Metric One: Percent of Internal Hires

Value. The Percent of Internal Hires metric can take advantage of data that you already have but may not have used as a management tool. Measuring the amount of internal transfers that occur is historically the first (and easiest) indicator to calculate. It will give an indicator of how likely an internal candidate will be considered for a position. This is the baseline figure that likely will predict employee attitudes to internal mobility and a culture of considering internal candidates first.

Depending on your business, the magic definition of what is a healthy number for the organization will vary. For example, in retail, most of the workforce may be entry-level, short-term employees. A healthy percentage of internal transfers is probably low. If you are a skill-oriented, intellectual capital focused organization, your fluidity number is likely high.

There are a few different ways of cutting the percentage-of-hires number, including: enterprise-wide, or by specific business area.

Audience. This is a basic statistic that is probably being examined monthly, which is appropriate. Assessing internal hires monthly or quarterly should be helpful when looking at the source of hire metrics.

When one tracks fluidity across the enterprise, one can assess the openness of the company to its own internal labor market. If the percentage of people hired internally is far lower than one would expect for the company type and size, then this data can be used to present new Internal Mobility policies to executives.

Data Elements. The data that you will need are:

• Total number of employees.

• Total number of internal transfer requests.

• Total number of internal transfers (hires).

• Total number of hires.

The Metric. Percent of internal hires = number of internal transfers/number of total hires

Presentation. This metric is simple to produce since it can be taken directly from source-of-hire data. Simply use your internal transfer hire data as the source data.

Comparing Against Goals. Finding meaning in the Percent of Internal Hires is tricky and should be judged against your company’s goals. Organizations with a “promote from within strategy” but a low internal transfer percentage are probably out of sync with their business goals. After setting a baseline on these numbers, consider running the total number of internal applicants against the total number of hires at quarterly intervals to gauge how many employees were not chosen for the hires made in that time period. This may impact employee perceptions of how open the company is operating.