KPIs, SLAs and Practical Application

Covering Assessment Criterion 3.1 from 5CO02 Evidence-based Practice, this video examines Key Performance Indicators and Service Level Agreements as practical measurement tools within people practice. The SMART framework — Specific, Measurable, Achievable, Relevant and Time-bound — features as the basis for constructing effective KPIs, alongside a range of HR-specific examples including time-to-hire, voluntary turnover rates, employee engagement scores, training completion rates and absence levels. The video addresses how the selection of people-related KPIs should reflect broader organisational strategy, illustrating the point with reference to customer-facing team engagement where customer service excellence is a stated priority.

The risks of over-reliance on a narrow KPI set receive focused attention, with the video examining how intensive measurement of a single indicator — such as time-to-hire — can produce unintended behavioural consequences that undermine other performance dimensions. This tension between hitting numerical targets and achieving substantive outcomes is explored through the lens of what a balanced KPI framework looks like in practice. SLAs are then examined as formal service commitments, covering their typical components — quality standards, response timeframes, resolution windows and consequences for missed targets — with concrete HR examples including payroll query resolution and recruitment request acknowledgement drawn from shared services and HR service centre contexts.

The final part of the video turns to integration, considering the cause-and-effect relationships between leading and lagging indicators and how financial and non-financial measures interact across the performance spectrum. The connection between non-financial leading indicators such as training completion and downstream outcomes such as productivity and customer satisfaction is explored as the basis for constructing a business case for people investment. Stakeholder communication, strategic benchmarking and the role of measurement in enabling timely intervention are all brought within scope of the discussion.