8%) and workforce planning software (12.8%).

Figure 2: HR software or platforms used in your organisation

As expected, most said their organisations have HRIS (84.5%) and payroll software (82.9%). The majority of those who said their organisation didn’t have these came from organisations with 550 or fewer employees worldwide (78.7% and 70% respectively). 

In contrast, fewer HR bosses said their organisation used reward and recognition software or platforms (38.8%). These might be used to do compensation plan modelling or facilitate peer-to-peer recognition schemes for example.  

Similarly, a smaller proportion said their organisations used HR software or platforms for workforce planning (37.1%). Workforce planning is difficult to do well at scale without a software or platform that enables easy access to good quality data. Indeed, separate research from the CIPD found 46% of people professionals saying their organisation did not collect any data in key areas such as: 

  • skill gaps within the organisation and sector 
  • future skills requirements, and 
  • the availability of talent in the market. 

Although recruitment (84.2%) was the activity most cited as overseen by HR (Figure 1), not as many HR bosses (67%) said their organisations used recruitment software (Figure 2). 

What workforce metrics are reported to management? 

Employee headcount change (net 75.1%), employee turnover or retention (net 74.4%), and absenteeism rates (net 73.3%) were the three metrics that most HR bosses said were reported to management, at least monthly or annually.  

In contrast, relatively few said quality or cost of hire, employee commitment, and career path ratio were reported to management (Figure 3). Perhaps this is because these metrics are more difficult to quantify. However, if meaningful definitions can be agreed and the data is relatively easy to collect, then these could also be reported. A good HRIS can support this. For example, the career path ratio is the number of job promotions compared to the number of all movements (lateral and promotions) an employee has had. If all employee role changes are recorded on an HRIS, the career path ratio could be easily calculated and used to track employee career growth in the organisation. This metric could then be used to inform activities to support employee retention and engagement. 

Figure 3: Workforce metrics reported to management 

The percentage of HR bosses who didn’t know whether certain workforce metrics were reported to management was significant, between 10% and 21%. This is even after we’ve excluded from our analysis those who had no knowledge of what workforce metrics were reported to management at all. 

Looking at Figure 4, the findings suggest that workforce metrics were more likely reported to management if the organisation had people analytics software. Reporting was more frequent in organisations with this software than in those without (or without awareness of) the software (compare dark purple bars in Figure 4). 

Figure 4: Workforce metrics reported to management - those from organisations who have vs don't have/don't know if they have people analytics software

Having people analytics software can therefore streamline reporting efforts and increase the types of metrics that can be regularly reported to inform management decisions. Modern HRIS typically have a self-service people analytics feature that allows control over who can view relevant key performance indicators (KPIs) and query subsets of the workforce data themselves. 

What’s the HR to employee ratio in organisations? 

Only 664 of the 1,174 responses we analysed included valid estimates of the number of HR professionals and employees in their organisations worldwide. This is mainly because not everyone knew how many HR professionals their organisations employed. 

Of the 664 responses, the median respondent quoted a global HR to employee ratio of 1:60. For the middle 90% of respondents, the global HR to employee ratio ranged between 1:17 and 1:255. Although Table 1 shows a wide spread of ratios, we can see that ratios of 1 HR professional to more than 255 employees are uncommon.  

Table 1: Global HR to employee ratio

Percentile Global HR to employee ratio
5th percentile 1:17
10th percentile 1:24
25th percentile 1:37
50th percentile 1:60
Mean 1:111
75th percentile 1:100
90th percentile 1:200
95th percentile 1:255

Base: 664 UK-based HR decisionmakers

While these ratios are interesting, they don’t tell the whole story of HR’s value to different organisations. The ideal HR to employee ratio is one that is optimal for an organisation’s success. Although HR can be responsible for a broad range of activities, our research suggests its most common function is recruitment (Figure 1). Having good people analytics increases the types of workforce metrics and frequency of reporting to support and inform timely decision-making. 

In the final article of this series, we’ll delve further into the HR technology that different organisations use and what this means for the people profession. 

The full series

Technology, the workplace and
people management

Our research series explores technology use and its impact on people practice in the physical and digital workplace

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About the author

Hayfa Mohdzaini, Senior Research Adviser | Interim Head of Research

Hayfa joined us in 2020. Hayfa has degrees in computer science and human resources from University of York and University of Warwick respectively.

She started her career in the private sector working in IT and then HR and has been writing for the HR community since 2012. Previously she worked for another membership organisation (UCEA) where she expanded the range of pay and workforce benchmarking data available to the higher education HR community. 

She is interested in how the people profession can contribute to good work through technology and has written several publications on our behalf, as well as judging our people management awards, speaking at conferences and exhibitions and providing commentary to the media on the subjects of people and technology.

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