Category Archives: HR analytics

Thriving in a Data-Driven World

It’s impossible to have a conversation about recruiting these days without talking about the role of data.

Magnifying glass and documents with analytics data lying on tablSo, I suppose it’s no surprise then to hear John Sullivan, author and professor at San Francisco State University, focus his opening keynote presentation at Recruiting Trends 2016, at the Hilton in Austin, Texas, on the role of data in the hiring decision-making process. (Recruiting Trends, which was acquired by LRP Conferences last November, is being held this week in conjunction with the Talent Acquisition Tech Conference.)

During his keynote titled “Forget the Hype: Data-Based Recruiting Reveals What Actually Works,” Sullivan told attendees that employers need to be much more data-driven.

If you ask CEOs what the biggest challenge is that they’re facing, human capital turns out to be No. 1, Sullivan said. “What’s not so good is that we’ve been a challenge for four straight years,” he continued. “And if you’ve been a challenge for four straight years, it means something needs to change.”

These same CEOs also said they believe recruiting the right talent has a huge impact on business success, Sullivan added.

So, if the impact is that significant, he said, that begs the question, “How come [recruiters] have no money?”

“I would argue it’s because we don’t make a very good business case,” Sullivan said. “We say we hired 20 people, but we don’t say those people brought in $20 million.”

In a fast-changing world, he explained, data tells you what works and what doesn’t work. But you need to be looking at the right data, he added. Google at one time looked at a candidate’s GPA, but the research found that grades made no difference in the quality of talent it hired—so it stopped paying attention to that metric.

“Stop having opinions about what’s the best source for hiring people,” he said. “Sure, you can have opinions, but if you want to influence hiring managers, you’re going to want to have facts that back your recommendations up.”

Sullivan also pointed out that CEOs care about quality of hire, and you should, too.

Most employers pay close attention to metrics such as the cost of hire, he said, but they should be focusing their attention instead on measuring the impact of their hiring decisions.

When you hire Cleveland Cavaliers basketball star Lebron James, what you should be measuring is the impact he’s going to be having on your organization over the next 10 years, he said.

In other words, employers need to be thinking about the big picture.

Sullivan also pointed out that most companies don’t measure the failure rates of the people they hire, but should. He used the example of birth control, where there’s a 9-percent failure rate. If birth control doesn’t work, he joked, you might end up with 20 years of misery. Well, the same could be said of hiring. If you get it wrong, that bad hire could be in your organization forever.

Changing of the Guard at Google

By now, many of you may have read that Laszlo Bock is stepping down as head of Google’s people operations, passing the baton to Eileen Naughton, who currently is vice president of sales and operations in the United Kingdom and Ireland.

The news was first reported last week by Fortune.

Some of you may recall Bock was HRE’s 2010 HR Executive of the Year—and for good reason. Though only four years at the helm of Google’s HR organization at the time, it was already quite clear that he brought a fresh new way of thinking to the HR world.

As then Google CEO Eric Schmidt pointed out in our October 2010 cover story, “Building a New Breed,” “Innovation and data are at the core of who we are at Google, and Laszlo applies those same principles to HR. He drives cutting-edge people programs and uses rigorous analytics to guide decision-making—all in the name of finding, growing and keeping great Googlers.”

If you’re looking for a single place to go to get at what some of the “cutting-edge people programs” are, I suggest you pick up Bock’s 2015 book: Work Rules!: Insights from Inside Google That Will Transform How You Live and Lead. It’s all there.

Last year, the National Academy of Human Resouces also acknowledged Bock’s extraordinary contribution to the HR profession by naming him a Fellow in the Academy.

Unlike Bock, who held HR posts at General Electric before joining Google, Naughton is the latest example of an “outsider” taking the HR reins of a high-profile business.

Before joining Google, Naughton served as president of the Time Group and vice president of investor relations for Time Warner. She also served as president of Time Inc.

The Fortune story points out that she is one of the highest-rated managers at Google by employees and is “a founding member of Google’s women’s organization, Women@Google, along with former Google exec and current Facebook COO Sheryl Sandberg.”

Like Bock (who is staying on as an adviser to CEO Sundar Pichai), she will report to Alphabet (Google parent company) CFO Ruth Porat and will oversee HR in its entirety, including diversity and inclusion (which, like at many Silicon Valley companies, continues to be a weak spot for the firm, though one it’s making great strides to address).

Only time will tell, of course, how Naughton will build on Bock’s legacy at Google. Will she be able to view HR through a very different lens, much like Bock? Who knows—maybe her lack of HR experience will be an asset in that regard(?) But this much is certain: She has a tough act to follow.

5 New Upcoming Roles for HR

I just came across this interesting piece on Forbes site in which contributor/digital nomad Kavi Guppta shares what he thinks will be the five most interesting new roles HR will play in the coming years.

While some of the titles, (manager of employee engagement, director of learning and diversity officer) seem pretty safe, the last two titles are worth a deeper look here:

Mindset coach:

An overworked workforce is an unhappy workforce. Wellness programs or policies inside companies are a powerful resource to keep employees happy, healthy, and focused. A Mindset Coach will institute important programs that ensure individuals create good habits in their day-to-day work experience. These good habits go beyond the realm of regular exercise and healthy eating.

A proper wellness program will include work-life balance processes, stress management and therapy programs, and facilitating an open dialogue around mental health and illness to remove much of the stigma that plagues the conversation and ailments. Again, the Mindset Coach will work closely with an Employee Engagement Manager and devise interactive ways to encourage participation and openness across the workforce. He or she will also collaborate with the Director of Learning on educational programs.

Talent & repertoire manager:

Sports franchises and the entertainment industry have long benefitted from internal scouts with an eye for great people. Companies should enjoy the same. The corporate world is full of recruitment firms that can pass along talented individuals, but who is looking out for the organization from the inside?

While talent recruitment may fall on a hiring manager or executive, a fully dedicated Talent & Repertoire Manager can be the eyes and ears on the ground for specific industries. He or she will have great relationships with top recruitment firms, and should also be known for having a good relationship with incubators, ecosystems or industry communities. He or she will also be responsible for navigating transformative trends in the talent marketplace–salary expectations, hot skillsets, and prospect track records–that will be crucial to the competitive offers an organization may submit to potential prospects.

According to Guppta, companies that utilize a specialized approach to HR will remove much of the “nanny-like” perception the department has famously faced inside organizations:

HR will no longer be known as the stuffy and stiff department that keeps everyone in line. Instead, it’ll be a vehicle for progress that will facilitate positive corporate culture transformation where employees and leadership have a stake in that change.

While there’s no guarantee these five job titles will prove to be the difference between success and failure in the future, it is nice to look ahead at the novel ways HR might bring more value to an organization.

 

Temp Jobs: 3 Million and Counting

New research from CareerBuilder and Emsi (Economic Modeling Specialist Intl.) shows more companies will be tapping into the temporary labor segment of the labor pool, with temporary employment expected to add 173,478 jobs from 2016 to 2018 – an increase of 5.9 percent.

The analysis was reportedly based on data pulled from more 100 national and state employment resources.

“Today, nearly 3 million people are employed in temporary jobs, and that number will continue to grow at a healthy pace over the next few years as companies strive to keep agile in the midst of changing market needs,” said Kyle Braun, President of CareerBuilder’s Staffing and Recruiting Group:

“Opportunities are opening up in a variety of occupations and pay levels, and this is a trend we’re seeing in a wide range of industries and company sizes.”

Click here to see CareerBuilder’s list of fast-growing occupations for temporary employment from 2016 to 2018.

To further bolster the claim that temp jobs are here to stay, in a Harris Poll study commissioned by CareerBuilder and completed in December 2015, 47 percent of employers reported that they plan to hire temporary or contract workers in 2016, up slightly from 46 percent last year. Of these employers, more than half (58 percent) plan to transition some temporary or contract workers into full-time, permanent roles.

“Temporary employment benefits both sides of the labor market. Hiring temporary and contract workers helps companies stay flexible and adapt quickly to changing market demands,” Braun said. “For workers, it opens doors for those who want to utilize various skills, build relationships with different organizations and explore career options.”

More proof that temporary jobs are now a permanent fixture in the labor landscape. Is your organization ready to embrace the temp trend?

Using Data to Drive Health Outcomes

Given the hour (8 a.m.) and the setting (the Aria Resort & Casino in Las Vegas), Ronald Leopold, M.D., wasn’t so sure that the time was ideal this morning for a talk centered on getting the most out of employee-healthcare data.

Nevertheless, Leopold—the national practice leader of health outcomes at Willis Towers Watson—soldiered on in the opening session of Human Resource Executive’s Health and Benefits Leadership Conference’s second day, delivering a lively presentation that focused on harnessing healthcare-claims data to better control coverage costs.

In “Doing the Math: Data-Driven Health Outcome Strategies for Employers,” Leopold first asked attendees to rate, by a show of hands, their comfort with data analytics on a scale of 1 to 5, with 1 being the lowest and 5 the highest.

While a scattering of audience members indicated the highest level of comfort with data analytics, and a few ranked themselves as “4s,” the clear majority considered themselves to be “3”s—“not bad, but leaving some room to improve,” noted Leopold.

His goal at that moment, he said, was to help attendees better understand available data “to make the best [benefits] decisions on behalf of their employees.”

In 2016, “we are poised for a new era,” said Leopold, “where we see healthcare costs starting to trend slightly upward.”

For employers, being ready for this uptick entails making efforts to lower employee health risks—implementing effective wellness programs and making plan-design changes that encourage employees to become more responsible for their healthcare, for example—and, in turn, lower healthcare costs.

Leopold urged attendees to “demand the story” beyond typical metrics such as average employee hospital stays and number of employees with a given disease or condition, for instance.

This type of descriptive data “doesn’t always give us a lot,” said Leopold.

“Go deeper, and get diagnostic data to find out why” these numbers are what they are, “and do predictive analysis as well.

“Look at data and use algorithms—which you in HR may not have, but carriers will have, and some consultants will have, and data aggregators will have—to determine [your population’s] health risks,” he continued.

“This,” said Leopold, “is practicing predictive analytics. Then we can see what’s likely to happen in the future … and we’ll get better results.”

 

Study: Core HR is Moving to the Cloud

In the early days of the Cloud, some predicted that while certain HR functions — talent acquisition, for example — would be well-suited for the medium, security concerns and the desire for customization (especially among large companies) meant that core HR functions would continue to reside in on-premise solutions. That’s turned out not to be the case, as evidenced by PwC’s latest Annual HR Technology Survey, which finds that 44 percent of organizatiCloud illustrationons have moved their core HR functions to the Cloud (aka Software as a Service) and an additional 30 percent plan to do so within the next one to three years.

“Moving HR to the Cloud is a question of when, not if,” says Dan Staley, a PwC principal who leads the HR technology practice.

For many organizations, however, the move has included some turbulence: More than half of the 650 companies surveyed say their organization’s “lack of readiness to give up customization and embrace the SaaS mindset” was a major stumbling block during implementation.

“Letting go of customization causes some angst for companies — they think they can do everything that they could do with their old, customized on-premise software but then find out they can’t,” says Staley.

The comparatively rapid pace of SaaS updates — patches that are released every month, new releases every six months — also takes some getting used to for organizations accustomed to on-premise updates that took place every three to four years, he says.

The study also finds that although transitioning to the Cloud makes it easier organizations to deploy mobile solutions — primarily because many Cloud vendors offer robust mobile apps to go along with their products, says Staley — many companies are failing to realize mobile’s full HR potential. For example, although 59 percent of respondents say it would be beneficial for managers and employees to use their mobile devices for performance feedback, only 18 percent of companies actually use mobile for their performance-management processes.

“Mobile is being more widely used, but organizations have got to take a ‘why not mobile’ approach to most of what they do — the capabilities are there, but they have to deploy it,” says Staley. “It hasn’t happened as quickly as it needs to.”

HR departments have moved relatively quickly in embracing mobile, he says. Two years ago, only 30 percent of survey respondents said they utilized mobile for HR-related tasks; this year’s survey finds that 70 percent do. Still, says Staley, much of that includes transactional work such as workflow and timesheet approval.

Companies have also failed to devote the necessary resources for taking full advantage of data analytics — even though they consistently say it’s very important to them, says Staley.

“I’m a little surprised — organizations prioritize analytics, but we found that 52 percent don’t have a dedicated HR analytics team and 44 percent don’t have an HR analytics strategy,” he says. “They desperately want the insights from predictive analytics but aren’t doing what they need to do to get there.”

HR Tech Trends to Watch in 2016

“Nobody comes here anymore, it’s too crowded” is one of dozens of quotes from the former New York Yankees all-star catcher Yogi Berra who passed away earlier this year at age 90. The shelf-life and trendiness of many Yogi-isms will sustain due to their classically oxymoronic and clever nature.

ThinkstockPhotos-176693623Unlike Yogi’s quotes, which adorn many a wall and office desk, the factors that influence the appeal, stickiness, impact and longevity of industry trends are a bit more complicated to hypothesize about. In the HR technology domain, for example, some trends take longer to get adopted and explode than others, even when the expected business impact is comparable. Case-in-point: Contrast the take-up of mobile HR technology with that of predictive HCM or people analytics. Both of these trends get much attention, but degree of deployment and usage across organizations varies considerably.

Various operational dependencies can drive which trends take off or not. These include competencies on-hand—e.g., the ability to properly interpret and analyze data and build related frameworks in the case of people analytics adoption; and ability to expertly market a “case for change” if an HR transformation effort is in order. These seem straightforward, but trend adoption dynamics also extend to how the trend is being promoted, and by whom. A grass roots promotion by HR customers and professionals who are positively impacted by a certain trend, combined with effective marketing campaigns by vendors, is a surefire way of giving a trend legs that are both quick and sustainable.

Below are two trends I’ve excerpted from a new White Paper I co-authored entitled “HR Technology Trends to Watch in 2016.” The paper contains nine such trends that are poised to pick up considerable steam.

Technology-Enabled Talent-Management Science. Sierra Cedar recently found that 39 percent of organizations were now involved in some form of talent-management analytics. Great news, but not a panacea, as the lack of analytics-related competencies (e.g., to define the frameworks, interpret data, identify predictive relationships, etc.) persists in most HR departments. That dynamic aside, we should expect to soon see HCM systems guide users as to where to look for relationships across their data ecosystem.  Case in point: An increase in employee turnover might have the system highlight factors that have contributed to higher turnover in the past; e.g., a change in compensation or benefits, cutting back on management training, retirement or even restructuring activities that should perhaps not be counted as regular turnover, using less effective sourcing channels or more aggressive time-to-fill target metrics, etc.

Personalized Engagement and Retention Plans. With three generations working side-by-side for the first time, it is more critical than ever to personalize how employees are managed and through what rewards and recognition levers, basically to the extent of having personalized engagement and retention plans for all key employees. What each employee values in their work experience and career journey over time, in addition to personality tests and team culture or compatibility indicators, might soon become staples within enterprise HCM solutions going forward. Letting a high-potential employee be exposed to different parts of the business might cost almost zero, but, in the end, could be a more effective engagement driver and retention hook than a larger bonus for many.

Steve Goldberg, a principal within Ramco’s HCM practice, has been a global head of HR systems, vice president of HCM product strategy, change-management firm co-founder, industry analyst and HR tech advisor.

Google’s Deeper Dive into HR Transparency

In case you missed it late last week, Google unveiled a new site titled  re:Work  with the motto “Let’s Make Work Better” and the promise of sharing “practices, research, and ideas from Google and other organizations to put people first.”

According to this piece on the Washington Post, “the new site will feature research-backed examples of how Google approaches things like hiring and anti-bias training, providing free public tools such as slide decks and checklists that the company uses internally.”

(Details about the site were shared first with the Washington Post.)

While other organizations have been more forthcoming with their internal data than in previous years, “the breadth and level of detail that Google is publicly putting out there—as well as that it is inviting other companies to share—isn’t common,” the story notes.

“What’s especially unusual about it is Google is not only sharing what they’ve learned, but actually trying to get other organizations to do it better too,” said Adam Grant, a professor at the Wharton School who has worked jointly with Google on research in the past.

But the Post also notes there may be some skeptics who are questioning the efficacy of Google’s policy, especially in light of their less-than-flattering diversity numbers released earlier this year.

So, to possibly allay those concerns, Google’s senior vice president of people operations (and HRE‘s 2010 HR Executive of the Year) Laszlo Bock writes in an intro to the new site that “we don’t want to just talk about Google, because we know we don’t have all the answers and have gotten a lot of stuff wrong along the way.”

Here’s hoping this new site will indeed help companies get the right stuff right the first time when it comes to HR issues.

Report: HR Really Is Becoming More Strategic

Back view of businessman
Back view of businessman

We’ve all been hearing and talking about HR professionals becoming better strategic leaders and business partners for years, so there’s no real surprise here.

But in this report from the Cranfield Network on International Human Resource management, in collaboration with the Society for Human Resource Management and the Center for International HR Studies in the School of Labor Employment Relations at Penn State University, we do have new numbers. And they’re worth noting.

The report, Human Resource Management Policies and Practices in the United States, outlines the results of a survey of almost 700 senior-level HR practitioners in organizations with 200 or more employees.

It finds HR is more often on an organization’s board of directors or executive team and taking sole responsibility for major policy decisions than in years past.

Specifically, in terms of leadership, 70 percent of responding organizations said HR has a place on the board now, compared to 63 percent in 2009 and 41 percent in 2004. Also, two-thirds of responding organizations (66 percent) said they have a written HR-management strategy. As the report states:

“The HR department appears to be moving away from working jointly with line management in terms of where the responsibility lies for major policy decisions across a whole range of HRM activities such as pay and benefits, recruitment and selection, training and development, industrial relations and workforce expansion/reduction.

“In most cases, there has been an increase in either the HR department taking sole responsibility for these activities or line management taking responsibility (but at a much lower absolute level), with a concurrent reduction in the number of cases where both parties collaborated on the activity led either by HR or by line management. On average, line management is most active in the area of training and development, and least active in establishing pay and benefits policies.

“This trend implies that HR and line management roles may be becoming institutionalized, with each party focusing on its own responsibilities. The increasing regulatory environment may be playing a part here, with firms needing clear guidelines around responsibilities to ensure compliance with regulations and standards.”

This last sentence certainly underscores what we’ve been hearing lately as well!

The report also confirms the use of technology as a foundation for increased strategic HR leadership, with 83 percent of organizations using HR-information systems or electronic HR-management systems and 67 percent using employee self-service options.

Interestingly, according to the report, HR departments remain involved in the development of business strategy, either from the outset or through consultation, although their involvement has declined slightly (ranging from 80 percent in 2004 to 78 percent in 2009 to 76 percent in 2014/15).

Also, interestingly (and it’s hard to pinpoint what’s behind this), there was a decrease in the percentage of HR departments not consulted when the organization was going through a merger, relocation or acquisition between 2004 and 2009 (8 percent in 2004 and 4 percent in 2009); however, in 2014/15 the percentage returned to 9 percent, a level similar to that reported in 2004.

On a more positive note, though, the report states …

” … more than one half of HR departments report that they are consulted from the outset in such situations, which has remained stable since 2004 at 54 percent to 61 percent (depending on the type of organizational change), an indication that HR continues to be involved in processes vital to the success of organizations.”

 

How Managers ‘Game’ Performance Reviews

I just came across an interesting piece by Alfredo Behrens on Harvard Business Review’s site that takes a troubling look at how managers can (and apparently do) misuse employees’ performance reviews. Many times, he says, such trickery — albeit unintentional — can come back to hurt a company’s bottom line.

In his piece, the author, a professor of global leadership at Faculdade FIA de Administração e Negócios in São Paulo, Brazil, recounts how he joined a large U.S. organization and was assigned an employee who provided “the worst secretarial assistance I have had in my entire life.”

After realizing his predicament, he spoke with a colleague about how to best handle the situation.

The advice he received? “Her performance review is coming up. Give her the highest possible rating.”

Why? Because, the colleague told him, “It’s the fastest way to get her invited to work in another division.”

I am ashamed to admit it, but I followed her advice and, sure enough, the secretary was snatched up by a manager in another division. Evidently this kind of dysfunctional behavior is not uncommon; in Brazil there is even a term for it, “people trafficking.”

Behrens says managers also use similar techniques when trying to hold onto the talent they wish to keep for their own little domains, by giving talented employees low-to-middling reviews with the hopes that such workers’  talents will not be discovered and taken away from their department for use elsewhere internally.

“This kind of behavior can badly hurt the company,” he says. “All those low-ranked but highly valued employees were at risk of jumping to a competitor, of course, just as my incompetent secretary was moved around the company instead of being removed completely, as she should have been.”

And while there is a growing  chorus calling for the end of annual performance reviews entirely (see HRE Senior Editor Andrew R. McIlvaine’s recent take on the topic, for example), Behrens offers a question for companies that “aren’t quite ready to throw out” their performance-review processes:

If performance-management systems are so often reviled, ignored, or gamed, do we really know how well we’re managing talent? How many good people are being held back by bad managers?

Those are certainly two interesting questions to ponder the next time  you’re filling out a direct report’s performance review. Are YOU the bad manager who is holding talent back?