Systems – 2010
SHORT REPORT
April 2011
HR Benchmarking is the comparison of the quantitative and qualitative indicators of a company’s HR management system with the same indicators from other companies.
Benchmarking is a handy tool for:
planning headcount and personnel costs;
assessing the effectiveness of HR management processes and the return on investment in human resources;
making decisions that optimize personnel costs.
In April 2011 KPMG published the results of a benchmark study on HR management systems – 2010 (hereinafter, “HR Benchmarking”), that KPMG conducted from November 2010 – February 2011. HR Benchmarking data from October 2009-September 2010 was gathered.
All participants in the study operate in Russia and were drawn from various sectors.
About 100 quantitative and qualitative indicators covering the main aspects of HR management systems were analyzed:
financial and statistical data;
headcount and support functions’ responsibilities (HR, finance); compensation and benefits;
recruitment and onboarding; training and development;
company’s image and corporate culture.
Banks 32% FMCG 26% Pharmaceuticals and Medical Products 15% Metallurgy 12% IT 9% Insurance 6% Sector
General results of the Benchmark study
Financial and statistical data
This section covers basic HR department measures: personnel headcount and turnover, total personnel costs and the costs of main HR budget items.
Personnel costs
Personnel costs were categorized as payroll, benefits, learning and development, recruitment and labor safety costs. The majority of personnel costs came from payroll – 93.26%. All other costs were significantly lower: benefits – 4.24%, training and development – 0.72%, labor safety – 0.06%, and recruitment – 0.32%.
Personnel turnover
The most common cause of turnover in 2010 was dissatisfaction over salary level. The second most common cause of turnover was personal reasons (HR Benchmarking-2009 results revealed “career and professional growth” as the second most common cause). Other reasons given included intention to change scope of activity, location of the office and lack of communication (for example, conflict with the management).
The rate of involuntary turnover (separations initiated by the employer) was 5.56% for all companies. 93.26%
4.24%
0.32% 0.72% 0.06%
Payroll Benefits Recruitment Training and development
Labor safety Personnel costs structure
Headcount and support functions’ responsibilities
In this section we analyze the headcount and responsibilities of HR and finance departments.
HR function
According to HR Benchmarking results, in most cases (82% of all survey participants) the HR director was subordinate to the general director and participated in managing the company (68% of all survey participants). Considering HR headcount by process (as percentages of the total HR headcount), we should mention that
personnel records and pensions administration had the largest headcount (20.59%). There were also a significant number of HR business partners in large companies.
For all sectors, the HR headcount ratio was higher than the finance headcount ratio (excluding Metallurgy).
Finance function
According to HR Benchmarking results, accounting and tax specialists made up the largest part of the headcount (45.45%). Financial control and analysis’s head count was lower (7.58%) and budgeting’s
headcount followed (6.94%).
70 71
46
41
75
24 21 23
53
24
All participants FMCG Pharmaceuticals and Medical
Products
Metallurgy Banks
HR and finance headcount ratio
(number of employees, by sectors)
Compensation and benefits
Salary reviews
Most of the participants (73%) reviewed salaries on an annual basis; 68% of them reviewed salaries according to a company plan for all employees.
88% of HR Benchmarking participants increased salaries in 2010. The average number of employees whose salaries were increased was 95-100%. The average rate of increase was 9–23% for the different categories and function areas.
85% of HR Benchmarking participants plan to increase salaries by 8–15% in 2011.
Benefits
The most widespread benefit in 2010 was health insurance (88% of all HR Benchmarking participants). Other widespread benefits included mobile phone compensation (82% of participants), welfare assistance (76% of participants), corporate cars (68% of participants) and life insurance (53% of participants).
Recruitment and onboarding
In this section recruitment and onboarding (adaptation) figures were analyzed. The data includes information on the total number of vacancies filled, the number of vacancies filled by recruitment agencies and the cost of closing one position by in-house recruiters.
Recruitment
According to results of 2010 HR Benchmarking, for each recruiter there were 109 job openings. The number
of vacancies filled was91.04% of total vacancies. The cost of closing one position by in-house recruiters
in 2010 was RUB10 242.
The highest number of vacancies was filled by external candidates (90%), and just 10% were filled by internal candidates. The results do not reach the best practices levels (30–40%).
The number of vacancies filled by recruitment agencies was less than 2%. The highest value was in Pharmaceuticals – more than 26%.
Onboarding
68% of survey participants conducted induction training for new employees. The number of induction training hours per one employee was 3 hours.
Training and development
In this section we analyzed training and development figures, such as the number of employees who received training, number of training hours per employee, positions filled by succession and the number of participants in talent pools.
Training
In 2010, 62% of employees were trained. The number of training hours per one employee in 2010 was 10 hours.
Career and succession pool
85% of HR Benchmarking participants had formal criteria for promoting employees. The average number of employees promoted in 2010 as % of total headcount was less than 7%.
A separate part of the survey was devoted to special development programs, particularly succession and talent pools. Among survey participants succession pool programs were more popular than talent pool programs (41% of survey participants had succession pool programs and only 29% had talent pool programs).
Performance appraisal
Performance appraisal methods vary greatly by area of use: competence-based interviews are most commonly used for recruiting and selecting candidates (47% of participants), knowledge checks and testing for training (47%), performance appraisal for career development (50%), compensation (71%) and evaluating candidates for talent and succession pools (32%).
61.58%
47.17%
83.97%
70.08%
79.49%
All participants FMCG Pharmaceuticals and Medical
Products
Metallurgy Banks
Employees received training as % of total headcount in 2010
Company’s image and corporate culture
Programs to develop companies’ images have lately become an important aspect of companies’ corporate policies. According to HR Benchmarking results, 88% of participants practiced sponsorship and/or charity, and 62% used employer branding programs in 2010.
About 76% of companies regularly conducted employee satisfaction surveys, while 15% conducted them once a year.
Full HR Benchmarking report: purchasing options
Option 1. Single sector report
Analytical file (pdf), including characteristics of HR Benchmarking participants and survey key findings.
Benchmarks for one of the sectors (statistical data in “mean, median, 25-th percentile and 75-th percentile” format, Excel file).
Price – RUB20 000, VAT not included.
Option 2. Report on all sectors
Analytical file (pdf), including characteristics of HR Benchmarking participants and survey key findings.
Benchmarks for the whole market and all sectors (FMCG, Pharmaceuticals and Medical Products, Metallurgy, Banks), in “mean, median, 25-th percentile and 75-th percentile” format (Excel file).
Price – RUB30 000, VAT not included.
Option 3. Report containing your Company data
Analytical file (pdf), including characteristics of HR Benchmarking participants and survey key findings.
Benchmarks for the whole market and all sectors (FMCG, Pharmaceuticals and Medical Products, Metallurgy, Banks), in “mean, median, 25-th percentile and 75-th percentile” format (Excel file).
Percentile rank for every one of your company’s benchmarks against the whole market and a certain sector. This option also allows you to compare your company benchmarks with those of individual participants1.
Participant’s individual report (example)
If you are interested in participating in the next stage of HR Benchmarking or purchasing the report, please e-mail us at [email protected] or call our consultants:
Alevtina Borisova
Tax and Legal Partner
Tel. (495) 937 4477
Maria Malinina Lyudmila Legkaya
Tax and Legal Tax and Legal
Senior Consultant Senior Consultant
[email protected] [email protected]
Tel. (495) 937 4477 Tel. (495) 937 4477
KPMG in Russia
Head office, Russia and CIS
Naberezhnaya Tower Complex, Block C 10 Presnenskaya Naberezhnaya
Moscow 123317
Number of
replies Minimum 25-th percentile Median 75-th percentile Maximum Your reply Percentile rank
17 66.67% 85.97% 93.26% 96.35% 98.56% 89.00% 35%
Number of
replies Minimum 25-th percentile Median 75-th percentile Maximum Your reply Percentile rank
22 0.68% 7.01% 11.78% 16.98% 45.95% 10.00% 40%
Number of replies
23 65.22% 34.78% Yes
Payroll costs as % of total personnel costs
Employee turnover
Documented HR strategy
