1. How well do you know
your workforce?
Introduction Analyticmaturityisajourney
Talent Management can be defined as “A The use of analytic techniques can vary greatly
conscious, deliberate approach undertaken to across organizations and it usually evolves over
attract, develop and retain people with the time, as the trends become more established and
aptitude and abilities to meet current and future more widely embedded into best practice. The
organizational needs.” But effective talent journey into analytics can start with simple ad-hoc
management goes beyond merely attracting, reports to investigate specific issues that can
developing and retaining talent; it extends to influence business performance, for example the
optimizing the performance of existing and relative performance of Sales Managers in a given
potential workforce, whilst maintaining good quarter, or the staff turnover figures by
standardsofemployeesatisfaction. department.
In order to effectively manage something, it has to As organizations develop more mature
be properly understood. This is because approaches to analytics, it is common to see the
understanding is an important prerequisite of emergence of regular reports, typically used by
management. Analytics is one technique in which the Management team to make business
something complex can be comprehensively decisions. Periodic reports inevitably require
understood with clarity. It is a technique from some up-front decisions as to which data to
which important insights can be obtained for include. Therefore it is common to see reports on
continuousimprovement. headcount, staff turnover, remuneration,
performance, and other basic parameters. Whilst
these reports can provide useful insights for
business decisions, their pre-defined nature
means that there may be more risks and
opportunities that the organization will not easily
capture,atleastnotuntilthesefactorsstarttohave
a measurable impact on the business
performance.
Director of human capital consulting (South East Asia) for Deloitte Consulting
How well do you know your workforce? - By Mario Ferraro
Analytics
n. The systematic computational analysis of data or
statistics.
(Oxford Dictionary)
By Mario Ferraro

2. The more advanced organizations use analytics
techniques to test hypotheses. For example, if
clear correlations were found between employee
training and productivity, it could be possible to
test whether an increased expenditure in training
couldresultintobetterprofitmargins.
With increased levels of sophistication and
adoption, analytic techniques can be used for Thisiterativeapproachissimilartotheoneusedby
predictive modeling. Having understood how doctors, who start from the patient's statement of
various aspects of the business can affect each the symptoms and then gather all information
other, analytics can be used to understand the and data to reach a diagnosis. Doctors often
likely impact of making certain decisions. Using recommend a comprehensive range of tests in
these techniques, organizations could in theory order to understand the root causes of the
make better investment decisions regarding, for problem. Based on the insights gathered through
example, training, headcount or salary the tests, the doctors will determine a diagnosis
increments, by simulating how such decisions and prescribe an appropriate course of action.
could influence the performance of the business The condition of the patient needs continuous
andoftheemployees. monitoring for a while, to determine whether the
prescribedtherapywaseffective.
Whilst it may be tempting to think of analytics as a
one-time exercise to address specific issues, the An organization can be thought of as a system
best organizations recognize that analytics is an with several parts. The overall performance of the
on-going process that should ideally be organization will depend on the collective
embedded in the organizational culture. The individual performance of its parts or
starting point is a clear articulation of the critical departments. Analytics will show how each part
workforce issues that the organization in trying to affectstheperformanceoftheentireorganization.
tackle. For example, in knowledge-based
industries, talent attraction and retention are It is important to understand how analytics
common concerns that can significantly affect techniques are different from HR metrics. HR
shareholder value. Once the issues have been metrics are numbers or ratios which express the
articulated, all available data can be leveraged to value of a specific parameter at a given time. In a
gain deep insights into all possible factors that sense, HR metrics are like the numbers on the
could directly or indirectly affect the issue. Today, dashboard of a car, which provide an indication of
fast processing times and inexpensive data whethereverythingisoperatingnormally.
storage make it possible to store and process large
volumes of data in a very short time. The analytics Analytics,ontheotherhand,providesinsightsinto
insights will reveal useful information regarding how a variety of dynamic variables interact with
possible risks and opportunities for performance each other to produce the measurable outcome.
improvement, based on which an action plan can In the HR context, analytics can describe how
be developed. However it is important to various factors work together to affect employee
continue the cycle, to monitor the effectiveness of behavior. Hence, analytics provide a detailed view
the action plan and to make the necessary ofwhatHRmetricsonlysummarize.
adjustments,ifrequired.
Forexample, theHRmetricsfor“staffturnover”will
Theanalyticscycle
Metricsvs.Analytics
How well do you know your workforce? - By Mario Ferraro
“Analytics is an on-going process
that should ideally be
embedded in the organizational
culture.”

3. Inductive and Deductive
Applications of Analytics inTechniques
TalentManagement
There are several benefits of this kind of periodic
inductive research. For example, analytics on one
companyshowedthatitwascommutingdistance
that represented the most influencing factor on
employee satisfaction. Knowing the most
influencing factors will play a big role in decision
making. The more knowledge the organization
hasthebettertheirdecisionsare.
There are a number of approaches to performing
analytics: the most commonly used are the
There are several applications of analytics in the
deductive and inductive approaches. The
field of HR. One application is safety, looking at
deductive approach starts with making some
issues such as workplace accidents and factors
assumptions, or hypotheses, regarding
influencing them like, for example, too many
relationship between two variables. An example
night shifts.There is also research done in the field
of a hypothesis would be that increased training
of diversity and how diversity affects team
leads to better employee retention. The next step
performance. It is also important to analyze
involves gathering data related to this hypothesis
network and influence groups, how the people
and finally proving or disproving the hypothesis
around an employee affect their behavior and
basedontheanalysisofthedata.
performance. Understanding retention and
absenteeism are some of the other applicationsThe inductive approach on the other hand does
analyticsisusefulfor.not start with any specific assumptions, but rather
by just collecting data and analyzing it for
Predictive analytics can also be used to predict
correlations.This kind of approach is routinely use
and manage retention. For example, by
in specialized consulting firms like the Deloitte
performing analysis on internal and external data
Analytics Institute, which is based in Singapore
it is possible to predict which employees are at the
and delivers professional services to organizations
highest risk of leaving the organization and why.
around the world. Deloitte has performed
Based on these insights, the organization can
comprehensive analysis on talent management
make decisions to mitigate the risks, for example
by utilizing various sources of data including
sending letters of recognition, phone calls from
financial databases, telephone logs, employee
superiors,orsalaryincrements.
information as well as even lists of websites
employees visit. These internal data-sets can also In addition, predictive analysis can be used in the
be correlated with external factors, such as area of Workforce Planning to project the supply
demographic data, unemployment rates, GDP, and demand of talent for an organization.
inflationsandmanyothers. Scenarios and models are helpful here too to
anticipate challenges and make all the
appropriatedecisions.
Analytics can also help to understand the day to
day activities of the HR function, such as how they
operate, their decision making habits and service
levels. The HR function can be properly managed
andimprovedbyusinganalyticstounderstandit.
How well do you know your workforce? - By Mario Ferraro
“Knowing the most influencing
factors will play a big role in
decision making. The more
knowledge the organization has
the better their decisions are.”
Inductive
Approach
Start with a
hypothesis and
prove/disprove
Start with lots of data
and derive a theory.
Deductive
Approach

4. Conclusion
Contrary to popular belief, organizations don't HRM Enterprise is a comprehensive HRIS which
need to wait until they have complex systems and contains all modules required to systematically
a full set of data in order to start doing some manage HR functions. It’s known for its ability to
analytics; they can start small by performing centrally manage payrolls in multiple currencies
simple analysis and then later on expand their acrossmultiplelocationsandbusinessunits.Italso
analysis based on the data they continue to includes all other necessary talent management
gather. tools and frameworks both operational and
strategic which help streamline the day-to-day
As the organization recognizes the power and the function of the HR department and assist with HR
valueofanalytics,itwillonlybenaturaltocontinue planning. The modules have a mix of both tried
on the journey by gathering more data and andtestedaswellascontemporarytools.
extracting as much value as possible from it.
Analytics plays an important role in not only HRM Enterprise is module-based and designed
effective talent management but in furthering the with flexibility in mind, so you could pick and
performanceoftheentirecompanythroughit. choose modules that are relevant to your business
needs and industry. You do not have to pay for
features that you do not need. It is also fully web-
based and so can be accessed from any location
via the internet. The highly configurable nature of
the HRM Enterprise allows for almost any changes
to the system’s processes without the need for
complex and costly software code changes.
(Configurabilityratherthancustomisability)
This award winning system has evolved for 2
decades of development and now has over 650
customers in 30 countries and 18 diverse
industries. HRM enterprise is designed to be used
globally, but has also been tailored successfully for
the African region and it’s soon becoming the
preferredHRsysteminAfrica.
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AboutHRMenterpriseXV
How well do you know your workforce? - By Mario Ferraro
Mario Ferraro is the Director of human capital
consulting (South East Asia) for Deloitte Consulting,
an international HR consultancy agency. Mario has
over 15 years of experience in the field of Human
Resources and has worked in international
consulting companie like PricewaterhouseCoopers.
Healsoholdsanawardforhisdistinguishedservices
for the Worldwide Employee Relocation Council
(WERC) of which he was a member of the Board of
Directors.
The whitepaper is an extract from a Keynote speech
About
the author
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