HR controlling – Methods, KPIs & reporting tools

HR controlling, as a human resource management approach focused on optimizing workforce performance, links data with decision-making, providing the structure to evaluate costs, outcomes, and efficiency. By using the right KPIs, methods, and reporting tools, HR teams can demonstrate measurable business results, transforming human resource management from a support function into a strategic driver of organisational performance. Effective HR controlling also involves close collaboration with finance professionals, such as an accountant, to manage budgets and financial planning.

What is HR controlling?

HR controlling refers to the systematic collection, analysis, and reporting of data related to human resources. It provides control over HR processes and costs, ensuring that organisations can effectively manage and optimise their workforce. It provides transparency into workforce costs, performance, and value creation. By adopting HR controlling practices, HR departments can make evidence-based decisions that align people strategies with corporate objectives. In this context, accounting—specifically management accounting—provides analytical tools and measurable indicators that support HR controlling by enabling data-driven analysis and informed decision-making.

The strategic role of HR controlling is to demonstrate how HR activities affect business results. From workforce productivity to employee retention, HR controlling establishes a clear link between people and profit. Understanding the total cost of personnel—including recruitment, employee turnover, and workforce optimisation—is essential for strategic decision-making and improving organisational efficiency. This enables leadership to view HR not as an administrative cost centre, but as a strategic partner driving organisational success. 

When embedded into business planning, HR controlling also strengthens risk management and supports human resource management by enhancing organisational efficiency. Accurate forecasts for labour costs, turnover, and skills shortages allow organisations to anticipate challenges before they arise. This forward-looking approach ensures that HR policies and investments actively support long-term growth.

The role of the HR controller

The HR controller ensures that HR decisions are evidence-based and aligned with business strategy, with clear responsibilities that often include the division of tasks within HR teams. While workforce planners focus on staffing and HR business partners focus on people initiatives, the HR controller provides the analytical framework to measure impact and guide strategic decisions.

• Designing and maintaining HR reporting systems: Creating dashboards and reports that track costs, headcount, performance, and engagement. 
• Monitoring HR KPIs: Analysing metrics to identify trends, inefficiencies, and potential risks.
• Advising leadership on workforce planning and efficiency: Translating data into practical recommendations for staffing, retention, and resource allocation.
• Collaborating with HR business partners: Turning people initiatives into measurable outcomes that support business objectives.
• Conducting job evaluation and defining roles: Supporting transparent compensation policies, employee appraisal systems, and overall employee development by ensuring clear job definitions and evaluations.

In different organisations, the HR controller's responsibility may fall under other roles such as FP&A or corporate controllers, and the specific tasks and skill sets required can vary depending on organisational structure. These responsibilities and required skills can differ significantly in different companies, reflecting the unique practices and needs of each organisation.

By structuring HR data and turning it into decision-ready insights, the HR controller makes HR measurable, accountable, and strategically influential, bridging the gap between HR operations and business performance, allowing leadership to act confidently.

Key methods in HR controlling

Several methodologies are central to HR controlling, each providing different perspectives on HR performance. Key performance indicators (KPIs) are central to evaluating HR effectiveness and identifying areas for improvement: 

• Cost analysis: Examines personnel costs, training expenses, and recruitment budgets, and compares them with outputs to assess efficiency. For example, an HR controller might analyse the cost per hire for a specific department to identify savings opportunities. 
• Benchmarking: Compares HR performance against industry standards or peer organisations to identify areas for improvement. An instance of this could be comparing employee turnover rates with those of similar companies to highlight retention challenges. 
• Balanced scorecards: Integrates HR metrics into a broader strategic framework, ensuring that people-related objectives are tied directly to corporate goals. For example, HR might track training completion rates as part of the scorecard to align with organisational learning objectives.
• Predictive analytics: Uses data modelling to anticipate turnover, skills gaps, and workforce demands, allowing HR to act proactively. In this method, assumptions about future hiring needs or market changes are inputted into HR systems to create different scenarios and compare varied budget plans. For instance, predictive analytics can model the impact of a 10% increase in attrition on staffing costs. 

Return of Investment (ROI) measurement: Evaluates the return on investment from HR initiatives, such as leadership programmes or employee engagement activities. As an example, ROI measurement might be used to assess the financial impact of a new onboarding process. HR controlling tools also help develop employee skills and support ongoing employee development, ensuring that investments in training and growth contribute to organisational success.

Each method contributes to a more accurate, data-driven picture of workforce effectiveness and organisational health.

HR KPIs every HR department should track

Tracking the right HR KPIs is at the core of HR controlling. Essential metrics include:

These KPIs demonstrate the tangible impact of HR on revenue, innovation, and competitive advantage. According to Gallup, disengaged employees cost the global economy $9.6 trillion, highlighting the urgent financial implications of poor engagement.

Key tools and capabilities in HR controlling

The effectiveness of HR controlling depends heavily on robust reporting systems. Modern HR and workforce management systems combine automation, visualisation, and predictive analytics to deliver insights in real time. Well-structured processes are essential for streamlining operations, automating calculations, ensuring security, and improving decision-making within HR and workforce management systems. To make HR controlling actionable, reporting stacks typically include the following components:

Integrated data foundations

HRIS, payroll, time, and talent data consolidated with consistent KPI definitions, ensuring all reports draw from the same reliable source.

Self-service dashboards and scheduled packs

Role-based dashboards allow HR and finance teams to drill down into data. Automated monthly “controlling packs” keep leadership informed without manual reporting effort.

Advanced analytics

Advanced analytics tools provide trend and cohort views, perform variance analysis against budgets or forecasts, and use predictive models to anticipate workforce needs. Analytics can also track employee involvement in different projects and allocate costs and time, accordingly, supporting project-specific cost analysis and scenario planning.

A key part of this is people analytics, which focuses specifically on workforce data to improve recruiting, retention, and productivity. 

The impact can be substantial: McKinsey reports that organisations with strong people analytics see an 80% increase in recruiting efficiency, a 25% rise in business productivity, and a 50% reduction in attrition.

Governance and auditability

Data lineage, versioning, and report approvals ensure compliance with statutory and internal controls. HR activities are often organised or reported along specific lines of authority or responsibility, supporting effective governance and alignment with corporate objectives.

Strategic workforce forecasting

Aligns headcount and labour-cost planning with actual financial results, ensuring workforce scenarios are reconciled with budgets and forecasts. This capability connects operational HR decisions directly to business planning.

Implementation of HR controlling in human resources management

Implementing HR controlling within human resources management is a strategic move that empowers organisations to achieve their business objectives and enhance employee productivity. By leveraging HR controlling, HR professionals gain access to valuable insights and tools that help them manage HR processes more effectively, making the HR department a true business partner rather than just a support function.

The process of implementing HR controlling can look different across companies, depending on company size, organisational structure, and the unique challenges each business faces. Regardless of these differences, the primary goal remains the same: to align human resources management with overall business objectives and ensure that HR processes are both efficient and effective. HR controllers play a pivotal role in this, taking responsibility for managing costs, payroll, and employee benefits, while also providing actionable data and analysis to support strategic decision-making.

A key advantage of HR controlling is its ability to offer a comprehensive overview of all HR processes. By systematically analyzing data related to employee turnover, recruitment, and training, HR controllers can pinpoint inefficiencies and areas for improvement. For example, automating payroll and benefits administration can significantly reduce manual workload, freeing up HR professionals to focus on higher-value activities such as talent development and workforce planning.

Workforce planning is another critical component of HR controlling. By examining market trends and internal company data, HR controllers can identify current and future skills gaps, enabling the organisation to proactively address talent shortages. This might involve recruiting new employees, investing in targeted training programs, or developing retention strategies to minimise employee turnover and maintain a stable, skilled workforce.

The benefits of HR controlling extend beyond the HR department. Managers gain valuable insights into staffing needs, training effectiveness, and employee performance, allowing them to make informed decisions that support business growth. Accountants and finance teams also benefit from HR controlling data, as it provides a clearer picture of total personnel costs, supports more accurate budgeting, and highlights opportunities to optimise spending—such as streamlining recruitment processes or implementing more efficient payroll systems.

Successful implementation of HR controlling requires a blend of skills, including data analysis, financial acumen, and deep HR expertise. HR controllers must be adept at collecting and interpreting data, recognizing trends, and developing strategies that address both challenges and opportunities. Strong communication skills are also essential, as HR controllers need to collaborate with managers, accountants, and other stakeholders to ensure that HR controlling delivers maximum value.

To get the most out of HR controlling, organisations should tailor their approach to fit their specific needs and objectives. This may involve developing a robust HR controlling system, investing in training for HR controllers, and setting clear goals for what HR controlling should achieve. By doing so, companies can ensure that their HR controlling practices are not only aligned with business objectives but also provide the valuable insights needed to drive continuous improvement and maximise employee productivity.

By embedding HR controlling into the fabric of human resources management, organisations can transform HR into a valuable asset that supports strategic decision-making, optimises costs, and drives business success.

Enabling HR controlling in practice

Putting HR controlling into practice goes beyond collecting data. Organisations need integrated tools, reliable processes, and actionable insights that work across regions and business units, making HR controlling valuable for businesses of all types and sizes. Effective HR controlling also supports managing people by combining data-driven insights with practical people management strategies. The effectiveness of HR controlling and payroll automation systems can also depend on company size, as manual processes become impractical beyond a certain number of employees and tailored IT solutions are essential for larger companies. Explore how HR controlling is applied and the key approaches that make it effective.

A real-world approach to HR controlling

While many tools can capture and present HR data, the real challenge lies in creating a single, reliable base for analysis that scales across regions and business units. The identification of key HR metrics or data points is a crucial step in effective HR controlling across business units.

Foundation: Data integration & standardisation

Zalaris PeopleHub provides the foundation for effective HR controlling. Built on SAP SuccessFactors, PeopleHub combines enterprise-grade HR technology with Zalaris’ own analytics solutions. This creates a single, scalable environment that unifies payroll, HR data, time, expenses, and analytics into one consistent framework.

A core element of this platform is centralised multi-country data integration. By consolidating people and payroll data across regions, organisations gain a true single source of truth. This enables consistent HR KPIs and statutory reporting across more than 150 jurisdictions, ensuring reliability and comparability in global HR controlling.

Analytics & reporting capabilities

Connected insights

Combining technology with specialist advisory support helps organisations turn HR data into actionable insights. Zalaris consultants work alongside the platform to align HR data models and KPIs with strategic objectives, design standardised controlling packs, and establish governance structures that ensure reports are compliant and decision-ready.

With this support, organisations can monitor and manage key HR metrics, including:

• Headcount, labour cost, and vacancy cost-of-delay through monthly HR controlling packs
• Workforce stability, tracking attrition, internal mobility, and absence with predictive alerts
• Recruitment efficiency, analysing time-to-hire and pipeline velocity against lost productivity
• Learning investment, linking training spend to performance outcomes

This approach ensures HR controlling is comprehensive, accurate, and actionable, combining real-time analytics with expert guidance.

Best practices for effective HR controlling

To unlock the full value of HR controlling, several practices are recommended:

1. Align KPIs with business goals: Ensure that metrics align with strategic priorities rather than focusing on isolated HR functions.
2. Automate reporting: Reduce manual effort and improve accuracy with integrated software solutions.
3. Focus on quality, not just quantity: Tracking too many metrics dilutes focus; concentrate on those that have a real business impact.
4. Enable real-time insights: Provide leadership with timely information for fast, informed decisions.
5. Integrate HR controlling into planning cycles: Make HR analytics a regular part of financial and operational forecasting.

These practices allow HR to not only monitor performance but also influence the organisation’s future direction.

HR controlling as a strategic asset

HR controlling turns workforce data into business intelligence. By applying the right methods, tracking relevant HR KPIs, and using advanced reporting tools, HR transforms into a strategic partner that actively drives organisational success.

Zalaris enables HR departments to achieve this transformation through its HR analytics and reporting solutions, integrated seamlessly with SAP SuccessFactors. We can help ensure that HR measures performance by demonstrating its impact on profitability and growth. 

Our HR analytics services deliver the insights required to optimise workforce decisions and secure a competitive advantage. Speak with our team today to discover how HR controlling can unlock measurable value without delay.