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What are we going to cover? What are leaders asking of the HR organization? How do metrics support this? The role of Metrics as an enablement mechanism in HR Transformation Are you measuring the right things? Real world examples In other words Which key data should be shared and highlighted to your executive team Review your data to determine what changes will spur new innovation and growth (Transformational data) Architecture & tools to help accomplish this Understand where your workforce resources should be allocated What does it look like
Over 11,000 US Based skilled and dedicated professionals
Professional service firms offering a full range of Management Consulting services.
We embed metrics into everything we do, both HR metrics and performance metrics.
30+ years corporate experience driving HR Transformation
Russell Klosk, MBA, SPHR, GPHR Paul Thornton, Ph.D. We are a leading provider of professional, technology and management services. Advise | Design | Integrate | Deliver
Organizational priorities are changingShift from transactional to strategic Mission attainment is leadership’s top priority - and innovation is required to enable it Responsiveness and agility are the new key competencies, requiring innovation across three areas: Offerings and services Operation of core functional areas Overall enterprise model (especially collaboration) Operatingmodelinnovation is becoming as important as traditional offering and service innovation. Organizations that outperform focus on this But, collaboration and model reinvention require strong leadership of change, notably in the areas of: Culture Rewards Integration of process and technology Source: 456 CEOs, IBM Global CEO Study, 2004765 CEOs, IBM Global CEO Study 2006
The Question Leaders Aren’t Asking How do I make decisions about human resources with the same rigor as I do about finance or operations? What types of metrics and dashboards empower me (leaders) to accomplish this?
These priorities shape the new Human Capital agenda HR Executives are challenged to ensure the right balance between strategic effectiveness of HR and operational efficiency of the function As people challenges including cultural development, leadership and collaboration become a critical part of achieving innovation, the Human Capital agenda must evolve
A variable and efficient cost model for the HR function with high service levels is required
Organizations require many delivery channels to ensure employee and manager access
CHROs must be able to demonstrate the link between Human Capital activities and business results
The decision to build or buy skills becomes central
Retaining key people when facing a shortage of supply is critical
Organizations must measure and reward executives and the HR function by how they deliver on the critical talent agenda
Developing skills to support growth, innovation, differentiation and customer satisfaction becomes a top priority
Collaboration across the company, channels, and citizens is needed to transform work
What key data should be shared? There is no one magic bullet You must determine what metrics drive organizational capability given your unique business environment If you are looking for a single metric or data element that is everything your HR Executives need you are missing the mark It is entirely about looking at all the relevant data and getting to those that tell a meaningful story for what you are trying to accomplish How do get to this?
Developing your expertise: Metrics & Analytics enable the transformation
Different metrics for different missions Workforce Enablement HR Execution Employee Development
Learning BTO and system outsourcing, maintenance and hosting
Data is used to spur new innovation and growth (Transformation) Identifies areas of focus, and areas for improvement
Workforce Intelligence Architecture “Tie HR to the business”(strategic impact) Business Analytics “Monitor HR performance”(operational effectiveness) HR Metrics “Run the department”(transactional efficiency) Workforce Reporting
Using “Workforce Intelligence” as Your Tool This will insure that … Operational reporting is more comprehensive and efficient Individual application data is integrated You have desktop reporting tools Graphically-rich information is easily utilized Dashboards are user specific You can measure progress against benchmarks and internal targets HR practices and investments can be aligned with enterprise goals Relationships between investment and results can be demonstrated Efficiency Transactional Effectiveness Operational Strategic Impact
Do we really measure the HR Value Proposition Actual HR Measures (tactical) Headcount Turnover Rates Succession Candidates Time-To-Fill, Train, On-Board, Utilization Training Hours Cost Reductions Training Completed Grievances Client Satisfaction Surveys Performance/Potential Ratings Productivity per employee Best Practices Recognition Human Capital Objectives (strategic) Driven to Win Leaders Flexible Embracing Risk Self Developing Creative Fast Global Engaged Mission Aligned
Value Creation Increasingly Dependent on the “Talent” market Measure what you need Value Creation Strategy SMART ≠ MOTIVATED EXPERIENCED ≠ PRODUCTIVE AGGRESSIVE ≠ EFFECTIVE CHARMING ≠ CONSTRUCTIVE Product / Service Financial Talent Value Analysis in this Market is Critical
Change Brings Opportunity A revolution in the way people are valued in the workplace. Instead of treating people as units of cost, measure and maximize their strategic value to the enterprise. ‘Headcount’ gets cut. ‘Infrastructure’ gets attention! From Transactional to Strategic Human Resources to Human Infrastructure
Business Analytics Understanding how your workforce resources are allocated is what the analytics do for you. Identify top workforce drivers and allocate appropriate investments to drive company success. Align workforce performance with business strategic goals. Focus workforce practices on critical business success levers. Focus is on certifications, qualifications, competency and performance, measure not only performance but potential, maximize investments.
So what do we tell to leaders? What the workforce is capable of, What the workforce needs to evolve to, How successful are we executing, Where does $’s spent generate the best results, How should we form teams, Who, when, where, Where & How should work be performed and measured, What & How do we reward & recognize, Which employees are the future and how do we get them what they need to get there.
The Balanced Scorecard Results Customer Processes People Here is how it all comes together Individual objectives & appraisals, Aligning people with strategy, Training People Processes Measures & Analytics Behaviours Decisions & actions Execution Business Strategy Reporting Organizational Constructs using strategy to drive delivery
Business planning; Risk management; Resource allocation; Project & Programme Management
So what does it look like in the real world Navy Personnel Readiness Issue: Navy skill requirements are constantly changing with Congressional actions, unit moves, reorganizations and equipment fielding or retirement. Operational unit readiness is a function of personnel readiness but in terms of fill and fit (skills, experience/grade) Solution: Fielded forecasting tools which predict personnel readiness up to 15 years into the future at varying levels of detail (higher near term and more aggregated beyond 5 years) Metrics: gains, promotions, losses, experience levels and gaps Navy Incentives Issue: Use of incentives is a major component of personnel costs supporting personnel retention (selected skills and experience) and volunteerism for difficult to fill locations (hardship locations) Solution: Fielded analytic tools which track the use of incentives for ROI and a “reverse bid” tool which allows the Navy to post ceilings for certain assignments and the Sailors can bid down (win-win) Metrics: Retention %, Incentive Utilization, Bid levels, Cost Savings
Some more examples Navy Budget Process Issue: Navy submits a Five Year Defense Plan and Program Objective Memorandum to justify budgetary requirements. Personnel costs, direct and supporting, represent a significant portion of the overall budget. Costs are driven by both internal and external factors. Solution: Developed predictive forecasting models allowing policy analysis and resulting strength and budget requirements (planning) and execution tracking models which allow month to month analysis (expenditures to target) Metrics: Annual and monthly strength, Costs, Readiness levels US FBI Strategic Planning Issue: The FBI recognized the changing nature of crime and trends would require reorganization and realignment. Solution: Developed a workforce strategic planning model which allowed analysis to develop future scenarios (requirements), forecast the gaps between the projected existing and future requirements and solutions for closing the gaps Metrics: annual gains, promotions, losses, experience levels and gaps by scenario