Don’t just do something – sit there!
Leaders are conditioned to leap into action to meet challenges. But what if remaining calm and simply listening is what the people around you need in such moments?...
Human Resources
Using data to show the value of HR
People analytics leaders believe CHROs should use data to demonstrate HR’s real value.
CHROs are under growing pressure to demonstrate the business value of the HR function. Consequently, people analytics is rapidly moving up their agendas. New digital tools offer HR functions the power to quantify more aspects of HR, tying these metrics directly to value, performance, and business objectives. We spoke to two people analytics experts, James Rands at audiology and optical retailer Specsavers and Daniel Kusmanto at semiconductor equipment manufacturer ASM, to find out what CHROs need to know to capitalize on the data opportunity.
Moving from data to decisions
HR has a lot of data at its fingertips, but it must be able to convert that access into business value. For example, recruitment and attrition data might seem to be a marginal metric with limited impact on performance, but it can be truly relevant in terms of strategic workforce planning.
“If you set strategic growth on your revenue, you need to plan the workforce to support that revenue while considering the internal and external talent landscape,” says Kusmanto. “How can you get there if you don’t hire enough, or don’t retain your solid performers, or don’t grow your team members fast enough? You have to come back to the impact on the business as compared with a floating value.”
Access to detailed data on different segments of the workforce significantly improves the insights available to HR leaders. For example, it is much more valuable to be able to compare productivity between teams than looking at the metrics for the company overall. “You can look at attrition data from several angles,” Kusmanto expands. “Instead of just looking at total and voluntary attrition, it can be valuable to look at high performer and high potential attrition. Those are the people that you don’t want to lose.”
Armed with detailed data on employee behavior, HR can prepare a laser-guided response. For example, if the data shows that employees with certain skills frequently leave when they hit a specific seniority level, HR can focus on improving career prospects and opportunities for workers in that group who are approaching that particular rung on the ladder.
Accessibility and the frequency with which data is collected are also critical. Rather than collecting data once a year to be buried in an annual report, HR functions should collect data frequently to drive real-time decision-making. “We have created core tools like dashboards and reports to support our leadership,” says Kusmanto. “These can provide data and insights at fingertips for our leaders in making their decisions.”
Used intelligently, data can reflect the value of HR to the rest of the business. “We’ve just launched a new brand, and we’re working hard on training our retail colleagues to have confident conversations about it in store. We can clearly see the correlation between the stores that are really engaging with that learning and positive customer experience,” says Rands.
Specsavers’ HR team has also focused on democratizing data across the organization. It has created a tool for the retail support team that merges people data with customer satisfaction scores, sales performance, learning engagement, and core metrics including turnover and attrition. “They can take that data into a store and have a really meaningful conversation with an optician or partner,” Rands suggests, “demonstrating that, when a certain thing changes, customer satisfaction or retention improves.”
It’s very important for leaders to have a broad overview and connect the dots across departments to get more holistic insights.- Daniel Kusmanto, Global Head, HR Analytics at ASM
Breaking down barriers to people analytics
“It’s very important for leaders to have a broad overview and connect the dots across departments to get more holistic insights,” says Kusmanto. “You need access to business and finance data to inform your decisions. How can you benchmark business units internally if you don’t know which are performing well on which product, to which customer, and in which region?”
HR teams need to be aware that they can’t simply mash together HR data and that pulled from other teams. But as Rands points out, the prospect of wrangling unstructured or chaotic data shouldn’t put HR teams off altogether. “We have to avoid waiting for everything to be clean, sorted and organized, because the technology moves too quickly,” he confirms.
Kusmanto suggests that AI “can bring you closer to the tool itself,” allowing HR staff to make analytics requests in natural languages and creating frictionless pathways to previously arduous or reduplicative processes. AI has huge potential for automating data analysis and insight generation. The key, however, is to decide which processes AI can undertake, and which – at least for now – require human oversight. “We still need to make sure that we are asking the right questions in the first place, and have a solid and clean data structure,” says Kusmanto.
Nobody joins HR to be a data expert, and very few come from a data background. Investing in helping HR teams understand how to consume and use data is vital.- James Rand, Head of People Systems and Insight, Specsavers
How CHROs can unlock the value in people analytics
People analytics teams are forging ahead but what can CHROs do to advance the cause?
Rands suggests that data skills capability is an area where CHROs can make a big impact. “Nobody joins HR to be a data expert, and very few come from a data background. Investing in helping HR teams understand how to consume and use data is vital.”
He highlights that Specsavers has a data analytics apprenticeship to train people who are not analysts to harness data to add value into the business. “Across the business, we’re asking how we can become more data-driven and improve skills. It’s about finding a way to use data to drive the business forward.”
For Kusmanto, the most important factor is to nurture a general faith in the concept: “It is important to have HR close to business and a CHRO who truly believes in the value of people analytics. Half the battle is won, and everything falls into place.”
Experts
Related
A trust test for leaders
Trust is foundational in leadership, yet is more of a science than an art. Answer the questions below to assess whether an absence of trust is affecting your leadership. ...
Cultural Calibration in a multi-layered world
Master Cultural Calibration: open mind, explicit norms, and regular alignment to keep cross-border collaboration clear and productive....
The human change challenge: How Sanofi gets workforce buy-in for AI
As transformation accelerates, HR leaders should keep their people up to speed, explains Sanofi’s Raj Verma....
Learn Brain Circuits
Join us for daily exercises focusing on issues from team building to developing an actionable sustainability plan to personal development. Go on - they only take five minutes.
Â
Explore Leadership
What makes a great leader? Do you need charisma? How do you inspire your team? Our experts offer actionable insights through first-person narratives, behind-the-scenes interviews and The Help Desk.
Â
Join Membership
Log in here to join in the conversation with the I by IMD community. Your subscription grants you access to the quarterly magazine plus daily articles, videos, podcasts and learning exercises.
Â