“He picks up scraps of information
He’s adept at adaptation
Because for strangers and arrangers
Constant change is here to stay…”
—Neil Peart (musician and writer), “Digital Man”
So I’m standing there and this HR VP walks up and asks:
“What does the ‘predict’ mean?”
At first I don’t get it and am not sure what to say; repetitive tech talking with waves of people stretched over time can dull one’s focal strength, like trying to blow bubbles with stiff old gum that lost its flavor hours earlier.
Then he points to the one of the panels in our PeopleFluent booth with the word “predict” on it.
“Ah, good question,” I say, perking up. “That’s probably something you’re hearing a lot more from your management team. How do we predict? Am I right?”
He nods and adds, “Analytics, analytics, analytics! Seriously. We need predictive analytics that can help us understand who is engaged, who is performing, and why, but we’re not sure exactly how to get there.”
Certainly one of the major themes at this year’s 2014 HR Technology Conference & Exposition, thousands of HR technology buyers and influencers hiked for miles and miles through a $15 billion landscape according to Bersin by Deloitte’s HR Technology for 2015: Ten Big Disruptions Ahead.
Bersin’s latest report states that finance, marketing, and supply-chain organizations have implemented analytics solutions for decades, but only now is HR starting to see the benefits with only 4% of large organizations able to “predict” or “model” their workforce. However, more than 90% can model and predict budgets, financial results, and expenses.
Talent analytics, analytics, analytics!
That’s why business leaders continue to shout more frequently from their rooftops about getting the right talent analytics from HR today that inform their near- and long-term recruiting, performance, compensation, succession and learning strategies — all to support their corporate financial goals and ultimate results.
Wait, what’s that you ask? It makes common business sense, but just isn’t the reality HR executives are living in today. The majority of business leaders agree that the most vital investments for long-term growth are the people they attract, hire and employ, but too many are still focused primarily on basic (reactive) reporting.
This week in fabulous Las Vegas, we echoed TalentCulture #TChat Show guest Jessica Miller-Merrell that we just can’t get to the truth from reactive reporting and gut checks, so where do we start?
Data management is where it all starts, although aggregating and maintaining the sheer volume of talent data available today can be daunting to even the most progressive CHROs. Large organizations have multiple systems managing HR and financial data, and to get to a single source of business truth, you must maintain and leverage both micro (such as individual performance data) and macro (such as organizational trends) data together, unifying it from any and all systems so that it is transformed, standardized and reportable.
Only then you’ll be able to plot past trajectories, analyze the present, and predict the future needs of your talent supply chain management, which can in turn lead to measurable improvement in your financial performance.
Mature talent analytics and positive business outcomes come to those who master their data, and, again according to Bersin, the 14% of companies that have invested in data-focused HR far outperform those that haven’t. Recruitment efforts are two times more effective and stock returns outperformed their peers by 30% over the last three years. But of course, these results don’t come without a serious investment of energy, resources and time.
The benefits of creating a single source of business truth are huge. Companies outperforming all others today focus on delivering:
- Recruiting Analytics – Help you understand your current talent supply, both internally and externally, and the skills needed today versus those that will be needed tomorrow. Plus, leveraging the diversity strengths of organizations beyond gender, race and geography to include the skills and expertise that lead to business growth are important predictive elements in planning for the right skills and productivity tomorrow. For example, Center for Talent Innovation research showed that diversity “unlocks innovation and drives market growth” and companies that embrace diversity “are 45% likelier to report that their firm’s market share grew over the previous year and 70% likelier to report that the firm captured a new market.”
- Compensation and Performance Analytics – Give you the ability to define your investment strategy in people because it’s less about budget management and mediocre (or worse) pay practices, and more about driving business growth relative to individual and organizational performance. This is critical to preventing future compensation increases for poor performers by using predictive analytics to highlight where these have happened historically and why. For example, according to a 2014 compensation and benefits survey by Human Capital Media Advisory Group, the research arm of Talent Management magazine, only 40% of companies say their organization’s compensation program is fully aligned with the business strategy.
- Learning & Development Analytics – Provide you a clearer view into strategizing continuous development and improving retention. Predictive analytics allow you to look at current sales relative to high-performer output and retention, and see how they impact long-term sales and development. Firms require an engaged and developed workforce so they can promote from within, saving on external recruiting costs that don’t ensure even short-term retention in today’s competitive talent market. In fact, according to Wharton management professor Matthew Bidwell, “external hires” get significantly lower performance evaluations for their first two years on the job than do internal workers who are promoted into similar jobs.
It’s time to answer the talent analytics call!
HR can and should drive their organization’s workforce strategy from a unified platform of meaningful data and analytics. But first, a single source of business truth is critical to providing guidance for all your talent management decisions, reinforcing the relationships among finance, operations and all business units in your organization, and delivers the ultimately desired business performance and results.
Constant change is here to stay, so you may as well get comfortable with picking up the scraps of perpetual information that ultimately create the right talent analytics collective.
Anybody got any gum?