Theory of HR Quantification

Theory of HR Quantification is an advanced theory in Human Resource Management. It states that Human Resource Management can be given quantitative aspect just like other forms of managerial science. The said theory has been seen as revolutionary since it transforms the nature of Human Resource Management from being an independent managerial department to a strategically linked growth advancing department. Further while it was used to be believed that Human Resource Management cannot be assigned numerical values., the Theory of HR Quantification has disproved this notion. This theory has been developed by Indian inventors Pooja Jain and Pranjal Jain . The Theory of HR Quantification introduces certain concepts which deal with Human Resource Management principles in numerical terms. These concepts include Feedback Index, Organizational Feedback Index, Employee Feedback Index, HR Analytics, Employer-Employee Productivity Model etc.
Feedback Index
Feedback Index is a mathematical tool which evaluates the amount of employee empowerment present in an organization. It utilizes the concept of Feedback as a core driver for evaluating the level of employee engagement. It estimates the level of employee engagement from two sources. Firstly the organization as a whole is tested and secondly the perception of the employees is recorded. These two sources are accordingly termed as Organizational Feedback Index (OFI) and Employee Feedback Index (EFI).One of the important implications of Feedback Index is that it derives the opinion of the Organization without resorting to the method of survey or questionnaire.
Employee Feedback Index
Employee Feedback Index (EFI) is the tool which evaluates the perception of the employees towards the amount of employee empowerment level present in the organization. EFI serves twin purposes. Firstly, it provides the direct views of the employees and secondly it corroborates the results obtained from the OFI.
EFI computation methodology constitute segmenting the workforce into top management level, middle management level and lower management level. Different sets of detailed questionnaires are prepared for each management level. Their individual responses are scaled on the basis of a mathematically derived algorithm. This algorithm states that the scaled value shall be the (alloted value - minimum value) with respect to the (maximum value - minimum value). Thereafter an average score is taken for all the questions. Thereafter the geometric mean of top management score, middle management score and lower management score is taken to derive the EFI value. The value is then corresponded to a Score Class Interval.. Such techniques constitute Human Resources (HR) as a measurable subject and establishes correlation-regression analysis between HR and other variable elements such as sales, production, marketing, strategy etc.. The fundamental principles of statistics dealing with mean, median and mode can be applied in Human Resource Management for measuring the employee productivity. These three interlinked metrics may be applied in diverse domains. Firstly, mean employee working hours may be computed to evaluate Average Productive Working Hours. Such computation may be made for per year basis or for per month basis or even for per day basis. The Average Productive Working Hours provide a solution to the queries such as how much time does an employee spends on commutation, how much time does an employee spends in break period and how much time does an employee actually devote towards the organization. improved. Application of mean in employee working hours assists in computing Full Time Equivalent (FTE) of the employee working hours in achieving the objectives of the organisation. This FTE is used to compute the amount of Revenue earned per one employee working hour. This is called as Revenue per FTE hour. The level of Revenue per FTE hour signifies that whether the activities of employees are leading to revenue maximisation or not. Thereafter another ratio can be computed which is termed as Expenditure per FTE hour. This denotes the amount of employee benefit expenses that are being incurred per each employee working hour. By knowing all these factors adequate action can be taken and overall organizational growth can be improved. Secondly, the concept of Median, Percentile and Quartile is used to evaluate demographic characteristics of the workforce. It provides hands on information with respect to organizational demography, such as what is the median age of the employees, what quartile of workforce is engaged in manufacturing sector, what quartile of organization is engaged in sales support sector etc.. Thirdly, mode is used to identify which factors replicate the highest productivity levels of the employees.
The Theory is unique in its nature since it utilises the conventionally deployed quantitative techniques to assist the strategic growth objectives of an enterprise. By applying such kind of techniques it converts the soft knowledge into hard knowledge, i.e. it codifies the qualitative human knowledge into a citation based neural network.
HR Analytics
HR Analytics also termed as People Analytics is the application of modern technology in the field of Human Resource Management. It is the technological tool to analyze the past transactions, interpret the current trends and project the future happenings.
HR Analytics have a key role to play in the modern business environment. It has the capability to provide sustained competitive advantage to the organization by not only analyzing the past shortcomings but also by predicting the expected reaction of the employee based upon the change in the organizational policies.
HR Analytics acts as an advanced decision support system which aligns HR department with the strategic department. It allows the top management to frame overall organizational policies on the basis of robust algorithms.

How this Theory links HRM with Strategic Management
By adding quantitative element to Human Resource Management, strategic analysis can be made with respect to the most important resources of an organziation, its Human Resource. When organizations are equipped with the ability to predict the future happenings they are able to take strategic decisions. Hence Theory of HR Quantification transmutes HRM to Strategic HRM.

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