Hello Analytics! . . Wait, WHAT! . . Why Analytics?!

Investment in People is not a new subject, yet it is the most sought after business agenda for organizations across the globe.  Why?  Why now?  Is it the global markets crisis?  Unemployment or underemployment?  Job cuts?  Rising pressures to perform?  Changing business landscapes?  Alignment or re-alignment of organizational strategy?  Changing People culture?  Renewed focus on diversity at workplace?  Or a strategic focus on People to make a positive impact on the ROI? . . You may find or name more reasons, the name of the [New] game is People Analytics.
 
Let's examine some interesting yet contrasting views from across the globe that are summoning us for well calculated, sound, decisions on People at workplace.

Advanced Economies

• Rising regulatory pressures to improve organisational conduct, to treat customers fairly; BFSI industries are undergoing a cultural shift (Financial Conduct Authority of the UK, Dodd-Frank Act & Consumer Financial Protection Bureau of the US)
• Frequently rising - out in the open - cross industry unethical practices and immoral events (Volkswagen Emissions Fraud, Global Forex Scandal, JP Morgan London Whale)
• Business sustainability, organisation growth and profitability agenda; to improve customer experience, - on-going customer engagement - and to address organisation-wide cultural changes
  

Developing Economies

• Growth, in spurts, with countless start-up births and casualties; People engagement framed as one of the primary reason for start-up failures (Intention of Millennials to move on is greater in emerging economies (69%) – Deloitte Millennial Survey 2016)
  
• Rising infrastructural development and national capital investment; need for economic diversity and business policy simplification, for ease of doing business, to invite foreign investor interest
  
• Technology innovations and disruptive business models that are changing the way People connect at workplace; both blissful and painful People experiences
  

Not hearsay and not a revelation either - a recent study "Learning to Fly", from AON Hewitt in 2015, suggests ". . that the CHRO is a critical stakeholder in defining the strategy of a firm.".  This re-affirms that an organization’s prime focus is on People at workplace – their role in business strategy and business performance. 
 
CHRO’s strategic agenda is next on the radar.  We ask some indicative and leading questions that pave the roadmap for measuring success.  Again, only if there are proven methodologies to quantify and measure success!

• What are the existing and trending cultural issues within the organization and the industry?
  
• How do we establish a shift in organization culture, its impact, on business performance and HR effectiveness?
  
• Is there an impact of cultural practices and symbols on People engagement or People well-being or other People aspects?

---

• What capabilities are associated with the future direction and strategy of the organization?
  
• Which capability development techniques and pedagogies are most effective?
• Is the 3E model (Education, Exposure & Experience – 10:20:70) universally applicable on all People development practices?

---

• What mix of experience and education is most likely to give us our next talent?
• How do we qualify and quantify the potential of a talent?
  
• What are some of the early indicators of possible talent attrition or mass exodus?
  

---

• Does the technology architecture equate into our strategic People practices?
• Is technology simplifying or creating more layers and complexities?
  
• Is our technology investment leading to improved and more efficient People processes?
  

---

• What is the impact of past strategic HR initiatives on organisation’s ROI?
• What are the shifts and changes in the global economic environment, their impacts, on our business strategy and our People?
  
• Have we made necessary investment in methodologies to analyse relationship of our People practices to business performance?
  

---

For long organizations have made decisions based on intelligent intuitions and often undertaken initiatives to replicate well surveyed best practices.  Yet, today, there is a strongly felt need for making more conscious and weighted efforts to design and develop solutions around People – to scientifically study the overall impact of this machinery on organization’s ROI.  From identification and selection, on-boarding, retention, capability development, talent management, employee engagement, collaboration, diversity, employee performance, team performance, project performance to business performance – organizations are looking at Analytics to pave the way for making more sound decisions.

---

“Managing attrition challenges in the Outsourcing business for over a decade one thing is certain – reporting attrition trends is essential to our business, predicting attrition based on past data is a norm but predicting employee behaviours will change the way we build our business and plan our way into sustainability.  The industry recognizes this need for analytics around people in our business."

~ Aabha Nanda, VP & Head Corporate HR at EXL Service

---

Wait, has anyone treaded into this vast domain of People Analytics?  Are there any sophisticated, tried and tested (proven) models that may be contextualized and utilized?  Not a comprehensive list, but here’s a quick highlight of select industry practices.

Companies favor job candidates with stellar academic records from prestigious schools — but AT&T and Google have established through quantitative analysis that a demonstrated ability to take initiative is a far better predictor of high performance on the job.
 
Harrah’s Entertainment has extended their customer selection analytics approach to People decisions, using insights derived from data to put the right employees in the right jobs and creating models that calculate the optimal number of staff members to deal with customers at the front desk and other service points.

Starbucks, Limited Brands, and Best Buy—can precisely identify the value of a 0.1% increase in engagement among employees at a particular store.  At Best Buy, for example, that value is more than $100,000 in the store’s annual operating income.

JetBlue created an employee-satisfaction metric around its people’s willingness to recommend the company as a place to work.  This “crewmember net promoter score” (modelled after the customer-satisfaction metric) has been used to study the impact of compensation changes and to help determine executive bonuses.  Employees are asked annually on their hiring date if they would recommend the company, so JetBlue can effectively monitor employee engagement monthly.

Sysco’s analysis revealed that operating units with highly satisfied employees have higher revenues, lower costs, greater employee retention, and superior customer loyalty.  The company can efficiently identify what actions by management will have the greatest impact on the business.  In six years it has improved the retention rate for delivery associates — who provide customer service and build customer relationships — from 65% to 85%.

This is one is our personal favorite – to protect its investments, the soccer team AC Milan created its own biomedical research unit. Drawing on some 60,000 data points for each player, the unit helps the team gauge players’ health and fitness and make contract decisions.

​Does it mean that there are well-established and prevalent People Analytics practices and or ready tools to deploy into business?  No!  Let’s take a look at the global trends ~  Deloitte University Press – Global Human Capital Trends 2015 Report.
​

There’s dearth of talent across industries and capability gaps are on the up-rise.

‘Culture & Engagement’ is one of the most significant challenge across industries and regions.

---

"The biggest challenge to HR Analytics today is the half-knowledge that has been created around this term. Analytics has been confused with Analysis; Big Data is seen as the same as Analytics and many practitioners think that Statistics is the be-all and end-all of Analytics!  Nothing could be further from the truth!  Whilst all of these are important adjuncts to Analytics (specially HR Analytics), they represent only one aspect of the entire value chain.  As Google has been saying for quite some time now, Analytics comes from Insights and Insights come from Analysis, which comes from the proper evaluation of the relevant Data.  At the core of HR Analytics (or Analytics of any kind) is logical reasoning.  The ability to think in a structured, comprehensive fashion; to formulate the right questions are at the heart of the Analytics process."

~ Arunav Banerjee, Founder Adyant Consulting
specializes in Organizational Effectiveness solutions

---

All unadulterated and glaring gaps are in our faces.  Let’s face the music!  Is there one specific reason that may reflect on these issues?  No!  There are numerous challenges and hurdles, some technical and others that relate to the level of acceptance, for the lack of use of Analytics around People at workplace.  You may find these relevant to your business and operations context.
 
Technical Challenges:

1. Reporting is different from Analytics and organisations fail to recognise this difference
2. Interest exists; return on investment is not understood; there is no proof of concept
3. Lack of data, data points and associated intelligence on data analytics
4. Role of technology is not best represented and is the least recognised in-house capability
5. Research methodologies are the bed rock – the only foundation – but organisations do not see the benefit of investing their time into these initiatives

 
Other Challenges:

1. Lack of Skill and of Will – No proactive and or continued “C”-level support and sponsorship
2. Management focus is on tactical day-to-day business challenges; bye bye, Strategy
3. Dashboard, Checklists and MIS exist, yet the business orientation is draconian
4. Stakeholder expectations are not well understood or explored
5. Organisations associate ‘sharing employee data’ with ‘power loss’

 
Where does one start?  What should be the approach?  Are there ready products in the market?  Are products the way forward or should one undertake a solutions route?  Can we leverage our existing business and operations capabilities?  Do we need to upskill our People?  Does that mean additional costs?  Can we establish a case for investment into People Analytics?  How does one embark on this journey?
 
We recommend a tailored approach, leveraging your existing in-house business and operations potential, towards the development of comprehensive People Analytics capabilities.
 

• Educate yourself; middle, senior or top-level management – we all need to understand and recognise the potential of analytics around People at workplace
• Seek guidance and support from your professional network and advisors
• Engender an environment of collaborative research and learn from experiences
• Develop a case that suits your business environment; each organisation stands differently on data, technology, skills, use of products and tools, and level of acceptance and maturity
• Educate your stakeholders; lend a hand, help them cross the bridge
• Take small steps; don’t jump into the ocean – learn to swim in the lakes and rivers, first!
• Establish trust, practice People inclusion and celebrate your wins at every stage
  
• Design your “method-to-madness”, stay humble and enjoy the journey
• Continue to establish People Analytics capabilities, based on practical and true evidences and outcomes - to establish change and embed ‘Culture & Engagement’
• Weigh your investments – the associated risks; find and work with proficient advisors

 
We invite more questions and enquiries on the way forward, approaches and the design of a road-map towards intelligent use of organizational data to establish robust People Analytics capabilities. 
 
Continue to watch this space for more.  You may write to us on people.analytics@profisor.com.

---

Credits:  AON Hewitt "Learning to Fly" Study 2015, Deloitte Global HR Trends 2015, Deloitte Millennials Survey 2016 & HBR.