While technology provides HR people with a wealth of data, accessing this data and transforming it into meaningful business intelligence remains for many a major stumbling block when trying to apply a successful HR technology strategy. This is Mary Cowlett, a freelance journalist at Human Resources Magazine, starts her article entitled “Transforming data into business intelligence remains a stumbling block for HR technology strategy” by quoting Steve Foster, strategic consultant and HR expert at HR services provider NorthgateArinso, who asserts: “HR directors generally have an awareness of the data they can access and what that can be used for, but there is a deep frustration about how to turn that awareness into something tangible.”
The above argument is supported by “The Business Impact of Talent Intelligence”, a study carried out on more than 600 global organisations published by the human capital institute and talent intelligence consultancy Taleo last March. Interestingly, this study has revealed that most HR practitioners have better access to less important, tactical data than they do with regards to data on strategic issues. In response to these findings, David Wilkins, Vice President, Research, at Taleo, commented: When asked about performance and compensation metrics, top performer retention was considered the most important issue for HR pros, but top performer flight risk and top performers without a career plan were the two worst performing metrics, in terms of reliable access. The metric HRDs have the best access to is average performance review scores − which they consider to be the least important.”
Cowlett further explained that one of the major barriers to effectively using HR technology for more sophisticated workforce analytics is that such objectives are simply not factored in. “Output has to be linked to input, but when planning a technology solution, often people don’t do it with a view to how they are going to get the information out,” he said.
Similarly, it looks as if at the implementation phase there can be a tendency for HR insight and intelligence to get lost in more immediate concerns around business processes. “Organisations will spend a year on setting a project up, then say they will come back to the metrics and the analytics later,” he added.
Unfortunately, some organisations are still entrenched in the deluded belief that even SaaS (software as a service) and cloud-based HR solutions are simply about automating backroom processes to deliver cost reductions, explained Cowlett. Indeed, many excuse such practices and attitudes by arguing that the majority of HR practitioners hold strongly to a mindset that looks at reducing people issues to number-crunching as stripping the soul out of what they do. However, a more likely answer is that, as a function, HR is simply not equipped enough in the necessary competencies to handle sophisticated analytics. In this regard, Cowlett quotes Vincent Belliveau, senior vice president EMEA for cloud-based talent management software solutions provider, Cornerstone OnDemand who said that: “In general, HR people lack the financial expertise and modelling skills to analyse and extract maximum value from the amount of data available to them.”
Neil Roden, partner at PwC and previously group director of HR at RBS for 11 years, went a step further by calling for more attention to analytics in the teaching of CIPD qualifications at a Ceridian analyst event on 20 March. Roden stated: “Not a lot of HR people do much on metrics and analytics, despite the fact we all know that’s how most chief executives and chief finance officers think. Too many in HR struggle even to say how many people are employed in the organisation, let alone what the trends are.”
In a nutshell, if the modern HR function is to become a strategic business asset to the organisation, then it becomes imperative that practitioners start speaking in business terms and have the facts and figures to back this up, maintains Cowlett. One of the key success factors is the quality of the data collected. Belliveau emphasised that this has to be consistent across the organisation in order to report against it, which means determining what information the business needs for success, and agreeing on some core metrics, which can be expanded in progressive steps.
Finally, Cowlett said that in this scenario the good news is that there is now a new generation of emerging HR professionals who are more comfortable with technology and making connections with reliable outside data sources, such as benchmarking-type information.
“Many of the HR staff we deal with on a day-to-day basis tend to fall into the Generation Y category: they are tech-savvy and have a well-rounded knowledge and first-hand experience of social media and cloud technology,” says Roger Moore, general manager at HR, payroll and time and attendance software provider, Bond Teamspirit.
The extent to which HRDs call on such data is unclear, concluded Cowlett. However, the recent growth in mobile HR apps, such as the pay app, Jobsworth, which was launched in April, offering data about wages and salaries across Europe from the Federation of European Employers (FedEE), is likely to drive up adoption. Many forward-thinking organisations are taking a more sophisticated approach, going beyond measuring even complex data such as quality of hire, core competencies, skills gaps and employee engagement, to managing workforce data in the context of other business information − and using this to drive decisions. This approach is being taken by laboratory supplies and services specialist VWR International, which employs 8,000 staff across 31 countries. Having gone live with a global human capital management platform from Workday at the end of 2011, this organisation is now looking to workforce planning.
“We don’t just want to see what’s happening now, but also address trends, concerns and opportunities so we can plan the resources the organisation needs,” says Patrick Crane, VWR International director of HR services.
What is more, Crane’s organisation is also rolling out a learning management system and is in discussions around importing a similarly cloud-based employee involvement system addressing workforce volunteering, philanthropy, sustainability and well being. Interestingly, Cowlett explains, although the self-service element of these solutions only allows employees to see appropriate information, it is already creating a beneficial social media effect for the company.
“It is enabling our people to connect more with each other around common interests that go beyond the work that they do,” Crane adds. “As a result, we are beginning to see a level of engagement and connectivity we hadn’t envisaged, which ultimately should drive employee retention.”
The recent proliferation of data has had a huge impact on businesses the world over. As the amount of data rapidly increases, many organisations are now finding themselves struggling to identify which HR data is most important to meet their needs, and how to access it. As a matter of fact, seeking to capitalise on data-driven insights in the face of barriers to access has left many organisations looking for robust Talent Intelligence (TI) solutions. The challenge for organisations who value these key talent metrics will be that of developing effective TI systems that provide “timely capture, aggregation, analysis, and reporting of talent data to inform decision making for improved organisational strategic planning and operations”. HR professionals at these data proficient organisations will be better able to contribute to the strategic goals and objectives of their own organisation.
Finally, as the Taleo report rightly concludes, those organisation who do not see and value the importance of Talent Intelligence or are ill-equipped to track important metrics will be faced with continued talent and operational uncertainty and will be at a strategic disadvantage when managing their organisation’s most important asset − its talent.
Ms Camilleri is a researcher at the Foundation for Human Resources Development (FHRD)