What's new in HR Analytics? #1

Analytics is one of the most talked about concepts in HR but adoption rates are still struggling to gather pace despite respected industry luminaries like Josh Bersin predicting that 2015 will be the year that it goes into orbit. Well, we’re half way through the year and the rocket still seems stationary. Why? Well from talking to HR analytics practitioners on both the in-house and vendor side, it seems a common blocker to adoption is fear (as in too much) and knowledge (as in too little).

Whilst I believe analytics will eventually become part of HR’s standard repertoire, I also believe it is incumbent on those of us that are passionate about this subject to help move things forward even if it is in a small way. Consequently, this is the first edition of what will be a regular (weekly, fortnightly or monthly – I haven’t yet decided) round-up of the most interesting articles, studies, guides, videos and podcasts on HR analytics. Those aspiring to take a seat on Bersin’s rocket will hopefully find it a helpful, informative and (at times) irreverent read.

What’s behind the surge of interest in People Analytics? | Adam Grant & Cade Massey | Knowledge@Wharton (read full piece or click on video link below) 

First up this week is a fascinating discussion between professors Cade Massey and Adam Grant, who jointly lead Wharton’s people analytics initiative. Speaking ahead of the recent Wharton People Analytics Conference, Massey and Grant walk through the typical HR lifecycle and explain how data is being used in hiring, onboarding, constructing teams, performance management and compensation to improve decision making within organisations. One of the key challenges encountered by both professors is why more firms haven’t adopted this. Grant describes the conundrum he is attempting to resolve as thus: “Why don’t more organisations do this? And how can you get senior leaders to realise that just because sometimes these variables are hard to measure doesn’t mean you shouldn’t bring better science to them?”

HR Analytics – 10 years behind | Luk Smeyers | HR Tech World blog (read full article)

Grant and Massey concede that HR is playing catch up with other functions like IT, Marketing and Finance in using data to inform its decision making. Our second article by Luk Smeyers of iNostix on HR Tech World goes further, suggesting that HR is 10 years behind. Smeyers argues this should be a wake-up call for HR and emphasises the importance of a strong business case and executive sponsorship in order to get analytics in HR off the ground. You may want also want to check out iNostix’s excellent HR Analytics Insights blog.

Starting the Workforce Analytics Journey – the first 100 days | IBM (download full white paper)

Getting started is also the theme in an excellent recent white paper from IBM, which features contributions from acknowledged HR analytics thought leaders like Jeremy Shapiro and Jonathan Ferrar. In his foreword, Shapiro muses that whilst interest in the topic is booming, HR as a whole is still learning how to set up effective analytics capability. The first 100 days are critical to the success of any business initiative, which makes this white paper all the more indispensable for would be HR analytics leaders. The aspirants are guided through a series of steps, collectively designed to lead to maximise impact within those priceless first 100 days.

What HR Metrics Are Investors Most Interested In? | Inside HR (read the full article)

The IBM white paper advocates the identification of a quick win within the first 100 days that will have a business impact or uncover an insight that will generate executive discussion. What this quick win should be will obviously be different for each organisation, but this article in the always readable Inside HR may provide some clues. It reports on a joint study between Harvard Law School and the Investor Responsibility Research Center Institute (IRRCi) into the growing interest from the investment community into the correlation between human capital and financial outcomes such as return on equity, return on investment and profit margins. The study establishes a meaningful connection between the two implying that “companies with a convincing HR story and strong data to back it up are likely to receive a welcome reception from many institutional investors.” Read the entire ‘The Materiality of Human Capital to Corporate Financial Performance’ study.

“Companies with a convincing HR story and strong data to back it up are likely to receive a welcome reception from many institutional investors.” Aaron Bernstein, from Harvard Law School’s Labor and Worklife Program

In recruiting, how important is cost per hire? | David Green (read the full article)

We started with Josh Bersin this week, so perhaps it is also appropriate to finish with an article by David Green (not sure who he is) that is part-inspired by research from Bersin by Deloitte. The study found that organisations at the highest level of talent acquisition maturity spend two times more per hire than those with the lowest impact. Green’s article takes this finding and others from the Bersin study on first-year attrition and time to hire to demonstrate how a higher cost per hire can actually lead to better value and a lower total cost to the organisation.

Well that’s the first instalment of this series in the can. Please let me know what works and what didn’t so future editions can be refined. Please also send me a message on LinkedIn with details of any items that you believe should be featured.

About the Author

David is a Director at Cielo and has helped a number of organisations design data driven talent acquisition programmes that drive effectiveness, growth and competitive advantage. He also speaks, writes and chairs conferences on HR Analytics and other key tenets driving the seismic change in the future of work.

Connect with David by email, LinkedIn or Twitter 

You may also want to read some of David's other articles:

• Cost Per Hire: "It's the wrong recruiting metric, Gromit..."
• 11 Key Takeaways from #PeopleAnalytics15
• 7 HR Analytics Firms to watch
• Robots vs Humans - where is the Future of Work headed?
• HR Analytics - The New Goldrush?
• The 20 best HR Analytics articles of 2014
• 10 Predictions for HR & Recruiting in 2015 - Part 1 and Part 2
• Never mind the bureaucracy, here's Punk Rock org structures...
• The Who's Who of HR Analytics Influencers - Part 1, Part 2, Part 3and Part 4 
• Is HR ready for the Big Data & Analytics revolution?
• Part 1 and Part 2 of our fictional HR Director's journey into the world of HR Analytics

Keywords: HR, Human Resources, HR Analytics, People Analytics, Talent, Recruiting, Hiring, Talent Acquisition, Talent Management, HR Metrics, Cost Per Hire, Workforce Analytics, Talent Analytics, Data Driven HR