the power of predictive employee analytics
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1 the power of predictive employee analytics
2 the power of predictive employee analytics 2 Introduction More organizations are realizing the enormous value of the information they acquire through the principles of big data. The next step: understanding the insights they can achieve through predictive analytics. Predictive analytics is the practice of using information from big data to find patterns that can eventually help organizations make more strategic business predictions including in human resources. Using predictive analytics in your HR strategies can save your organization time, money, and effort while finding and retaining the talent you need to build your business. This white paper will look at the kind of information your organization needs (and probably already has) to start implementing big data decisions, what you can learn through predictive analytics, and what one company is planning to do with predictive analytics. Big Data (noun): A collection of employee, customer, financial, or other data sets so large and complex that it becomes difficult to process using traditional database management tools or data processing applications. Getting the data There are two types of data that can be used in HR analytics: structured and unstructured. If your organization is interested in investing in analytics for HR, it is important to understand that you already have some of the data you will need. Structured sources include the information that is given to you directly by employees or applicants. The information in your HRIS, ATS (Applicant Tracking System), and data that you gather from employee surveys is structured data. There is also information you can use from unstructured data sources, which is gathered from available data streams and not provided Sources of Data ATS explicitly. These data are gathered, for example, from social media sources and postings and online public records. The applicant information your talent management website receives for a particular job opening is structured data; unstructured data could HRIS Structured Employee Survey include information posted on Twitter or LinkedIn about employees experiences at an organization. Unstructured When gathering structured and unstructured data for use in predictive analytics, there are three main ways to ensure the data you get is useful and effective.
3 the power of predictive employee analytics 3 1. Integrate as much information as possible While names, hire dates, and demographic information may be in your HRIS, other useful data may be scattered around your organization in different HR, CRM, and ERP systems. In order to integrate structured employee information from these systems, there are three things to consider: how will you link data sources together, at what cadence should you extract different sets of data, and what options are there for extracting data from each system? Common methods for combining structured employee data are to match employee information by employee ID, , or some unique employee identifier. Imagine building a giant spreadsheet with a row for each employee, and then adding hundreds of columns containing a score or attribute about each employee. This may be a manual process initially, but many HR analytics companies provide tools for automating the integration process and uploading into the analytics platform. The next consideration is at what cadence you will need to report HR metrics. This will vary depending on the size or your organization and the type of metrics you wish to report. If your organization needs to provide metrics monthly and has 1,000 employees, at the end of 12 months, your giant spreadsheet will have 12,000 records. Finally, you will need to develop a strategy for how to extract data from different systems. Most HR systems can be scripted to produce a spreadsheet style report at a scheduled cadence. Newer systems may offer an API or web service, which enables modern analytics platforms to securely request data from that system whenever it needs new data. The trick for most companies is finding the (internal) capabilities, says Bill McKinney, Vice President of talent and strategic development at Thrivent, a nonprofit Fortune 500 financial services membership organization. Thrivent uses predictive analytics and methods such as mining information from social networks to forecast their potential employees success at the organization. Do you have the analytic tools? Do you have the IT support, the tech analytics and then the HR expertise to know what you re looking for? Integration of Data Into One System This kind of integration is common in marketing departments, where the question Employee ID First Name Last Name Hire Date Performance John Heywood 3/5/92 Effective Mary Altin 6/24/07 Very Effective Engagement Fully Engaged Moderately Eng... is how to find someone to buy your product. But HR also needs to have the internal resources to get the most out of HR analytics potential, McKinney says. To me, it s exactly the same questions, except it may be you re selling the opportunity to work with your company, he says. How do you apply some of those analytics to finding someone who s going to be excited and passionate and successful working here? How do you apply some of those analytics to finding someone who s going to be excited and passionate and successful working here? Bill McKinney Vice President of Talent and Strategic Development at Thrivent The capabilities are growing quickly. Many of our clients and prospects are excited about the opportunity to combine structured and unstructured data together and begin to identify the predictive models that enable their organization to accelerate their talent attraction, development and retention strategies, says Patrick Riley, CEO of Modern Survey. The first step is to bring an organization s stakeholders and system experts together and discuss what data you currently have, what new systems are coming, and what data lives outside the company firewall that you want to bring into the metrics conversation Allan Levain 7/8/03 Needs Improv Serge Mastroianni 1/17/13 Effective Disengaged Fully Engaged
4 the power of predictive employee analytics 4 2. Ensure the data is highquality The challenge with unstructured data is that it can be tempting to gather as much as possible with the idea that there is something useful somewhere. Instead, approach unstructured data streams with the same care and discernment as you do structured ones. Sentiment Analysis An example of how Modern Survey s Heat platform can analyze social media data Story Headliners Demographics Dimensions Gaps Sentiments Employee experiences via social media Key Word great place to work Relevance Sentiment Positive While APIs and third-party providers make it possible to gather massive amounts of data, it s important to target that search so you get the best results. Much of the available data is useless, and it s important to make sure the data is clean before it s modeled. It s really a different mindset for thinking about data, McKinney says. Social media is a major source of unstructured data that can be combined with structured data to provide insights into a person s performance and behavior at a company and data can be gathered everywhere: big social media sites like LinkedIn, Facebook, YouTube, but others compensation leader involvement company location including Reddit, TripAdvisor. Anything you re interested in online, it can be a source. Emerging analytics platforms can provide a sentiment analysis of large volumes of unstructured text data. For example, a company could analyze tweets that included the company s name in the last three months, categorize the tweets into keyword topics, and rate each tweet as positive, neutral Negative Positive Negative or negative. The stories we can now tell organizations about what their employees are saying is going to fundamentally change the way HR will develop and manage their talent strategies, Riley says. 3. Set out a clear hypothesis and goals for the data Predictive analytics is not simply dumping a bunch of data in a pot, pressing a button and hoping something useful comes out. It is a targeted analysis that depends on the information you have and the answers you want then coming up with a way to find them. Neil Rae, general manager of North American operations of Transcom Worldwide, a CRM outsourcing firm, uses predictive analytics for their HR strategy. Rae says attrition was a challenge at Transcom s call centers. After mining data, Transcom changed its recruiting focus and the HR team found it was able to hire fewer people to get 500 call-center workers who were still on the job three months after hire. When people hear about big data or mining and predictive analytics, it becomes kind of a shiny object, Rae says. It s important you understand what s impacting your business, and then work backwards from there and ask yourself, what s the business problem you re trying to solve? When that is answered, Rae says, it becomes clearer what sources of data you should be using and how they should be manipulated. And once the data is simplified and mined for insights, the results must be delivered in context. The technology an organization uses needs to get the results to the right people so they can take action and hold people accountable for change. No matter how good your analytics are, your people will still need to act on the information.
5 the power of predictive employee analytics 5 What s possible Select Comfort, based in Minneapolis, manufactures the Sleep Number bed and employs almost 3,000 people. The company s HR analytics program has evolved over time, from tracking engagement and performance to looking at leadership essentials and competencies, onboarding processes, and 90-day check-ins, exit surveys, and talent inventories. Now, Select Comfort is preparing to use the data gathered in predictive analytics. That s a lot of data, says Alixandra Colehour, Vice President of HR at Select Comfort. What we re working on now is finding out where to connect the dots. Colehour says the company is in the early stages of the process, examining the connections that can provide the best insights to help make better business decisions, build culture and boost engagement. Through partnership with Modern Survey, Select Comfort has identified 90-day onboarding survey items which predict retention. Our big focus is, how do we make sure we are hanging onto top talent? she says. We need to understand our talent inventory and engagement levels. And it s not just directors and VPs, it s sales. We have people who sell a million dollars in a year we need to be assured that we can hold onto that kind of talent. Colehour describes Sleep Number as data rich, and says the company keeps tabs on every touchpoint of the customer experience. When that information is overlaid with employee information, It s going to help us in so many ways not just in terms of better employee decisions, but in strategic business decisions as well. Colehour says the company s next step is to expand access to the data results and provide direction on how to act on them. I would say we have built an amazing foundation, and we will utilize Modern Survey s Heat solution to make predictive HR analytics accessible to key stakeholders. We have built an amazing foundation, and we will utilize Modern Survey s Heat solution to make predictive HR analytics accessible to key stakeholders. Alixandra Colehour Vice President of HR at Select Comfort Conclusion Predictive analytics can give insights into your organization that are backed up with real data, not based on hunches or intuition. And in the war for talent, analytics can position your organization to get the people it needs more efficiently. You hear all the time that companies are struggling to find people, McKinney says. And there are tons of people looking for jobs. People are going to be approached for jobs they hadn t even thought about and didn t even realize they had a high propensity to be successful in. You can almost compare it to social media, Rae says. When it came out, everyone put their heads in the sand. The tools were complex and people wondered what the heck they were supposed to do with it. But as more companies saw what it could do for them, more adopted it. Collecting and analyzing both structured and unstructured data will help your organization make decisions about everything from hiring to leadership decisions to performance management.
6 about us Modern Survey measures workforce intensity that fire in your company s belly that makes all things possible. Our human capital measurement software combines feedback, benchmarks, and data from enterprise systems to elucidate the correlation between employee performance and company success. We analyze the stuff your talent management system can t so that you know what to do next. We are Modern Survey. And we are relentless. Find us at Tyler St. NE, Suite 170 Minneapolis, MN (866) modernsurvey.com 2014 Modern Survey
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