Getting off the HR Goldmine

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2 The Value of Measuring What gets measured gets done Peter Drucker But.two things generally happen to data: collected and not used in decisions Analysed but results often not applied

3 The Value of our Data To the naked eye, the gold mine is really a bowl of dirt whose value is yet to be realised.so is our HR data in its raw state and, in order to realise the real value of our data, a process of extraction is necessary

4 Mining the Gold Characteristics of Goldthat we may or may not know: Extremely valuable Sought after Everlasting no known substance that can destroy gold will remain unaffected until moved by the natural forces of earth or by man

5 Mining the Gold Predictive Aalytics Predictive Analytics: The process by which you can predict with confidence what will happen next so that you can make smarter decisions, solve problems and improve outcomes. IBM SPSS

6 Similarly, Getting off the HR Goldmine Mining the Gold NOTHING STRATEGIC WILL HAPPEN SIMPLY BECAUSE THE DATA EXISTS, NOR WILL THE REAL VALUE BE REALISED UNLESS WE EMPLOY STATISTICAL ANALYSIS TO IDENTIFY AND PREDICT TRENDS THROUGH FORECASTING

7 Like the Goldmine. Mining the Gold The HR Database is the most precious collection of data within the organisation that affects all strategic decisions: o Operational ofinancial ocustomer opeople

8 Mining the Data What is Data Mining: The process of analysing data from different perspectives and summarising it into useful information UCLA, California

9 Mining the Data through Analytics Why we should mine our data: o Increase revenue (affected by productivity, efficiency) o Manage costs ( improve efficiency) o Gain insight o Predict trends before they happen

10 Mining the Data Primary Organisational Concerns o Revenue (productivity, efficiency) o Cost Management(efficiency, profitability)

11 The BIG Question: Mining the Data If Productivity, Efficiency & Profitability are IMPACTED DIRECTLY by our people, why are we not surveying our people, or investigating, measuring, analysing and interpreting our HR data as a regular part of the process of creating Business Intelligence?

12 Mining the Data The real problem faced by HR leaders: Not everything that counts can be counted, and not everything that can be counted, counts. Albert Einstein Source

13 The Reality: Shrinking budgets + the need for employees to do more = an urgent need to remove the guesswork and make more informed and accurate strategic decisions

14 What Can our HR Data Give Us? RESIDENT DATA Age Gender Salary Education INFORMATION WE CAN GET Retirement projection; succession planning; HR profile; culture; attitude Productivity by gender Standard of Living changes; market comparisons for employer of choice Knowledge base; HR Quality; ROI Training; Skills composition; internal training needs; Succession candidates

15 What Can our HR Data Give Us? RESIDENT DATA Years of service INFORMATION WE CAN GET Avg.Tenure (All/New ); ROI Recruitment; Tenure x Gender; Tenure x Key Positions Job Category Performance productive segments; Terminations Voluntary/Involuntary Rate; retention rate; termination reasons/patterns; termination trends

16 What Can our HR Data Give Us? RESIDENT DATA INFORMATION WE CAN GET Appraisal Score Productivity by Job Category, Age, Tenure; reward systems; Leave Usage patterns; trends (maternity); replacement costs;

17 The successful use of analytics in supporting strategic HR decision-making is dependent on: o HRIS capability or existence opresence of analytical skills (HR/Compensation Analyst) o Culture of data capture & analysis** o Culture of decision-making guided by data

18 HR Analyst-Emerging but Critical Emerging positions - HRIS Analyst: Identify & provide analytics to develop & refine HR Planning Conduct workforce analysis including retention and other employee activity Report/analyse human capital* data Package metrics & analyses into presentations, reports

19 Five Key HR Metrics Employee Attitude: Job Satisfaction (survey) Staff Engagement (Survey) Culture Management Turnover/Retention: Turnover costs/ turnover rate (Vol./Involuntary) Turnover by Job Category, Gender, Age, Key Positions reasons for termination (affect market positioning: Employer of Choice??)

20 Recruiting: Getting off the HR Goldmine Key HR Metrics Vacant periods/time taken to fill position New Hire performance (appraisal scores) New Hire retention rate HR Quality: Human capital value Training investment (ROI) % workforce with graduate education

21 Key HR Metrics Absenteeism/Punctuality: # minutes/hours late/days absent Dollar Value of Absenteeism Point to Point measure (impact of culture changes on attitudes towards time)

22 Staff Engagement Key HR Metrics Employee attitude towards the organisationand its values Effective engagement comes only through consultation with employees Studies have shown that there is a statistical relationship between employee attitudes (which measure engagement)and business performance (measured by productivity, profitability, employee retention, safety, and customer satisfaction)

23 Getting off the HR Goldmine What is your State of Affairs? HRIS Assessment: modern or archaic data storage? Forms/Data Collection: Simple, clear, frequent? Data Integrity: Data clean & complete? Analytical Skills/Software: Available/unavailable?

24 Analytical Tools Online Survey

25 Predictive Analysis (IBM SPSS)

26 Success Story Predictive Analysis (IBM SPSS) First Tennessee Bank: Over US$25B in assets First Tennessee promises our customers that we will be there for them, that we will power their dreams, Abundance of customer data yet not used to devise any marketing strategies or to understand customers Examine customer s monthly transactions & behaviourto establish trends to better design campaigns Positive Results: Better understanding of customers than had before 3.1% increase in customer response; 20% decline in costs equated to 600% ROI More accurate forecasts -> fewer planning meetings

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28 Get the HR Goldmine Execute the analysis, Grow the business & Sustain your competitive advantage!