{"id":7108,"date":"2017-04-28T07:45:47","date_gmt":"2017-04-28T05:45:47","guid":{"rendered":"https:\/\/www.strimgroup.com\/en\/?p=7108"},"modified":"2020-07-11T09:33:53","modified_gmt":"2020-07-11T07:33:53","slug":"challenges-people-analytics","status":"publish","type":"post","link":"https:\/\/www.strimgroup.com\/en\/blog\/challenges-people-analytics\/","title":{"rendered":"Essential Challenges in Workforce Analytics"},"content":{"rendered":"

The People Analytics World 2017 in London<\/strong> is only a few days back; the impulses varied and valuable. There are numerous opportunities and risks in People Analytics. At the beginning of February Andrew Spence already highlighted main\u00a0challenges. I have subsequently edited these in an abridged version<\/span>.<\/span><\/span><\/span><\/span><\/span><\/p>\n

<\/p>\n

I am excited about the role People Analytics will play in transforming organisations.\u00a0 I have seen some real success stories where organisations have incorporated more data-driven decisions about people and work. David Green highlights some great case-studies in his article, 20 People Analytics case-studies, which includes, Virgin Media, who reduced sickness absence rates from 9% to 4% saving the business \u00a3750,000. There is clearly a journey to be taken where we move from our current starting point, where we often distrust the data we have on employees, to a place where we can better predict sickness absence, attrition and productivity<\/strong>.<\/p>\n

Most organisations are already on this journey to some degree. The percentage of companies that believe they are fully capable of developing predictive models<\/strong> doubled this year, from 4% in 2015 to 8% in 2016<\/strong>, according to research by Deloitte, \u201cGlobal Human Capital Trends 2016\u201d<\/a>.\u00a0\u00a0 However this journey will have some challenges that we will need to overcome.<\/p>\n

People Analytics can play a key role in reinventing organisations<\/strong>.\u00a0 However we need to resolve some of the structural challenges to truly succeed.\u00a0 I covered some of these themes in my recent presentation, The Role of HR in Reinventing Organisations: Embracing People Analytics<\/a>, at the Workforce Analytics Summit in Sydney.<\/p>\n

\"\"<\/a><\/p>\n

Despite the hype, there is low adoption of People Analytics at the moment \u2013 here are some of the challenges that I think we need to address and also some suggestions of how WE (in the broadest sense) can overcome these challenges. As always, I would welcome your views on the challenges, and especially ideas, and examples of how to overcome them.<\/p>\n

Challenge 1 \u2013 We prefer \u2018gut feelings\u2019 to make people-based decisions<\/strong><\/span><\/h3>\n

\u201c80% of HR practitioners say their company leaders still rely on \u2018gut feelings\u2019 to make people-based decisions\u201d\u00a0 according to a survey of Human Capital Institute members in partnership with Oracle<\/a>. What\u2019s wrong with using \u2018gut-feelings\u2019 to make people-based decision? Professor Rob Briner from Bath University explains in his article What\u2019s the evidence for\u2026Evidence-Based HR?<\/a> \u00a0that \u201cour intuition is a valid source of evidence, albeit a weak source.\u201d Daniel Kahneman, in his book \u2013 \u201cThinking, Fast and Slow<\/strong>\u201c<\/a> described two main types of thinking well with their inherent biases.<\/p>\n

When you are under time pressure for a decision, you need to follow intuition. There is nothing wrong with using our intuition or gut feeling, but as Kahneman has said \u201cyou should not take your intuitions at face value\u201d<\/em>. So back to the challenge for those with skills in People Analytics, if your business customers do not believe that data is useful then they will not ask for it, or use it, or believe in it.\u00a0 Which is a fairly big challenge!<\/p>\n

So how do we overcome this challenge? Maybe there is a middle way between the fast and slow lane?<\/p>\n

What you can do:<\/strong><\/p>\n

Make sure the boss \u2018gets\u2019 using evidence-based data<\/strong>.\u00a0 If you are the boss, then make sure your new hires also \u2018get\u2019 it. Make intuitive decisions more data-based AND our data-based decisions more intuitive<\/p>\n

Challenge 2 \u2013 The Peak of Inflated Expectations<\/strong><\/span><\/h3>\n

In HR we have always had business problems, statistical knowledge and access to piles of data, so why the hype around People Analytics now?\u00a0 Well the Cloud and Big Data sales machine is probably talking to your boss right now.\u00a0 You know the pitch, \u201cAnalytics pays $13.01 for every dollar spent\u201d. <\/em>Managing expectations on people performance with the CEO should be your job and as mentioned, People Analytics has delivered some good early results, but one of the biggest dangers right now is far too much hype. Since 1995 Gartner has been measuring The Hype Cycle<\/strong>, the promise of emerging technologies, and shows five key phases of a technology\u2019s life cycle.\u00a0 Is People Analytics in danger of succumbing to the hype before it delivers benefits?<\/p>\n

Peak of Inflated Expectations: <\/strong>\u201cEarly publicity produces a number of success stories \u2013 often accompanied by scores of failures. Some companies take action; many do not\u201d<\/p>\n

Trough of Disillusionment: \u201c<\/strong>Interest wanes as experiments and implementations fail to deliver.\u201d<\/p>\n

So what <\/em>if the CEO gets excited about HR once in a generation you might say?\u00a0 What happens if we set expectations too<\/em> high for People Analytics and do not deliver?\u00a0 It will not be the first time that HR has over-promised and under-delivered based on \u201cbest-practice\u201d.\u00a0 At some point you will need new recruits in a competitive market which needs new software, but there\u2019s only \u00a0so many times you submit a business case with a decent ROI.\u00a0 What you really need is some early positive results.<\/p>\n

What you can do:<\/strong><\/p>\n

Set realistic expectations on people analytics \u2013 aim low \u00a0and over-deliver. Start with a specific Business problem. Learn from the early adopters.<\/p>\n

Challenge 3 \u2013 HR doesn\u2019t need Big Data, it needs Big Questions<\/strong><\/span><\/h3>\n

\u201cWithout data you are just another person with an opinion\u201d\u00a0W. Edwards Deming. But, \u201cWithout questions, you are just another person with data\u201d. There is a danger that People Analytics is a solution looking for a problem and in the \u201cscientific method as an ongoing process\u201d<\/a>, the generation of interesting questions is a key step. To do this we need to know the business<\/strong>.<\/p>\n

I had a client a few years ago, who trained a group of HR Business Partners as 6-Sigma Black Belts.\u00a0 After the training, they demanded a data dump from Peoplesoft. \u00a0\u201cWhat problem are you trying to solve?\u201d and the reply was \u201cWe don\u2019t know yet until we\u00a0see the data\u2026\u201d. The example highlights the need to solve business problems not analyse data.\u00a0 Strategy is all about making choices, so if you run an analytics team, generate as many questions and hypotheses around a particular problem area as you can by casting the net widely.<\/p>\n

What you can do:<\/strong><\/p>\n

Generate many wide ranging questions and hypotheses which solves business Problems. Coach Business Partners and HR into developing hypotheses and sharing the insights back to the business<\/p>\n

Challenge 4 \u2013 We need the right tools to do the job<\/strong><\/span><\/h3>\n

This paper is worth reading, \u201cHR and Analytics: why HR is set to fail the big data challenge\u201d<\/strong><\/a>\u00a0 (Angrave et al, 2016)\u00a0 published in Human Resource Management Journal. As you might expect from the provocative title, they don\u2019t hold back :- \u201cthe HR analytics industry, which is largely based around products and services, which too often fail to provide the tools for HR to create and capture the strategic value of HR data.\u201d. <\/em>In other words, our HR Systems, data and reporting tools might not help us answer the business questions we have.\u00a0 Many HR operational systems were simply not designed for analytics, and although they are improving, I expect to see more sophisticated analytics functionality in subsequent software releases.<\/p>\n

What you can do:<\/strong><\/p>\n

Keep discussing your needs with your Technology Partners. Collaborate with others in the industry to source great Tools.<\/p>\n

Challenge 5 \u2013 No confidence in the underlying frameworks<\/strong><\/span><\/h3>\n

To use a house analogy, there is no point having cameras & sensors, unless the house is structurally sound in the first place.\u00a0 We need to have a roof, secure doors and running water before we can add sensors that optimise our heating, detect poisonous gas, detect intruders etc. As Max Blumberg says in his article, People Analytics: Who\u2019s fooling who?<\/a>\u00a0\u00a0 \u201cif like most people you don\u2019t believe in your organisation\u2019s competency and performance management frameworks, then you certainly aren\u2019t in a position to believe in the results of statistical analysis based on data generated by these frameworks. As the old acronym GIGO says, Garbage In, Garbage Out.\u201d<\/em><\/p>\n

What we are crying out for is a theoretical framework to test our hypotheses about people, behaviour, productivity and organisations<\/strong>.\u00a0 We are not there yet, but I am optimistic that over the next few years we can develop the skills and knowledge to increase our confidence levels in people management.<\/p>\n

What you can do:<\/strong><\/p>\n

Stop doing people analytics until you\u2019ve fixed your frameworks. Collaborate with academia and peers in other organisations.<\/p>\n

Challenge 6 \u2013 Show me the Money<\/strong><\/span><\/h3>\n

The problem is, you can show the C-Suite pretty data visualisations of their organisation showing attrition, gender balance,\u00a0 and average commuting time, but the hard truth is the CEO will only really listen when you link it to Revenue and Profits<\/strong>.\u00a0 When it comes to employees, the holy-grail is increasing employee productivity.\u00a0 We need to link as much as possible to employee Productivity to get \u2018buy-in\u2019.<\/p>\n

What you can do:<\/strong><\/p>\n

Develop your own internal measures for employee productivity. Try and link your initiatives to improving employee productivity.<\/p>\n

Challenge 7 \u2013 Structural issues with HR Operating Models<\/strong><\/span><\/h3>\n

I have been speaking and writing about some of the structural issues with HR Operating Models for many years (see for instance, Is your HR Operating Model Fit for the Future?<\/a> \u00a0If the supporting structures for HR analytics are not in place, then the probability of success is lower. A couple of structural issues with HR Operating models that many orgs sill grapple with are:<\/p>\n

Working in silos<\/strong>.\u00a0 In HR we have developed some great experts over the last few years (e.g. talent, learning, reward etc) yet we have also become a function of specialists creating more silos which makes it harder (not impossible) to work together as a whole to deliver HR (Business) strategy.<\/p>\n

The role of HR Business Partner<\/strong>.\u00a0 The role was introduced as a strategic partner and account manager for HR Services, however there have been challenges.\u00a0 Many orgs are on their 3rd<\/sup> or 4th revisions of this role and HR BPs are key to solving business problems as key customers for an analytics service.\u00a0\u00a0 However we are in a transition phase, as described by \u201cMost HR BPs won\u2019t cut it\u2026\u201d \u00a0\u00a0from Luc Smeyers and \u201cStop Hiring Data Scientists if you\u2019re not ready for Data Science\u201d from Greta Roberts.<\/p>\n

We will never have the optimal HR Operating Model with managers, systems, HR experts working seamlessly together.\u00a0 However we can strive to continually improve the model using People Analytics to help rethink many of our HR programmes and influencing how we deliver our people management.<\/p>\n

What you can do:<\/strong><\/p>\n

Learn some of the lessons from others in HR Transformations over the last few years. Ensure Business Partners have good analytical skills and are inquisitive about the business. Provide coaching on basic statistics and people analytics where needed. Continually evaluate the efficacy of our HR and Management initiatives.<\/p>\n

Conclusion<\/span><\/strong><\/h3>\n

My \u201cgut-feeling\u201d is that People Analytics will help reinvent organisations.\u00a0 We are in the early stages of a journey and we can all help by sharing methods, learnings and positive results.\u00a0 We need to keep an eye on some of the near-term challenges as we move forward. \u00a0\u00a0One key action within our control is to set realistic expectations and solve specific business problems.\u00a0 This can get our business partners more interested into a different way of working.\u00a0 The technology industry will probably evolve to roll-out improved offerings with time.\u00a0 And our evidence base should get better as we improve data quality and start to ask better informed questions.\u00a0 Although the ecosystem I refer to is complex, with diverse vested interests, we should continue to encourage sharing and collaboration as much as possible.<\/p>\n","protected":false},"excerpt":{"rendered":"

The People Analytics World 2017 in London is only a few days back; the impulses varied and valuable. There are numerous opportunities and risks in People Analytics. At the beginning of February Andrew Spence already highlighted main\u00a0challenges. I have subsequently edited these in an abridged version.<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[686],"tags":[283,706,419],"class_list":["post-7108","post","type-post","status-publish","format-standard","hentry","category-workforce-analytics-2","tag-analytics","tag-business-partner-en","tag-operating-model"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.strimgroup.com\/en\/wp-json\/wp\/v2\/posts\/7108","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.strimgroup.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.strimgroup.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.strimgroup.com\/en\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.strimgroup.com\/en\/wp-json\/wp\/v2\/comments?post=7108"}],"version-history":[{"count":8,"href":"https:\/\/www.strimgroup.com\/en\/wp-json\/wp\/v2\/posts\/7108\/revisions"}],"predecessor-version":[{"id":12348,"href":"https:\/\/www.strimgroup.com\/en\/wp-json\/wp\/v2\/posts\/7108\/revisions\/12348"}],"wp:attachment":[{"href":"https:\/\/www.strimgroup.com\/en\/wp-json\/wp\/v2\/media?parent=7108"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.strimgroup.com\/en\/wp-json\/wp\/v2\/categories?post=7108"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.strimgroup.com\/en\/wp-json\/wp\/v2\/tags?post=7108"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}