Long reads

Amazing insights you can learn from people analytics

21 Feb 2019 By Robert Jeffery

Getting to grips with your workforce data can bring better returns than you realise

You can’t write about people analytics without including a few numbers. So here are some for starters: in a 2018 CIPD survey of more than 3,500 business professionals, only 39 per cent had access to people data for decision-making purposes. And only just over half (52 per cent) were actively using people analytics to tackle business issues.

Of those outside the HR department, meanwhile, just 35 per cent felt their HR team were ‘experts’ in people data. And yet, despite the fact the profession has further to go to match the level of insight areas such as marketing enjoy with their approach to analytics, there are examples of remarkable performance and productivity being powered by a focused approach to workforce metrics.

Below, People Management collects a few of the most intriguing, from the government agency rethinking recruitment to the data business which has learned to love soft skills – and everything in between.

Stop misspending your recruitment budget

Many great analytical insights start life with a question. For Andrea Owen, head of recruitment at the Office for National Statistics (ONS), that meant asking: “Are we recruiting the right people?”

The Newport-based government agency is comfortable crunching numbers, but Owen says that didn’t mean it was generating the right insight: “When I came into the team, we had loads of numbers being reported but they told me nothing. They told me how many buttons were pressed and how many people were processed [during recruitment] but not how good we were at filling priority roles.”

Owen and her team scrutinised two areas in particular. By looking at how people progressed after they joined the ONS, they could see some specialists who were hired externally were leaving because they wanted to work in financial services. The realisation helped hone recruitment channels to target technical roles at people more likely to stick around.

Meanwhile, a focus on rates of internal applications showed some roles could be adequately filled from within the ranks. By making this information available in real time, hiring managers can now decide whether or not they need to spend more on advertising externally. Best of all, the more straightforward metrics cut down on the reams of information managers were being sent. “No one has queried why they don’t see all that data that was previously being produced,” says Owen.

Find the quiet champions in your ranks

Network analysis is a fast-growing discipline that blends HR insight with technological rigour – and for credit data business Experian, it’s offering a sideways take on the topic of performance.

By taking information about the connections between colleagues, network analysis aims to give a truer picture of who is most measurably productive and influential. Meta-level data from email exchanges, calendars and other networking tools is collated – though the actual content is removed – to provide a ‘heat map’ that goes beyond the traditional org chart and often subverts expectations.

“We look at it partly to think about key influencers within teams, or to look at how knowledge transfer takes place, but it’s also useful from a gender perspective – are there differences in the way males and females communicate across the organisation?” says Oliver Britnell, Experian’s global head of workforce analytics and HR strategy. 

The results uncover ‘hidden stars’ who might not shout about their achievements but are quietly hugely influential. This feeds into more informed decisions about promotion and how and when to develop people. Ultimately, it also influences reward, as part of a bigger statistical model involving predictive flight risk and other factors. And Britnell believes it will have a positive effect on the gender pay gap too.

Understand what’s really going on with diversity and inclusion

As one of Britain’s most successful charities, the RSPB naturally assumed it was doing the right thing on diversity, but a deeper dive uncovered some areas that needed action, according to Catriona Corfield, equality, diversity and inclusion manager.

The organisation identified a list of key analytics it cross-referenced with diversity statistics, to examine whether different demographic groups experienced variations in pay, access to training, redundancy rates and disciplinaries and grievances. It led to a range of actions, including unconscious bias training, which have already brought about a rise in senior female managers.

“It’s helped make the case to strengthen our investment in equality,” says Corfield. “You might think your organisation will magically buck the trend, but without efforts to embed diversity and inclusion into your culture, you won’t see your analytics shift.” But, she adds, relying on analytics “only gives half the picture”. You need to supplement hard numbers with qualitative measures: for example, the RSPB realised women weren’t having career conversations when it asked them about progression.

Attach a real monetary benefit to your HR initiatives

Energy supplier SSE is arguably the most advanced organisation in the UK when it comes to measuring human capital – it knows exactly how much its average employee delivers to the bottom line (£173,000). Its commitment to transparency extends to a comprehensive annual human capital report, and it uses its in-depth analytics to calculate that a fully trained apprentice, for example, returns £4.29 to the economy for every £1 invested – shared between the individual, the employer and society.

“We think a strong society is important,” says director of human resources John Stewart. “We want to be a responsible organisation. And the whole reframing of human capital is an important part of that.”

Naturally, attaching value to HR actions helps justify investment to senior leaders. But building such a robust case is an undertaking in itself: it starts, says Stewart, with a ‘baseline’ metric that can be added to through a range of qualitative and quantitative measures. When it comes to training, for example, that means sending ‘mystery shoppers’ into sessions to look at value for money.

SSE found that deep and technical courses offer the greatest return on investment. “One thing that surprised me was the disparity between the training programmes we analysed,” says Stewart. “You think you’re putting people through something and getting them a qualification, then getting them a job. But it matters exactly where people go, and different interventions take people down very different career paths.”

Decide what you’re really looking for in new hires

“We’ve hired a lot of people over the last few years,” says Adi Koblenz, head of talent acquisition at fast-growing OVO Energy. “And it means we’ve got a meaningful size of population to look back and learn from.”

By pooling data from its applicant tracking system with information on learning and development and performance management, the business has been able to look forensically at how often its predictions on who would progress and perform well turned out to be accurate in reality. It found having a personality that fitted into the culture was more important than technical ability – which led it to rethink key aspects of its recruitment process. Out went some skills-based testing and in came ‘holistic’ interviews that built a better picture of a candidate’s motivations. 

Crucially, HR has now become integral to the interviewing process, while job descriptions have also been rewritten to reflect the attributes that really deliver. Attrition is down ‘substantially’ since the initiative began and Koblenz adds: “Data has become an incredibly important focus for the business, and it’s an integral part of our talent acquisition now.”

Find the truly great leaders – not the self-promoters

Greig Aitken, group head of people strategy and insight at Royal Bank of Scotland (RBS), is a long-time convert to the power of people analytics. But, he says, that doesn’t mean all numbers are equal: “People tend to measure everything that moves, rather than what matters. Often, they want to measure the things that are easiest to get to – employee turnover, for example, is a very low-impact initiative.” It’s not always that straightforward, he adds: “High employee attrition could be a good thing if you are downsizing in certain parts of the business.”

One thing RBS believed was worth looking into was quality of line management. Aitken’s team built a powerful leadership index by taking in data from 360-degree reviews, engagement survey results and interviews with staff. As a result, 4,000 managers across the business have individually tailored reports on their capabilities, and by comparing the results with turnover and exit interviews it has been possible to prove the adage ‘you join a business but leave a manager’ is certainly true.

So convinced is RBS in the power of better leadership that the index has been incorporated into performance management systems. “Evidence-based HR allows you to have fact-based discussions about the difference people make to the business,” he adds. “Gone are the days when you gave someone five out of five in their performance review because they’re a good guy. It means we can get to an outcome-based conversation very quickly.”

Empower your HR business partners to drive change

“We have a fairly traditional workforce, but we have to look to the future,” says Nikki Gibbons, director of OD, transformation and HR at Bracknell Forest Council in Berkshire. That desire to introduce new skills and a fresh culture was the catalyst for an analytics-led project to quantify current capabilities. 

HR business partners have proved key: by conducting deep conversations with business leaders about their teams and their operational needs, supplemented by an evidence base, the council was soon identifying “hidden pockets” of talent that hadn’t been obvious before – for example, individuals working in social care teams who had the right skills and mindset to become transformation managers. 

Already, retention data is moving in the right direction and spending on consultants is down. But the process involves persuasion as much as analytics, says Gibbons. “There’s been a bit of resistance because managers say ‘I haven’t got time to talk to business partners about this’. But if the analytics tells us your casework is increasing, which means your turnover will go up further as a result, we’ve got to sit down and look at why people are leaving.”

But, she adds, it’s a two-way process to make the metrics count. “If you don’t win the hearts and minds of key managers, you’ve just got stats on a piece of paper.”

Work out what actually motivates your millennials

A lot of the effort that goes into workforce analytics is focused on localised metrics involving individuals and teams. But HR can also turn its gaze to the bigger picture: at electronics giant Philips, head of talent intelligence Toby Culshaw and his team aggregate labour market and other macroeconomic data to help the business make crucial decisions.

Such decisions shouldn’t be made without access to good data, he argues. Which is why when the business was considering expanding its operations in Cambridge, Massachusetts, it gathered information about talent availability, compensation, local demographics and future economic trends. It ended up turning Cambridge into its North American headquarters as a result.

Along the way, Culshaw has gained a insight into what motivates employees, particularly younger staff – while purpose is often cited as the main thing they look for, he says, in reality it is a baseline condition they always expect to be present. What really counts is the opportunity for development. 

“The way to get started with analytics is to be comfortable with data,” says Culshaw. “You have to understand the difference between correlation and causation, then translate that into something the business cares about.”

Get the senior staff you deserve

Most large businesses use some form of assessment centre to understand senior leaders inside and out before they enter the door. Experian is no different – but it has used metrics to take its level of insight up a notch.

Britnell’s team looks at leaders in the couple of years after they undergo its “fairly extensive” set of assessments, to ask whether the individuals who excel on testing are the same ones who make a difference to the business.

The reassuring answer is that by and large they are, but the highest performers tend to demonstrate strong performance on key ‘soft skills’, such as interpersonal sensitivity, a learning approach and ‘dutiful behaviours’. That revelation has helped hone both the assessment process and wider development efforts within the business. 

But Britnell cautions against allowing algorithms to replace human judgement in other aspects of recruitment, where the potential for bias is greater. “You need to be careful when it comes to recruitment,” he says. “When using automated decisions on screening, for example, there is too much bias in the system that already exists within your organisation for that to be credible.” 

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