Just recently David (David Youssefnia, Ph.D., is from Critical Metrics, a Seattle-based consulting firm specializing in cutting edge human capital measurement and analytics) and I met with a couple of dozen of my HR Executive Forum (HREF) member executives to discuss Human Capital Analytics. David was there to provide the “consulting professional’s perspective” while Sue McNab, Chief People Officer with PEMCO represented the “practitioner’s perspective.” The HREF has met on this topic repeatedly over the last sixteen years, but this session stood out as the – by far – most interesting and strategic to date.
Gone are the days of discussing transactional data. The dialogue now revolves around how we can turn data into information that gives us knowledge that help us tell a compelling story and ultimately enables us to use big data to increase our capability to make decisions and drive results within our organizations. BIG DATA is here and by going beyond the analytics of the past we can make better predictions and more robust human capital decisions. The challenge HR leaders are facing includes how to put together an effective system of collecting, organizing, summarizing, analyzing, synthesizing, and decision-making. Also, HR practitioners need new skills and competencies that allow them to harness and leverage big date effectively? We need to develop expertise around new tools and resources to tell compelling stories about the analytics. We had an interesting discussion around new technology tools such as word and tag clouds, data visualization and the general use of informational graphics and visual literacy. Bottom-line, we cannot forget that the backdrop question for our big data journey has to be: What needle do we need to move for business success?
For this blog post I decided to interview David Youssefnia by probing some of the issues and questions we surfaced at the HR Executive Forum roundtable a bit deeper.
Q. You mentioned that BIG DATA is allowing us to have a much more robust HR Analytics discussion. How is that? How is BIG DATA applied?D. Organizations are sitting on more and more data about their customers and their employees. There’s a lot HR can learn from what is being done in the consumer research world with BIG DATA. There are larger volumes of data being produced at a faster pace and the data come from a variety of sources. This has also been referred to as volume, velocity and variety. Marketing and consumer research departments are leveraging this data to better understand who their customers are, what they want to buy, and how to best position their brand as well as their products and services. If HR wants to get a seat at the leadership table, then leveraging data from employees to help address business challenges like why top performers are leaving and how employees are impacting customer loyalty and satisfaction should be top priorities for HR leaders.
Q. We talked about tying our employee engagement surveys to customer satisfaction surveys. How is this different from what we have been able to do in the past?D. Being able to tie engagement surveys to customer satisfaction has changed in a couple of ways – we have more data about employees, so it is more than just how engaged they are. Instead, we can look at a larger footprint of what employees do in the organization and how this impacts the customer. Also, we have more data about customers. This provides us with more opportunities to build insights on how employees are driving customer loyalty across the entire spectrum of both the employment and customer life-cycle.
Q. Can you give us an example or two of how HR has stepped into the world of BIG Data?D. There are several examples of how BIG DATA can be applied in the world of HR. Let’s take a critical issue HR typically has to deal with – retaining talent. While we still have a higher than desired unemployment rate, certain segments of the workforce are beginning to experience recruitment and retention challenges, as there are fewer qualified people to fill a growing number of jobs – tech workers are one good example. BIG DATA can help employers better recruit and retain high performers in these roles. Furthermore, there are many of opportunities to look at turnover and what drives it over time. This is not only about conducting exit interviews but also integrating data you may be collecting from exit interviews with employee engagement surveys, performance metrics, and other data you may have about employees. Through the application of predictive analytics, HR can segment out the workforce and statistically determine what kind of employee profile is more or less at risk of leaving. This kind of information can then feed into several areas including hiring, professional development, and succession planning (to name a few).
Q. Are HR leaders approaching the BIG DATA world with the same level of caution as they did social media? And, if so, do you think we will see the same shift over a period of time from resisting and making legalistic arguments towards actually embracing and leveraging BIG DATA?D. It is early in the application of BIG DATA in HR, however, as more companies apply this kind of analytics internally, they are likely to experience some resistance initially. Once results are demonstrated, there will be a shift toward greater acceptance and embracement of HR analytics as a business tool.
Q. While there is huge upside for HR and others in leveraging BIG DATA, isn’t there also a potential downside and opportunities for abuse if clear boundaries aren’t established? Would this be an area where HR could step into a leadership role by setting guidelines and educating around ethics, integrity, transparency and trust?D. It is important that those who sponsor and manage analytics projects be aware of any regulations around privacy, both internal to a company as well as geographically. For example, how employee data is used and transmitted in Europe is subject to many more regulations and limitations than in the US. This can especially cause challenges if you are a US based company with several European locations. Another challenge is how to manage or address the perception of “big brother (or big sister)” watching every move employees make. Using a third party analytics firm may be a consideration to help alleviate the “somebody’s watching me” concern. Individual employee data from surveys, performance management systems and other sources can be combined by a third party and thus help ensure the confidentiality of the results.
Q. What are your suggestions for HR leaders want to step into this brand new world of BIG DATA? How do they get started?D. Start small. Find one or two small projects that can be completed in a short period of time, with a small amount of resources, and with a low risk of failure that will potentially generate 1-2 analytics champions in the organization. After that, focus on areas that are pain points in the organization; analytics that help alleviate pain are ones that generate buy-in and support. The key is not to overpromise what analytics can do. I’d also suggest taking a look at our thought piece on “Getting started with analytics”. This can be found on our website, http://www.critical-metrics.com, click on the research tab to get access to this article as well as some of our other thought pieces.
Also, we’re also offering a complimentary 30 minute consultation on how to get started with analytics to readers of your blog who reach out to us by December 1st. Simply send an email to info@critical-metrics.com or call 206 436 3470.
FAVORITE QUOTES FROM THIS HR EXECUTIVE FORUM• “ Isn’t it sweet, HR now has data!”
• “Just because technology allows you to do it, doesn’t mean you should do it!”
• “If you have not done anything in analytics yet, don’t start big.”
• “Tell a story with your data.”
• “Always be prepared to answer the – so what? – when you look at any data.
• “BIG DATA is here”
• “What needle do we need to move for business success?”
RESOURCES• How to use informational graphics and visual literacy – criticism of PowerPoint : Edward Tufte, Yale University
• Tableau Software – data visualization
• USC – Course on “Data Coaching” – how to tell a story with your data
• Wordle and Tagul– using tag and word clouds
• “Big Data the Management Revolution”, Andrew McAfee, Harvard Business Review October 2012 (http://hbr.org/2012/10/big-data-the-management-revolution/ar/1)