How to get over some of the HR analytics humps ...

This week I attended a Round Table event organised by Annapurna Recruitment.  They run a HR Transformation Network and this event was a sub-group of the larger network specifically focussing on HR Analytics.  The event was chaired by Simon Haines from GarnerHaines Workforce Analytics.  Participants at the round table were from organisations at varying stages of their analytics journey as well as from some of the larger consultancy organisations who have a HR analytics capability and Concentra who own an HR Analytics product called OrgVue. The session was structured around three questions and the conversation was open and honest.  I will share some of the main takeaways from each conversation.

Conversation one: How to build a compelling business case and secure budget for workforce analytics

The starting point of this conversation was the need to build credibility and much of this comes from the data.  The group spoke about the importance of a ‘single version of truth’ and the consensus was that achieving this is an important step on the analytics journey but not a pre-requisite to starting it.  What is important is that there are clear definitions and a shared understanding of terminology.  The point was expressed that the data doesn’t even need to be 100% accurate, the finance concept of ‘materiality’ was used and that it is ok to start your analytics journey with ‘good enough’ data, how you present your data using visualisations and how you tell your story will be important in gaining acceptance and credibility.

The idea put forward to drive the business case and built upon by the group was that the HR analytics function would start with a ‘proof of concept’ demonstrating what it could achieve solving a real business issue.  It was acknowledged that it is easier to get buy-in when you have a numerate audience so choose your target sponsors wisely. 

It is also important to decide whether your business case for doing HR analytics is going to address cost or more qualitative factors (or both).  And also being clear where the funding to do analytics will come from, some organisations are finding the funding from their existing HR budget showing that they have the confidence in it as a practice and are prepared to invest to demonstrate this.  Other organisations have more success in getting business sponsors and investment.  

One of the hardest challenges is getting the business to ask the right questions, so a hypothesis can be generated and tested through the use of analytics.  Therefore, in addition to having data credibility, attempt to make sure that the business question that you use to build your proof of concept is a jolly good one!

Conversation two: Bridging the frustration gap, how to connect HR, finance and operations through HR analytics

The conversation was started by an ex-finance person whose first observation when moving into HR was the absence of people in other functions allocated to the relationship with HR, his observation that there is no one outside of the function there to help HR to obtain the data that they need.  How can this be overcome, other than by assigning these roles?

Some organisations found that the relationship particularly between HR and finance got better when HR started to recruit accountants, individuals able to converse about numbers on a similar level, which HR might well have already been able to do but it hasn’t been perceived to be the case.  Other organisations got a bit more radical and put steps in their processes to lock down headcount data forcing finance to interact with HR.  The point was well made that actually HR doesn’t need to worry about building a relationship with the whole finance function, that much of the work finance does is actually backward looking and that it is the financial planners who are more forward looking where it makes sense to invest the effort particular if there is going to be a focus on more predictive analytics. 

The consensus seems to build that to bridge the gap with both the business (operations) and finance the best way was to generate a ‘campaign mentality’; find a true business problem, gather those who can add value, instruct them to ‘bring what they know’ and through a common goal or purpose to work together as a team to solve the issue.

I could therefore see this playing out day to day through the way of working adopted by the HR analytics team which would potentially involve the use of working groups, structured around business issues, meeting regularly to advance the understanding and solve these business issues.  I am having more and more conversations recently about the need for integration within HR and outside HR with the business and other functions and it strikes me that the use of HR analytics might be an important vehicle for achieving this.

Conversation three:  How to secure the key skill sets for effective HR analytics

This was the conversation I was most interested in, wanting to get a view on in particular how organisations were structuring HR analytics into their organisations to understand what skills seem to be the most important. It was also of interest to the CIPD who are developing HR professionals and to Annapurna who are big players in recruiting in the HR analytics market.

What was clear was that there are two roles under ‘HR analytics’; those that need skills in deep analytics to work with the data and those that need skills at the start of the process to identify the business issue and define the hypothesis who can then once the analysis has been undertaken can interpret the data and ‘tell the story’.  It was commented that it isn’t really possible to get one person who can cover off all of these bases and it was widely accepted that it was a challenge. 

The topic of tools was raised and the impact that this has on the skills required by organisations.  The recognition that there are some tools out there on the market that help present the data and drive insight, made simpler by the fact that everyone can have access to the same data and effectively ‘self-serve’.  It is my opinion though that until the value of analytics is appreciated widely, the role of having people responsible for using the insight to tell the story is partly as an ambassador selling the agenda. 

We didn’t really reach a broad conclusion in answer to this question in the time we had. There is both a ‘buy’ and ‘develop’ imperative to building the key skill sets; by hiring analytical people from professions such as consultancy, people proficient in numbers from professions such as finance as well as by build the capability of the existing HR profession through training such as the CIPD’s Leveraging HR Analytics and Data course.

How have you built your business case to do HR analytics in your organisation?  Did you even need to?

What have you found successful strategies for working across finance and the business? Is using HR analytics helping break down those silos?

How are you finding recruiting the skills to build your HR analytics capability? 

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