The Insider's Guide to Workforce Analytics

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Get your Insider’s Guide to Workforce Analytics. Learn the definitions of key terms, see examples of metrics and analytics, and discover how to measure your company’s workforce analytics maturity. Plus, learn about common approaches to workforce analytics and hear case studies of analytics in action.

Published in: Recruiting & HR

The Insider's Guide to Workforce Analytics

  1. 1. Page 1visier l analytic applications for peopleVisier l analytic applications for people INSIDER’S GUIDE TO WORKFORCE ANALYTICS Dave Weisbeck, CSO, Visier Wednesday, March 5th, 3pm ET / 12pm PT
  2. 2. Page 2visier l analytic applications for people  Founded analytic industry veterans including former Business Objects CEO, John Schwarz  Won both HR Executives Top HR Product, and named Awesome New Technology at HR Technology conference  The only complete cloud-based workforce analytics and planning solution that integrates your data, answers best-practice questions and has you productive in 4-8 weeks Smart. Intuitive. Complete. Workforce Analytics & Planning.
  3. 3. Page 3visier l analytic applications for people TODAY’S AGENDA 1. A framework : key terms and definitions 2. Examples of metrics and analytics 3. How to measure “workforce analytics maturity” 4. Common approaches to workforce analytics 5. Case study examples of analytics in action
  4. 4. Page 4visier l analytic applications for people POLL QUESTION - WHERE ARE YOU TODAY? Over the next 12 months, your organization is: 1. Looking at workforce analytics for the first time (just starting) 2. Researching workforce analytics approaches (learning more) 3. Evaluating workforce analytic solutions (considering options) 4. Expanding existing workforce analytics (changing approaches) 5. Implementing a new workforce analytics solution (overhauling)
  5. 5. Page 5visier l analytic applications for peopleVisier l analytic applications for people KEY TERMS
  6. 6. Page 6visier l analytic applications for people DEFINITIONS METRIC ANALYTICS A system of measurement that seeks to quantify performance. The systematic computational analysis of data or statistics.
  7. 7. Page 7visier l analytic applications for people THE TACTICS Data Discovery – data navigation and guided exploration that allows for exploring data to find answers to questions Monitoring – to provide an at-a-glance way to see a summarized view of multiple metrics Publishing – formatted content regularly created for and consumed by stakeholders TACTIC Report Query & Analysis Dashboard Metric Measuring – A of measurement that seeks to quantify performance PURPOSE
  8. 8. Page 8visier l analytic applications for people TACTICS, STRATEGIES AND GOALS We create and use: • Reports • Dashboards • Metrics To enable better decisions about the workforce So that, we can improve business outcomes TACTIC STRATEGY GOAL A N A L Y T I C S
  9. 9. Page 9visier l analytic applications for people MOVING BEYOND TACTICS TACTICS  Measure single data points  Provide information - what  Guide operations  State past and present  Tabular outputs of counts and rates ANALYTICS  Connect multiple data points  Provide insights - why  Drive strategy  State past, present, and predict the future  Visual outputs of patterns and trends
  10. 10. Page 10visier l analytic applications for peopleVisier l analytic applications for people EXAMPLES OF ANALYTICS
  11. 11. Page 11visier l analytic applications for people RECRUITING EFFECTIVENESS “Recruitment is the HR function that has the most positive impact on revenue creation and profitability…” Boston Consulting Group From Capability to Profitability July 2012
  12. 12. Page 12visier l analytic applications for people COMMON RECRUITING METRICS Common Metrics  Time to Fill  Open Requisitions  Cost to Hire  Quota Attainment Shortcomings  Do not answer strategic questions about quality and value  Do not provide insight into hiring connections to productivity (revenue creation and profitability)
  13. 13. Page 13visier l analytic applications for people BEST PRACTICE ANALYTICS
  14. 14. Page 14visier l analytic applications for people
  15. 15. Page 15visier l analytic applications for people TALENT RETENTION “Voluntary Resignations are at a 5-year high.” Bureau of Labor Statistics Job Openings and Labor Turnover Survey October 2013
  16. 16. Page 16visier l analytic applications for people COMMON TALENT RETENTION METRICS Common Metrics  Turnover  Turnover and…  Turnover Shortcomings  Does not provide insight into why resignations are occurring  Does not allow for meaningful preventative action  Not all turnover is bad!
  17. 17. Page 17visier l analytic applications for people CONNECTING TO BUSINESS THROUGH COSTSCOST($) TURNOVER RATE Cost of Turnover (replacement) Cost of Retention Financial Benefit of Replacing Financial Benefit of Retaining OptimalTurnover
  18. 18. Page 18visier l analytic applications for people BEST PRACTICE ANALYTICS Analytic Value Turnover segmentation 1. Break turnover into segments of involuntary, voluntary, resignations and retirements, but also segment employee base to understand what is regrettable turnover. Cost of Turnover 2. Determine the costs associated with turnover so the organization can determine the appropriate level of turnover, and properly fund programs to reduce (or increase) turnover. Predicting the risk of exit 3. Identify employees at risk of leaving, based on analysis of key characteristics of past resignations, and take action to prevent top talent from leaving before they are out the door Resignation drivers 4. Determine what factors increase and decrease resignations, more effectively targeting and fine tuning retention strategies Resignation correlations 5. Correlate resignation with factors such as compa-ratio, promotion wait time, pay increases, training opportunities, and so forth, to make better and more cost effective decisions around changes to pay, benefits, and employee development
  19. 19. Page 19visier l analytic applications for people TOTAL COST OF WORKFORCE “Total workforce costs average nearly 70% of a company’s operating expenses.” Society for Human Resources Management
  20. 20. Page 20visier l analytic applications for people COMMON COMPENSATION METRICS Shortcomings  Do not support strategic decisions about compensation  Do not identify areas for optimization Common Metrics  Salaries  Total Direct Compensation  Market Compensation Ratio  Compa Ratio
  21. 21. Page 21visier l analytic applications for people WHERE TO START? Direct Compensation Indirect Compensation Deferred Compensation Contingent Labor Costs Create a Cost Hierarchy: Total Cost of Workforce (TCoW) o Total Salaries o Total Benefits  Direct Compensation  Contingent Labor Costs Build from the bottom (right to left on this diagram) Total Cost of Workforce (TCoW)
  22. 22. Page 22visier l analytic applications for people BEST PRACTICE ANALYTICS Total Cost of Workforce 1. Understand the true cost of the workforce which allows any changes to the workforce in support of the business strategy to be measured. Provides a basis for comparing workforce costs to the competition. Workforce Cost Segmentation 2. Identify the direct, indirect, contingent, benefits, leave, equity, etc. costs associated with the workforce so that the various cost impacts can be compared to determine where to focus to reduce costs, invest to attract talent, etc. Employment movement impacts on compensation 3. Understand how entries to and exits from an organization impact the total compensation expenses
  23. 23. Page 23visier l analytic applications for people BUILD COSTS INTO YOUR PLANS
  24. 24. Page 24visier l analytic applications for people EMPLOYEE MOVEMENT  Structure is the organizational hierarchy, distribution of work, and business units  Network is the relationships and connections between people within the organization  No matter how correct your structure, if the network is missing your organization will not perform at its best Structure Network Organization
  25. 25. Page 25visier l analytic applications for people COMMON MOVEMENT METRICS Common Metrics  Headcount and/or FTE  Turnover  Internal Moves  External Hires Shortcomings  Do not provide insight into impact of employee movement  Do not correlate movement to other factors
  26. 26. Page 26visier l analytic applications for people BEST PRACTICE ANALYTICS Analytic Value Movement in and out of organizational units 1. Ensure the business units that make the most difference to your business are increasing in talent quality, and not experiencing “brain drain” Build versus buy 2. Track promotions, lateral moves, and the relative performance of individuals to achieve better results at a lower overall workforce cost – internal candidates often perform better more quickly and stay longer than “stars” who are parachuted in from outside Leadership and succession modeling 3. Tracking employee movement, promotions, and key skills/experience provides insight into the organizational pathways that have developed your top talent, and allow you to identify other likely succession candidates – research by Jac Fitz-Enz found a direct correlation between better succession management and revenue
  27. 27. Page 27visier l analytic applications for people
  28. 28. Page 28visier l analytic applications for peopleVisier l analytic applications for people MEASURING “WORKFORCE ANALYTICS MATURITY”
  29. 29. Page 29visier l analytic applications for people BERSIN’S TALENT ANALYTICS MATURITY MODEL Level 1: Reactive – Operational Reporting Ad hoc, reactionary Level 2: Proactive – Advanced Reporting Routine, benchmarking, dashboards Level 3: Strategic Analytics Segmentation, analysis, people models Level 4: Predictive Analytics Predictive models, scenario planning Source: Bersin by Deloitte 2013 56% 4% 10% 30%
  30. 30. Page 30visier l analytic applications for people A MAP TO WORKFORCE ANALYTICS MATURITY Self-serve Analysis PredictiveDashboardsReporting Level 1: Reactive Level 2: Standardized Level 3: Focused Level 4: Strategic Reach in Data and Users Assess Maturity Model Status Analytic Capabilities Core HRIS Data Performance Data Compensation All Talent Data Business Data Recruiting Executives HR Department Business Leaders All People LeadersAnalysts Business Impact
  31. 31. Page 31visier l analytic applications for people WORKFORCE ANALYTICS MASTER PROFILE Reactive Standardized Focused Strategic Path to maturity OperationaltoStrategic “Get it done” “Be Consistent” “Aligned with the business” “Drive the business”
  32. 32. Page 32visier l analytic applications for people Limited linkage between various systems Multi-system integration MATURITY MODEL • One off reports • Highly manual • Spreadsheet- based • Predictive analytics align to specific business strategy • Single data source • Consistent scheduled reports • Business- specific dashboards and visuals • On-demand answers Get it done. Drive the business. Be consistent. Align with the business. Analytic Capabilities Focus Single System Big Data Analysts All People Leaders HR & Executive Leaders Business & HR Leaders Reach in Data Reach in Users Reactive StrategicStandardized FocusedLevel
  33. 33. Page 33visier l analytic applications for peopleVisier l analytic applications for people COMMON APPROACHES
  34. 34. Page 34visier l analytic applications for people ANALYTICS LANDSCAPEHRDomainSpecificity Analytics Capabilities HR CORE APPLICATIONS • Operational / transactional metrics and reports • Standardized • Self-service options • Application-specific data SPREADSHEET SOLUTION • Manually created • Non-standardized • Prone to error • No self-service BUSINESS INTELLIGENCE SOLUTION • Expensive and lengthy to implement and update • Requires IT expertise • Requires data warehouse • Designed for technical user, rather than business user WORKFORCE ANALYTICS • Purpose-built for workforce analytics • Short implementation • Possibly skip data warehouse • Designed for HR and the business
  35. 35. Page 35visier l analytic applications for people ANALYTICS LANDSCAPEHRDomainSpecificity Analytics Capabilities HR CORE APPLICATIONS • Operational / transactional metrics and reports • Standardized • Self-service options • Application-specific data SPREADSHEET SOLUTION • Manually created • Non-standardized • Prone to error • No self-service BUSINESS INTELLIGENCE SOLUTION • Expensive and lengthy to implement and update • Requires IT expertise • Requires data warehouse • Designed for technical user, rather than business user WORKFORCE ANALYTICS • Purpose-built for workforce analytics • Short implementation • Possibly skip data warehouse • Designed for HR and the business BAD REACTIVE
  36. 36. Page 36visier l analytic applications for people Buy & Deploy ETL Tools Buy & Deploy Warehouse Build Warehouse 12-36 months Buy & Deploy BI Platform interview users map data to BI model interview users build reports & dashboards I need a new report, and new questions! And how do I plan? deliver analytics START HERE END HERE 18-40 months HIGH FAILURE RATES OF BI: “… More Than 50 Percent of Data Warehouse Projects Will Have Limited Acceptance or Will Be Failures” “Between 70% to 80% of corporate business intelligence projects fail…” Gartner HIGH COST OF BI PROJECTS: “… survey put average price for a data warehouse at $2.3M and average payback at 2.3 years.” “…time to implement [a data warehouse] ranges from 12 to 36 months” IDC Services for Analytic Content BUSINESS INTELLIGENCE (BI) CHALLENGE
  37. 37. Page 37visier l analytic applications for peopleVisier l analytic applications for people CASE STUDIES: ANALYTICS IN ACTION
  38. 38. Page 38visier l analytic applications for people CONAGRA FOODS Challenges  Numerous, manually-created reports  Complex HRIS with limited analytics capabilities  Home-grown analytics solution that could not keep up with demand  Changing workforce data that was difficult to access Solution  Visier Workforce Analytics Results  30 day implementation  Delivers self-service analytics, with over 300 workforce answers, out of the box  Fact-based decision making and initiatives: – Identified attrition most at risk for people with a specific age, ethnicity, gender, and tenure profile – Predicted turnover was at risk of increasing for successor- level positions Download at www.visier.com
  39. 39. Page 39visier l analytic applications for people INFORMATICA Challenges  Workforce data in a limited, tabular format  Difficult to produce workforce analytics, requiring IT time and expense  Operational reporting from Workday (vs. strategic) Solution  Visier Workforce Analytics Results  Self-service analytics for the whole business  Removal of dependency on IT  Actionable insights, based on predictive analytics Download at www.visier.com
  40. 40. Page 40visier l analytic applications for people Plus additional reports and on- demand videos on:  Case Studies  Whitepapers  From HR Metrics to Analytics  Big Data for HR  And others… Download these reports, on-demand webinars and more here: http://www.visier.com/resources/ Where to learn more… Five Steps to Getting Started with Workforce Analytics Find out how you can simplify and accelerate your journey from HR metrics to workforce analytics. Watch the Recorded Webinars and Hear from ConAgra Foods and Informatica Directly Mark Berry, VP People Insights ConAgra Foods Kumud Kokal, Sr. Director HR Technology and Operations Informatica
  41. 41. Page 41visier l analytic applications for peopleVisier l analytic applications for people Q&A visier l analytic applications for people

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