Monday, September 28, 2015

Are HR Professionals Fearful of Analytics?

Great analytics is not just numbers or statistics, they are the story behind the data. 

Analytics in business is a way of measuring results and outcomes and, if you don't measure, how can you go about making and measuring improvements? Analytics typically are performed by IT, finance, and other technical players in a company. For HR to branch out into the analytical realm, it might be intimidating - depending on the company culture. HR needs to look after the Human Capital side of things, but you also need to manage and measure just like every other functional area of a business. You really need to be good business stewards first and HR SMEs secondly--run HR like a business and align your strategies to those of the business.


Those who are very much aware that analytics is simply a game changer – it can bare truth.  There are two reasons in doing analytics: 1). they can provide amazing clarity into what drives business performance. 2). that often comes with aha moments and transparency that make people squirm. Contrary to popular perception or understanding, the HR professionals with game-changing mindset are, truly, not fearful of analytics. Rather, they are appreciative of analytics and are much inclined to use it but in absolute privacy. It's really important to think about not just the analytics, but what the analytics mean and how you will talk about that with your various constituencies from employees to mid-level management to executives. Often the fear lies in the probability that use of analytics may reveal such truth that can cause the embarrassment, or put them in low professional esteem if the results are made public. The further development of analytics is crucial to enable HR to provide fact-based evidence of the function's quantifiable impact on the business objectives. It will help gain credibility, engagement, and align HR reporting with that of the rest of the business. Some reluctance may be due to the fact that so much of the value that can be added by the HR team is difficult to quantify, and too heavy a focus on statistics could further detract from the recognized value of such activities. Also, if the structure of many HR organizations prevents the ability to take the time required to build out meaningful predictive analytics. The volume of transactional work minimizes the opportunity to consult at the strategic level required to build out metrics, identify and build out data required for impact.


Applying analytics to HR functions does not receive as much attention till date as it received in other functions such as IT, sales, CRM, finance, procurement. Some of the fear is the traditional fear of math and statistics, or because people don't understand how to make HR quantifiable and quality-based at the same time. In general terms, many HR Professionals have gravitated toward this profession since analytics, math, programming, etc. are not their strengths, nor interest in many cases, even if they can appreciate the value. They have not been trained in this area. They are used to reporting quantity, such as how many employees attend classes and how many applications are received, but it is more threatening to think of having to increase the number of VIABLE candidates, for a position, or how many people learned and improved as a result of training. So, it is less of fear and more of initiatives to tap the benefits from analytics in HR. The technology required for HR analytics is also a barrier. The majority of people attracted to HR find technology intimidating and IT funding for HR is usually a low priority for companies. Therefore, many HR departments are left with out-of-date analytical software (or just Excel) that they don't know how to use properly and they are too afraid or lack funding to learn. Perhaps it needs an analysis to understand the reason behind HR not adopting Analytics. The basic fault is the way HR professionals have understood their profession. Their background and education have not prepared them for analyzing Data. Used as they are to relying on information gathered through contacts and kept by them in excel format, which would not have been updated. They also have not learned the skills required to do the analysis. Maybe they think it is not their cup of tea. Data Analysis requires analytical bent of mind. Few possess this.


HR can use this golden opportunity to polish themselves, correct the data and learn from mistakes. By holding back, you do not achieve what you want. HR needs to shed its inhibition to stay relevant. HR are generally regarded as people-oriented people. Since people are different than products, raw materials, and production units, you have been brainwashed to feel that analytics of any type is an attempt to commodities human intellect. Another point of fear is that analytics can be manipulated to prove any point and may dehumanize the uniqueness of each individual. While it’s essential to measure work performance on an input and output basis. Though many HR professionals are fearful that they may lose their identity, they should also look at the advantages; those adding real value will soon have analytics to validate the efforts for higher compensation and benefits.


There are a few bottlenecks for widely adopting HR analytics: You can't see where you're going, or how to get there, unless you know where you are; and the analysis of pertinent numbers are necessary to do that. However, there are a few bottlenecks for widely adopting HR analytics: 1). HR professionals have not been trained in analytics. 2). Most companies don't have one CoE analytics, where all analytic data is pulled, so it's not at all uncommon for data to be all over the place and not accurate enough to be put on a dashboard, 3). HR needs to take a deep, hard look to see how well they understand the businesses they support and what is relevant data for them to report back. Ask your clients what's important to their business and give them the data they will need to be successful in the future.


HR need a deep understanding of the organization, how it works and what analytics is relevant in an HR context. Analytics is the language that CXOs speak and HR has to learn to speak their language and also retain their softer side too. That also means being speaking the language of the customer - Finance, IT, Sales, Marketing etc. - in a way that demonstrates your understanding of their challenges. You then become true partners in building new futures for employers. Everyone complains about bad data and how tough it is to get data out of the "systems," but the reality is there is no conflict between emphasizing the "soft skills" side of things in HR and measuring yourself on a relatively few and impactful analytics, sharing that info with the business and focusing on continuous improvement. It's really not that hard to do--pick the right measures, get a baseline of data, continue measuring, take action to improve and be transparent in sharing the data. The business will respect you for it and appreciate the leadership in trying to make things better.  To use analytics properly and well, a person needs to understand 1) The structure and limitations of the dataset itself; 2) the meaning of the data (the "soft" or feeling side of things 3) what relationships are plausible and 4) the limits of valid interpretation of statistical data.


Analytics is a vital component of any business as they give you valuable insight in making better decisions. HR departments are chuck full of information and big data. They have so much at their disposal and at their fingertips, and yet many of them still do nothing with all this great information. Those HR professionals who can bridge the human side of HR and also provide the big data to the folks that make the decisions affect the communities of companies are worth their weight in gold in today's business world. More specifically, HR analytics helps either A: Confirm what you know about your business and support your choices or B: Provide you with data to make better strategic decisions. The fear of analytics can likely be traced to the fear of the 'unknown.' These numbers paint a different picture...With respect to HR, adding that 'human touch' to data may be the best way to present your findings. Great analytics is not just numbers or statistics, they are the story behind the data. Enthrall your clients, tell great stories and encourage them to ask what's next. Ask how analytics can help you understand your accomplishments, identify areas that need extra attention and go ahead, make more informed, strategic choices. Fear not, the data will set you free.  


Math skills and people skills are not mutually exclusive, indeed, the dual factor skills are on strong demand. Analytics is related to technology and math, it's a tragic mistake to assume tech or math skills and "people skills" are somehow mutually exclusive. IT pros certainly can and do understand HR metrics, and HR folks can run linear regressions 'till their hearts content. Dual factor skills, are harder to find, but not at all mutually exclusive. Analytics represents an opportunity for both departments to become more strategic through their partnership. HR become savvier at data-driven decision making by working closely with IT and other functions. Nobody's toes will be stepped on if we're walking side by side, looking in the same direction. Everyone in management or any kind of strategic role needs to be able to work with data and understand basic statistical methodologies and their implications in the real world.


People should be at the heart of management and strategy. Both HR and everyone in management, especially in strategic roles, needs to have a basic understanding of statistics- and what are 'fair and helpful' interpretations and what are not. HR leaders will be respected and listened to when you truly understand the business, what is most important for the business, and how you in HR can contribute to that. The most respected and valued HR leaders think about the business issues first and align their HR agenda to the business needs. The trick is: the answers are different for different businesses, you just have to overcome the fear and embrace it bravely and practice it continually.












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