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Using Performance Review KPIs to Develop Frontline Managers

01 Jun

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Your frontline managers are critical to your business, especially when you manage an hourly workforce. Great managers inspire their people to new heights; bad bosses drive them away. That’s why it’s critical that businesses dependent on an hourly workforce actively develop their managers’ skills. One of the best ways to do this is by implementing KPI-centered managerial performance reviews.

In an hourly-paid work environment, managers often come up through the ranks. Training is frequently off-the-cuff and on-the-job. As a result, new managers may not know everything that’s expected of them or how to best allocate their time. Thorough performance reviews can fill in some of those blanks by formally defining managers’ roles, goals, and key tasks.

But what key performance indicators should you incorporate into your managerial performance reviews? And how do you collect the relevant data? Soft skills can be effectively evaluated through 360-degree surveys. Other, more measurable KPIs can be collected through your HR and payroll software, assuming your software offers you access to such analytics. The more KPIs you can measure analytically, the more effective your evaluations may be.  

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Let’s take a look at some of these KPIs, shall we? 

KPI #1: Turnover Rates

In light of the current labor shortage, turnover has become an increasing concern. One undisputed factor driving turnover: bad bosses.

According to Gallup research, a staggering 75% of voluntary turnover can be attributed to employee dissatisfaction with their immediate managers. In addition, Gallup found this dissatisfaction was rooted in the perception that their managers’ expectations were unclear, or because they failed to provide the equipment and resources workers needed to succeed at their job.

If your company is utilizing HR analytics, you should be able to track turnover rates by manager. Furthermore, you should be able to compare your managers’ numbers, allowing you to set a baseline for the company and measure how each manager’s performance compares.

KPI #2: Communication Skills

As the Gallup research indicated, workers crave their managers’ attention and guidance. Only about one-third of America’s workforce is engaged at any time—and for the hourly workforce, frontline managers hold the key. 

360-Degree reviews can be highly effective at measuring and encouraging open, continuous communication with direct reports. A 360-degree managerial review might include questions like:

  • How often do you have conversations with your manager?
  • Does your manager coach you on how to do your job more effectively?
  • How often does your manager ask your opinion?
  • Does your manager keep you abreast of company news?
  • Do you feel that your manager listens to you?

KPI #3: Overtime Costs

If you operate on thin margins, unplanned overtime can wreak havoc on your ROI. If you don’t track managers’ overtime costs, you’re missing out. Who’s incurring excessive overtime—and why? Does the manager need to work on his/her scheduling skills? Is the unit understaffed? Or is something else going on?

By setting overtime standards and assessing how individual managers measure up, you not only help managers operate more efficiently, but enlist their aid in controlling your labor costs. 

KPI #4: Time and Attendance System Management

Accurate, compliant time tracking is hugely important to employers managing an hourly workforce. Sloppy time tracking can drive up labor expenses, create wage and hour compliance violations, and delay payroll processing.

Most employers monitor how workers interact with their time and attendance system—primarily through their managers supervision. However, it’s equally important to look at the managers’ activity, too. Consider this subset of KPIs:      

  • How many open punches are occurring? – If a high-volume of workers are failing to punch in or out under the manager’s watch, intervention is needed. 
  • How long does it take the manager to close open time-clock punches? – Long time lags can result in incorrect paychecks and delay payroll processing.
  • Is the manager changing worker punch times? – Changing punch times is a potential compliance violation and may also indicate complicit time theft. It happens. 
  • Is the manager changing pay rates? – Also, a potential compliance violation and potential indication of time theft.

Unfortunately, most time and labor software doesn’t have the capabilities to track these KPIs—but most time and labor software isn’t designed for an hourly workforce. So, what are your options?

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Improving Performance Reviews for Frontline Managers

At Vensure, we understand how important your frontline managers are.  Our innovative analytics allow you to track—and compare—KPIs including turnover, overtime, and time and labor metrics by manager, shift, and/or worksite.

In addition, our seamless performance management software allows you to create custom managerial performance reviews. In short, we can help you realize a better return on your hourly workforce—starting with your all-important frontline managers. Contact us today and let us show you more. 

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