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  1. 1. HR TECH REPORT: TALENT MANAGEMENT 35% 30% OUTLOOK Percentage of companies with Percentage of companies with 2,500 or SECTOR 2,500 or more employees that are more employees that indicate they will in the process of implementing make significant investments in analytics analytics software. software during the next three years. Source: International Association for Human Resource Information Management and Knowledge Infusion study WORKFORCE DATA MADE SIMPLE Clockwise from near right: Authoria presents workforce information in a baseball card- style format that includes employee photos, while prod- ucts from SAP and Business Objects offer “dashboards” that display key data in ways as easy to understand as a speedometer or fuel gauge. Keeping score with analytics software By Ed Frauenheim Makers of the cutting-edge talent management applications promise business insights by organizing workforce data in EASY-TO-UNDERSTAND ‘SCORECARDS’ and ‘DASHBOARDS,’ but many employers remain unclear what information they should be looking for. T O DAY ’ S cutting-edge tech- combine player photos with important of Joe Smith is his job title, performance nology for managing talent statistics, companies can view snapshots rating, the amount of time Joe has worked has much in common with of their team members that include a at the company and how long he’s been in car dashboards and baseball range of key information, such as salary his current position. cards. Makers of software to level and performance rating. This way of organizing information not help firms recruit, assess, Software firm Authoria, for example, only is easy on the eye, it eliminates much Cooper develop and retain employ- allows managers to see an organizational of the grunt work associated with trying ees are trying to present key data in ways chart on the computer screen with im- to analyze data stored in paper records, as simple to understand as a speedometer ages of their direct reports presented al- spreadsheets or Microsoft Word docu- or fuel gauge. And just as baseball cards most like baseball cards. Below the photo ments, says Jeff Cooper, senior business Oracle dash- boards visually map data such as turnover, return on human capital, employee productivity, organizational growth and headcount by region and job category. may 21, 2007 w w w . w o r k f o r c e . c o m | Workƒorce MANAGEMENT 25
  2. 2. HRTECHREPORT TA L E N T M A N A G E M E N T consultant at Authoria. In effect, workforce analysis and pres- to use during the past five years or so. entation tools like those from Authoria raise the game of hu- Still, some skepticism surrounds the analytics field. Ven- man resources managers and other company leaders, Cooper dors of analytics tools have not always provided effective says. “Now that person can focus more strategically,” he says. software or guidance to customers, experts Workforce analytics applications refer to software prod- say. It remains difficult for large companies to ucts that help a company draw conclusions from its human gather basic employee data such as head- resources data. These tools are considered particularly vital count—which makes scouring the informa- for the most strategic talent management tasks, which in- tion for trends difficult. And it’s not clear that clude recruiting the right employees, measuring their per- organizations know what information they formance, helping them develop and compensating them ef- Starkman should be looking for. fectively. To make smart decisions around hiring, promotion Jodi Starkman, a talent management specialist with con- and pay, firms ideally need to sift quickly through data such sulting firm ORC Worldwide, says diving into workforce an- as performance reviews, salary levels and even store revenue. alytics applications can just result in making a bad pro- Partly because organizations are eager to make wiser tal- cess—such as recruiting from poor sources of candidates ent management calls, there is growing interest in work- —more efficient. force analysis applications and related “dashboards” or “HR is collecting a lot of data,” Starkman says. “But peo- “scorecards.” The momentum also stems from the way such ple are still confused about what kinds of business ques- software has become both more sophisticated and simpler tions they should be answering.” specialists that focus on such tasks as recruiting, On the fringes of performance management and learning man- the HR tech market agement. Vendors that limit their wares to talent man- A COUPLE OF software strangers have come to agement software typically can’t mine data out- town. side of the applications they sell, says Farhana Cognos and Business Objects are not as famil- Alarakhiya, associate vice president of analytics iar to workforce management leaders as are such applications at Cognos. In addition, she says her HR application vendors as Oracle, SAP and Suc- company’s application is easier to use than ana- cessFactors. Cognos and Business Objects typi- lytics tools from SAP and Oracle and comes with cally are called “business intelligence” software Cognos dashboard “high-touch” service. makers, but both vendors make products de- At the start of a software implementation, signed to analyze talent-related information. And Cognos makes sure to bring together line man- like the proverbial movie strangers who spur self- agers and HR officials to ask what metrics are reflection and shake up communities, the firms most important to them. “Users are getting ex- provide greater insights compared with analysis actly what they want the first time,” she says. tools from the usual suspects in human resources SAP and Oracle both dispute the portrayal of technology, according to the companies. their analytics products as hard to use. SAP says Still, it’s not always easy to be the outsider. its business intelligence tools have advanced to Business Objects has seen just moderate growth be as simple to use as a pocket calculator. Ora- for its Workforce Analytics product, even as oth- cle argues that using a third-party analytics tool er vendors report solid progress. Business Ob- can lead to integration headaches. Business Objects dashboard jects plans to reintroduce its workforce analytics Cognos launched its workforce analytics appli- software this year, says Richard Stocks, the com- cation about a year ago, and has seen significant pany’s product marketing manager for analytics the efficiency of HR operations and show the business for it. The company says its tool is used applications. Stocks and his colleagues plan to links between workforce matters and business to track workforce data for more than 500,000 clarify that Business Objects makes software of results. employees and is used by four out of the 10 top interest to more than just techies in information In a recent study from the International Asso- HR outsourcers, including IBM. technology departments. ciation for Human Resource Information Man- Despite less-than-scintillating sales of its work- “There’s been a lack of education in the mar- agement professional group and consulting firm force analysis product, Business Objects remains ket,” Stocks says. Knowledge Infusion, 30 percent of companies bullish about the field. Stocks, an outsider to the That market is poised to invest more heavily in with 2,500 employees or more indicated they HR world, still believes he can help workforce software products that analyze workforce data, will make significant investments in analytics management professionals see the big picture experts say. Companies have become more fo- software during the next three years. more clearly, and have the time to focus on it. cused on managing their talent through the use The giants of the HR software field, Oracle “I always tell people, ‘Analytic applications of metrics. In addition, vendors have made im- and SAP, sell workforce analytics products. Also give you your job back.’ ” provements to software tools designed to study offering analytics tools are talent management —E.F. 26 Workƒorce MANAGEMENT | w w w . w o r k f o r c e . c o m may 21, 2007
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  4. 4. HRTECHREPORT TA L E N T M A N A G E M E N T Specialized talent management applications often lack the ability to compare data from different areas, which is a priority for customers. “Rather than getting into super-detail in any one type of product, they want to see how their learning management, performance management and recruiting data tie together to meet their business goals.” —Gretchen Alarcon, vice president for human capital management product strategy, Oracle FIRMS SHOWING INTEREST links for recruiters to schedule interviews, says Don Brown, A recent study from the International Association for senior vice president of human resources at Intervoice. Human Resource Information Management professional Brown has higher aspirations still. He’d like to configure group and consulting firm Knowledge Infusion suggests his SAP software to create an improved dashboard for line many companies are not doing heavy analysis of their work- managers. Already, his manager self-service portal includes force data. In the survey, which polled IHRIM members open job requisitions, employee birthdays and service an- and Knowledge Infusion customers, 52 percent of respon- niversary dates. He wants to add such information as year- dents with 2,500 employees or more cited very light to mod- to-date turnover, talent development goals and progress to- erate assessment of the impact of HR initiatives on business ward them, and performance reviews ranked by score and results through standard reports and spreadsheets. Twenty- linked to summaries. “We can justify the funding,” he says, four percent of such organizations indicated they are not “but we can’t do everything at once.” P R O D U C T C AT E G O R I E S Software makers haven’t Analyzing workforce data may be as complex as finding the most important factors in store profitability or as simple done enough to help organ- as generating a companywide breakdown of employees by izations get the right data age. Firms sometimes rely on their existing spreadsheet software to tackle the easiest of these tasks. More sophisti- in front of the right people. cated application tools, though, can cost large organizations “Different stakeholders hundreds of thousands of dollars. Analysis results can be presented in reports sent by e- need different metrics. mail or posted on a Web page. In some cases, the conclu- The vendors haven’t really sions also can be seen on computer-screen dashboards that quickly signal whether a particular figure exceeds an ac- delivered on that.” ceptable level—say, annual turnover above 10 percent. —Jim Holincheck, analyst with research firm Gartner Dashboards and scorecards, which differ slightly from dash- boards by measuring progress toward a particular goal, of- ten broadcast the status of a particular metric with a green doing this type of measurement at all. Just a quarter of com- light for “OK,” a yellow for “caution” and a red for “trouble.” panies with 2,500 employees or more had implemented Besides slicing and dicing workforce data and presenting workforce analytics software. the information back to users, analytics tools can fire off e- On the other hand, the study found growing interest in mail alerts to employees when danger levels are reached. workforce analytics. Thirty-five percent of companies with Sellers of workforce analytics products divide roughly 2,500 employees or more are in the process of implement- into three categories. The first is comprehensive business ing analytics software, making it the top category among 12 software providers such as Oracle and SAP. The second is types of HR-related applications. And, the study found, 30 talent management specialists including Taleo or Authoria. percent of companies with 2,500 employees or more indi- Then there are stand-alone analysis applications from ven- cated they will make significant investments in analytics dors such as Cognos and Infohrm. software during the next three years. Lawson Software is an example of the first group. Like One firm dipping its toe into workforce analytics applica- SAP and Oracle, Lawson makes software to automate vari- tions is Dallas-based software company Intervoice, which ous business areas including human resources, finance and employs about 800 people worldwide and whose products manufacturing. Lawson, which is based in based in St. include software for contact centers. Intervoice recently be- Paul, Minnesota, says its Lawson Business Intelligence gan using a dashboard within SAP’s E-Recruiting software. software allows companies to peer across multiple areas of Among the tools available to the Intervoice staffing team are the business to come up with useful information. a summary of job applications waiting to be processed and Cecile Alper-Leroux, Lawson’s director for human capital 28 Workƒorce MANAGEMENT | w w w . w o r k f o r c e . c o m may 21, 2007
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  6. 6. HRTECHREPORT TA L E N T M A N A G E M E N T management product strategy, cites hiring metrics as an ex- offer letter to a new hire automatically see the range of ample. She says Lawson Business Intelligence goes beyond salaries given to employees with similar jobs, says Gretchen simply measuring the time it takes to hire someone to consid- Alarcon, Oracle vice president for human capital manage- er the effectiveness of the hire—seen through ment product strategy. figures such as total cost of the employee, how Alarcon concedes that vendors specializing in talent quickly the person became productive and how management applications such as recruiting or compensa- successful they were in performance reviews. tion software may allow users to drill more deeply into the “That’s a much more complex view,” she says. information presented in reports or alert e-mails. But she Oracle also boasts of workforce analytics argues that the specialists’ products often lack the ability to Alper-Leroux software that spans the typical “silos” of infor- compare data from different areas, which is a priority for mation in a company. It sells analytics tools for both its Or- customers. “Rather than getting into super-detail in any one acle E-Business Suite and PeopleSoft Enterprise product type of product, they want to see how their learning man- lines, and is working to “embed” analytics in individual agement, performance management and recruiting data tie product modules. For example, its Oracle iRecruitment ap- together to meet their business goals,” Alarcon says. plication is set up so managers who are asked to approve an Adam Miller, chief executive of talent management soft- K I I C H I R O S AT O / A P Cautious optimism at Cardinal Health VINCE EUGENIO is on the verge of discovering a treasure trove of talent management informa- tion. But Eugenio, vice president of enterprise learning solutions for medical products and serv- ices company Cardinal Health, knows enough about HR software to realize that promised re- turns from technology can be elusive. So he’s both excited and cautious about a workforce an- alytics application that Cardinal will begin using soon as part of a new outsourcing agreement. Eugenio is eager, for example, to get rapid Cardinal Health reports on such topics as how particular training employees programs correlate to employee retention, sales growth and profitability. But rather than nents, has challenges along these lines. During ing stands out from analytics tools built into rely solely on the vendors to suggest the best the next three years, the company plans to con- learning management systems. ways to slice and dice Cardinal’s learning-related solidate nine separate learning management soft- “What I have will be exponentially better than data, Eugenio and his team are doing their own ware systems into just one or two, Eugenio says. what any learning management system can pro- homework. Eugenio declined to identify the learning man- vide,” he says. “The analytics tool in the LMS isn’t “I’ve been in this space 20 years,” Eugenio agement application or the workforce analytics dipping into the other systems.” says. “I’ve learned a lot of hard lessons.” tool being supplied by ExcellerateHRO, which an- Eugenio has been at Cardinal seven months. Cardinal is one of a growing number of organ- nounced its contract with Cardinal in April 2006. Before that, he spent several years at staffing com- izations turning to applications to help them He did say, however, that the analysis application pany Randstad, where he honed his data-digging study their data related to employee recruiting, is from one of the major vendors of “business in- skills by noticing a link between how thoroughly a performance, development and compensation. telligence” software, whose makers include Busi- manager trained and oriented new sales profes- Companies have seen evidence that closer at- ness Objects, Cognos and SAS Institute. sionals and their overall sales performance. The tention to their workforce data can help boost Cardinal’s combination of learning manage- program won Randstad an Optimas Award from the bottom line, and software to mine that in- ment software and workforce analytics will “go Workforce Management in 2006. formation and present it clearly has improved in live” beginning early next year. Its workforce an- Still, Eugenio’s software skepticism persists. recent years. alytics application is an example of a stand-alone He notes that Cardinal’s learning data won’t ini- On the other hand, hurdles to wider adoption tool, designed to draw data from other applica- tially be linked to its finance information. He of analytics tools include lingering skepticism tions holding workforce or business data. Other hopes that will occur down the road. about the products and the difficulty of piecing vendors of analytics software combine their “I can smell the steak. I can hear it sizzle,” he data together at large, complex companies. data-mining products with talent management says of the new system. “But how is it going to Cardinal, with some 40,000 employees, multi- applications or broader business management be cooked?” ple business units and operations on five conti- software. Eugenio says the product he’ll be us- —E.F. 30 Workƒorce MANAGEMENT | w w w . w o r k f o r c e . c o m may 21, 2007
  7. 7. HRTECHREPORT TA L E N T M A N A G E M E N T ware firm Cornerstone OnDemand, agrees tools. “In virtually every case, it’s much eas- which focuses on HR and talent manage- that vendors need to provide a range of ap- ier to configure, navigate and report in our ment matters. plications in order for analytics tools to re- system,” he says. Brian Kelly, vice president of sales and sult in the most useful information. But Also in the mix are companies that focus marketing at Infohrm, says his product will Miller, whose firm offers software for per- on analytics tools alone. These include gather data from a variety of sources in an formance management, succession plan- “business intelligence” software makers organization. But a key part of Infohrm’s ning, compliance management and com- Cognos and Business Objects, both of pitch is its willingness to consult with cus- pensation planning, takes issue with the which make tools for analyzing a range of tomers about how to use metrics effectively idea that the big business software players business information, including workforce in their management style. “It’s not a tech- have an edge in analytics and dashboard data. Another analysis specialist is Infohrm, nology issue at companies,” Kelly says. “It’s a change management issue.” Companies have been banging on In- fohrm’s door. The firm has seen revenue grow more than 35 percent annually over “If HR leaders don’t know what to do as a result of the metrics, then having them doesn’t matter.” —Naomi Bloom, Bloom & Wallace the past three years, and clients include such big names as Starbucks, Nokia and Time Warner. Other vendors of workforce analytics software report growing interest in their products as well. “It gets talked about a lot,” says David Ludlow, SAP’s vice president of product management for hu- man capital management applications. On the other hand, Ludlow says relative- ly few organizations have actually put ana- lytics tools and dashboards into place to glean wisdom about their talent. Among the challenges to greater use of analytics is that many companies still make decisions about things like succession planning and perform- ance management on paper or in spread- sheets, where data is hard to retrieve, he says. “You can’t have analysis unless you au- tomate these processes,” he says. Another obstacle to the adoption of workforce analysis software is that the tools aren’t always easy to use. Authoria, for ex- ample, offers clients a variety of “pre- baked” reports designed to be simple to ac- cess and comprehend. One such report, intended to aid in succession planning, plots out employees on a grid showing both performance rating and potential. But us- ing Authoria’s software to ask more com- plex questions takes sophistication, such as understanding how to construct a multi- variable search. An example of such a search would be an attempt to find, for a given job family, all 32 Workƒorce MANAGEMENT | w w w . w o r k f o r c e . c o m may 21, 2007
  8. 8. HRTECHREPORT TA L E N T M A N A G E M E N T the employees and external candidates who of insight allowed the firm to do more to to be a mainstream thing that people are meet criteria around current location, will- hold on to its store managers, Kelly says. interested in.” ingness to relocate, length of service and “They know which levers to move,” he says. In other words, it soon may be as normal performance record. Cooper says HR “su- Holincheck says interest in analytics to have a dashboard in front of you at work per users” and other champions of the tool will follow the course of companies’ now- as it is to have one in front of you while are the ones likely to do such ad-hoc dig- common adoption of recruiting, perform- driving there. wmƒ ging, which can lead to important insights. ance management, learning management “Yes, it requires some understanding to cre- and compensation management software. E d F r a u e n h e i m is a Workforce Manage- ate a complex, multi-variable search from “We’re where talent management was ment staff writer based in San Francisco. To com- scratch,” Cooper says. “And rightfully so.” three to four years ago,” he says. “It’s going ment, e-mail Vendors of analytics tools also must over- come some residual distrust, says Jim Holin- check, analyst with research firm Gartner. He says vendors haven’t always done enough to help organizations get the right data in front of the right people, whether they are the HR director, CFO or chief ex- ecutive. “Different stakeholders need differ- ent metrics,” Holincheck says. “The vendors haven’t really delivered on that.” Along these lines, Lawson is working on specific role-based dashboards, such as ones for compensation analysts or recruiting managers. But the company’s Alper-Leroux A RECRUITING SOLUTION says there is a limit to the effectiveness of “canned” reports and dashboards. She says Lawson delivers about 275 preconfigured THAT EMBRACES DIVERSITY. reports, but the nuances of every business (Not to mention some pretty sweet candidates.) mean clients almost invariably want to build their own metrics. “More than 50 percent of our customers use 25 or fewer of those re- ports out of the box,” she says. Some analysts, though, question the wisdom of HR departments in choosing how to analyze their talent management data. “If HR leaders don’t know what to do This moment brought to you by a better recruiting solution. as a result of the metrics, then having them doesn’t matter,” says Naomi Bloom, manag- At, we believe companies who embrace diversity get their ing partner at Bloom & Wallace, a consult- just desserts — in the form of unique recruiting solutions and qualified diverse ing firm in Fort Myers, Florida. “The miss- ing piece is the business savvy.” candidates. Through our growing list of 85+ strategic diversity partner sites, diversity branding packages, exclusive partnerships with MSN and AOL, and E A R LY R E S U LT S diversity pavilions at CareerFairs, we provide access to six Infohrm’s Kelly says clients thus far have million ethnically diverse candidates monthly. Also, if you’re planning to attend focused on very basic data chores. “You’d be amazed how many companies struggle to SHRM 2007 in Las Vegas, stop by Booth #2759 to see our presentation on get an accurate headcount figure,” he says. diversity. Learn how our recruiting specialists can help your company achieve There was a flurry of activity around a quicker, easier and more inclusive hiring process. You’ll find out firsthand why workforce analytics about five years ago, followed by a lull we say, “Experience Better.” Post your job today by calling 1-877-Fill-A-Job or and now growing visit CEOs are taking a bigger attention to the role in talent management: topic, Kelly says. He expects that attention to continue, in part because case studies of early adopters are persuasive. In one example, a large retail client of Infohrm analyzed its data to determine that Qualified Talent Pool Most Extensive Reach Value Delivered the greatest factor in store revenue and profitability was manager tenure. That sort may 21, 2007 w w w . w o r k f o r c e . c o m | Workƒorce MANAGEMENT 33