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HR Analytics How-To's Part I: Goals and Guiding Principles
Organizations that have already developed human capital management as a core competence have enjoyed a continually increasing economic premium. This, in turn, has resulted in the emergence of HR analytics as an essential core competence for Human Resources functions. As interest in HR analytics has grown, so too has confusion, most fundamentally about what it is - and what it's not.
What it is. The goal of HR analytics is to improve organizational performance by better aligning the management and development of people with business goals and objectives. (The goal definitely should not be simply to "prove the value of HR.")
By fostering actionable insights into the linkage between people and business results, HR analytics creates a rigorous fact-based map for refining an organization's human capital strategy and increasing its return on its investments in its people.
For example, an organization might seek to identify what "people factors" are the most significant differentiators between its most successful sales offices and its least successful ones, and then adjust its strategy to target improvement in those factors in particular. As a by-product of this type of work, the credibility of HR is greatly enhanced (and HR's focus on proving its value falls by the wayside).
Guiding principles. We suggest the following four guiding principles when we work with our clients in the design and implementation of HR analytics projects and, more long-term, the development of an authentic analytics culture throughout their organization:
1. Your initial HR analytics projects should be designed to help executives solve burning business problems (e.g., how to improve sales productivity, improve the success of a merger or acquisition, reduce turnover in critical positions).
2. Go for the low-hanging fruit - projects that can produce actionable insights within a relatively short timeframe.
3. An analytics project designed for continuous organizational improvement buys a lot more credibility than one designed to prove that HR has made the right decisions in the past.
4. Don't allow the perfect to become the enemy of good. Conditions for your first project (e.g., data quality, time available) almost certainly won't be perfect, but that shouldn't stop you. At a minimum, you'll learn a lot - and hopefully whet the organization's appetite for more analytics projects in the near future!
Coming next month: HR Analytics How-To's Part II: How to Get Started
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HR Analytics Handbook Now Available for Purchase!
The HR Analytics Handbook by Laurie Bassi and co-authors collects in one handy volume the most vital, practical information on HR analytics. It's available for purchase today in hardcover or softcover from the McBassi Store (including free shipping/handling in the USA).
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Later Today: Complimentary McBassi Webinar
Wondering how Disney, FedEx, IBM, Procter & Gamble, Abbott, and other companies are making "goodness" pay off?
Please join us today (Tuesday, March 13, 2012), at 2:00 p.m. Eastern Time, for a dynamic McBassi webinar featuring authors Laurie Bassi (Good Company and HR Analytics Handbook) and Jim Shaffer (The Leadership Solution), facilitated by Dave Basarab. You'll leave with:
- Hard-nosed evidence that good companies outperform their competitors.
- Insights into the convergence of forces giving rise to the new rules for business success.
- Understanding of the 6 systems that underpin Good Company results.
- The strategic framework to integrate Good Company principles and practices into ongoing efforts to improve your company's performance.
- Ways to sustain the gains rather than create just another "program of the day."
Click here to register now.
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McBassi is a human capital analytics firm that helps organizations improve their performance through more effective management and development of people. We have proprietary research-based measurement methods, the analytic know-how, and a proven track record in serving as a catalyst for change and generating win-win results.
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We can be contacted toll-free at 866.345.5730 or info@mcbassi.com.
Feel free to stop by anytime and join in the discussion on the McBassi blog.
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