Do People Really Understand Your Metrics? Why Definitions Matter

We talk a lot about KPIs in HR—headcount, attrition, span of control, engagement scores. But here's the problem: we’re not always talking about the same thing.

It’s easy to assume everyone understands what a metric means. But in practice, even basic terms like “headcount” or “turnover” can mean wildly different things to different teams. One person counts interns. Another doesn’t. One includes approved reqs in the open headcount number. Another doesn’t. And suddenly, your People Dashboard becomes a source of confusion instead of clarity.

The issue isn’t the math. It’s the meaning.

1. The Illusion of Alignment

I once worked with a senior leader who insisted our attrition rate was wrong. He had built his own version using Excel and pulled numbers from a different source. Technically, he wasn’t wrong—we were just working from different definitions.

His version excluded early attrition. Ours didn’t. That one discrepancy led to weeks of distrust and delays.

The insight?
Without a shared language, metrics lose their power.

2. What “Headcount” Are You Referring To?

You’d be surprised how many different “headcount” numbers can exist inside a company.

• Active headcount (people currently employed)
• Total headcount (including those on leave)
• FTE headcount (based on % of working hours)
• Budgeted headcount (approved positions, not all filled)

Each version is valid. But without a consistent label—and explanation—people start comparing numbers that aren’t meant to be compared.

I now label every headcount number with a footnote. Not because it’s “nice to have,” but because someone will challenge it if I don’t.

3. “Attrition” Is Not a Universal Metric

Voluntary or involuntary? Internal transfers included or excluded? 90-day exits counted or not?

A client once told me their attrition was under 10%. But after digging in, I realized they excluded all internal transfers, promotions, and even contractors who rolled off. Their “low attrition” story made sense only in their version of reality.

That’s not necessarily wrong—but if Finance, HR, and Talent all report different attrition rates, it kills the conversation.

“If we don’t define the same reality, we can’t plan the same future.” — I’ve used that phrase more times than I can count.

4. Create a Simple, Visible Metrics Dictionary

When we launched our People Dashboard, we added a second tab: Metrics Glossary.

Every term we used—headcount, span, turnover, promotion rate—had a plain-language definition. It included:

• What’s counted
• What’s excluded
• Time period logic
• Data source

It took one day to build and reduced misalignment overnight. People started checking the glossary before challenging the numbers.

And when they didn’t? I could point them straight to it.

5. Involve Stakeholders Early

Metrics should never be defined in isolation. Bring in Finance, Talent Acquisition, and even business partners when finalizing key terms. Ask: What do you think this means? What do you usually report?

You’ll catch discrepancies early—and build ownership at the same time.

When we updated our “internal mobility” metric, it sparked a huge conversation. Should it include cross-team lateral moves? Only promotions? Intern to full-time? That conversation took two weeks—but it aligned three teams for the first time.

6. Keep Definitions Front and Center

The more visible your definitions are, the more useful your metrics become. I always:

• Add hover notes to dashboards
• Include a short definitions box on slides
• Use consistent labels across systems
• Avoid terms like “Total” or “All” unless they’re fully explained

Clarity beats complexity.

Conclusion

Metrics only drive value when they’re understood the same way by everyone looking at them. Ambiguity doesn’t just confuse people—it slows decisions, breaks trust, and undermines the role of People Analytics.

Your job isn’t just to count things. It’s to create a shared language around what the numbers mean.

Because when everyone speaks the same data language, the conversation shifts—from challenging the numbers to acting on them.