In a world where businesses are having to constantly seek legal unfair competitive advantages (LUCA), human resources has long since shaken its back-office label to evolve into a critical strategic driver of organisational success. However, modern people management comes with significant metrics, which often weigh in heavily on multitasking HR leaders' plates. HR Magazine speaks with David Simmonds, a pioneering expert in HR metrics, to find out more about his lead in a revolutionary approach to help better demonstrate HR's true value. Challenging traditional perceptions of HR as merely an administrative cost centre, Simmonds asserted, “Today HR is about transforming the organisation strategically to enable the organisation to hit the bottom line.” We examine how and why ISO 30414 looks set to transform HR metrics from cost centres into strategic organisational powerhouses.
Today, HR is about transforming the organisation strategically to enable the organisation to hit the bottom line.
David Simmonds, Chairman-HCM Metrics, Founding Member of the Society for People Analytics (SPA)
The traditional view of HR as a cost centre is rapidly becoming obsolete. Modern organisations are demanding more from HR—more transparency, more measurable impact, and more strategic insights into their most valuable asset: their people. This shift is being driven not just by internal leadership, but by external stakeholders, including investors who want unambiguous evidence of how human capital contributes to the organisational performance.
Highlighting this growing pressure for comprehensive human capital reporting, Simmonds explained, "If I'm going to invest in your company, I want to know where my money's going in terms of talent expense categories and what each is worth."
The key to this transformation lies in sophisticated metrics and data-driven decision-making. According to Simmonds, currently, only 20 companies worldwide have fully adopted the advanced ISO 30414 HR reporting standards—with most of them concentrated in Japan. This ‘HR metrics gap’ presents a massive opportunity for forward-thinking organisations to gain a competitive edge.
The emerging ISO standards, which are soon set to come into effect in the EU, go far beyond traditional HR measurements. They encompass 60 basic metrics and 200 data points that provide a holistic view of an organisation's human capital. These metrics cover qualitative and quantitative aspects of employee performance, investment and potential—offering unprecedented insights into organisational health.
The approach is particularly crucial during challenging economic periods. Simmonds noted, “When businesses face contraction and are cautious about talent investment, robust HR metrics can provide the evidence needed to make strategic decisions. Instead of relying on opinion or historical practices, HR professionals can now use concrete data to justify investments in training, development and talent retention.”
Technological innovation is making such advanced metrics even more accessible. Simmonds and his team are developing an App that can integrate with existing HR information systems such as SAP, Oracle and Workday, allowing HR managers to generate comprehensive reports with the push of a button.
The potential impact extends beyond individual organisations. These metrics enable benchmarking across companies, industries and even nations, creating a cycle of continuous improvement in human capital management.
Interestingly, the drive for such comprehensive reporting is being fuelled by external pressures. Shareholders, investors and regulatory bodies are demanding greater transparency around human capital investments. The European Union's ESRS S1 and S2 reporting standards will require organisations to be much more transparent about their own workforce as well as workers in the value chain, respectively. Such regulations are a clear indicator of the growing trend towards more transparent, holistic reporting and that comprehensive HR reporting might soon become mandatory rather than optional.
Those who can master data-driven approaches will become strategic partners in organisational success, moving far beyond traditional administrative roles.
Simmonds noted this is a pivotal time for HR, “For HR professionals, this represents both a challenge and an opportunity. Those who can master data-driven approaches will become strategic partners in organisational success, moving far beyond traditional administrative roles.” He added, “The parallels with quality management standards are striking. Just as ISO 9000 series standards transformed quality control, these HR metrics have the potential to revolutionise how organisations understand and leverage their human capital.”
Simmons concluded, “The future of HR is not about managing personnel, but about strategic human capital investment.” As businesses navigate increasingly complex global landscapes, the HR professionals who embrace data, metrics and strategic thinking will be the ones who drive organisational success. The era of HR as a passive administrative function is ending. The future belongs to those who can translate human potential into measurable, strategic value.
The journey has begun, get ready to transform your approach to HR…
Paul Arkwright
Publisher
