Saturday, May 2, 2015

Three Missing Elements to Fail Talent Analytics

If people are the most valuable asset in business, companies cannot afford to ignore the analytics of their current or future workforce.
People are always the most invaluable asset in businesses, but most of HR organizations only play the supporting role as an administrative function; talent analytics becomes the very tool to help HR in their digital transformation journey. However, some pivotal organizations who adopt talent analytics earlier than others do not achieve the expected result, what’re the missing elements, or the pitfalls in doing talent analytics, and how to learn from others’ failures?


The missing element #1 in talent analytics -Objective: The business goals and objectives are more critical rather than observational data about the individual which has explanatory power over performance, retention etc; If strategy is planning and organizing to "get somewhere," how can you know where you are relative to your goal without objective landmarks. So, the question to be asked before starting to move in analytics is "What objective evidence will show us that we are accomplishing our goals?" And if you can't come up with metrics, then, what are you doing? As leaders begin to understand that data supplements but do not replace "gut" feelings,  more companies are embracing the idea that measuring the alignment of performance to strategic goals really does guide decision-makers to make the right choices. Statistically, "the total cost of a workforce represents nearly 70 percent of operating expenses for Fortune 500 companies." The real value in HR is revealed when the HR professional is able to highlight a decrease in total human expenses next to an increase in performance and revenue.


The missing element #2 in talent analytics - Long term planning: The company needs to make strategic long term plan with multiple phases before they can have meaningful analytics. Expectations of a faster turnaround in most cases don't yield great outcomes. Most companies start getting significant payback after years effort put on improved and data-based decision making, higher visibility and greater transparency and all levels.
(1) Implementation phase: Define the requirements and identify the right software. Implement it and communicate aggressively such that it is used by all employees and managers.
(2) Data integration phase: Refine the data metrics being collected and integrate external data (such as financial, production data).
(3) Communication phase: Coach managers how they can use the different dashboards and reports and help them inculcate these in their daily decision making and planning.

The missing element #3 in talent analytics: Data Management: Established workforce analytics takes time and patience while getting the collection correct, cleaning the data, and setting up automated feeds from the data source systems. This being said the time and energy are worth the effort. Workforce information can be used to determine talent movements, benefits preferences, reward program acceptance, and cost - just to name a few of the benefits. With workforce planning and analytics, organizations can successfully move hundreds of staff across the group's projects on timely schedule. Being able to find the gap in the supplies (internal/ external) and the forecasted demands, save a huge amount of time efforts and money for all stakeholders. It served as a vital tool in recruitment, compensation and benefits, performance appraisal and led to wise investment in training.


The success stories of talent analytics have revealed the linkage between Finance and HR as one of the most critical factors in transforming how the business views the contribution of their people function. If people are the most valuable asset in business, companies cannot afford to ignore the analytics of their current or future workforce. HR analytics are finally starting to get some attention and should be a huge growth field in the coming years. Any company that ignores their HR analytics will be the digital laggard which would lose the talent game in digital transformation.


1 comments:

Well said, Pearl! Lots of great points. The benefits are even more pronounced when predictive or prescriptive analytics are used to solve business challenges pre-hire.

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