The document provides an overview of a webinar focused on measuring talent management effectiveness using integrated analytics, featuring speaker Kim Lennon and moderator Kellye Whitney. It covers key challenges HR faces, the significance of talent analytics in business performance, and various levels of HR maturity from compliance-driven to business-integrated HR. Additionally, it discusses the need for integrated talent management systems and the role of key performance indicators (KPIs) in measuring organizational success.

1. Measuring Talent Management Effectiveness With
Integrated Analytics
You can listen to today’s webinar using your computer’s
speakers or you may dial into the teleconference.
If you would like to join the teleconference,
please dial 1.408.600.3600 and enter access code: 491 777 946 #.
You will be on hold until the seminar begins.
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2. Measuring Talent Management Effectiveness With
Integrated Analytics
Speaker: Kim Lennon
Senior Product Manager
SumTotal Systems
Moderator: Kellye Whitney
Managing Editor
Talent Management magazine
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3. Tools You Can Use
• Q&A
– Click on the Q&A icon
on your floating toolbar
in the bottom right
corner.
– Type in your question in
the space at the
bottom.
– Click on “Send.”
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4. Tools You Can Use
• Polling
– Polling question will
appear in the
“Polling” panel.
– Select your
response and click
on “Submit.”
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5. Frequently Asked Questions
1. Will I receive a copy of the slides after the webinar?
YES
2. Will I receive a copy of the recording after the webinar?
YES
Please allow up to 2 business days to receive these materials.
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6. Measuring Talent Management Effectiveness With
Integrated Analytics
Kellye Whitney
Managing Editor
Talent Management magazine
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7. Measuring Talent Management Effectiveness With
Integrated Analytics
Kim Lennon
Senior Product Manager
SumTotal Systems
#TMwebinar

8. Measuring Talent
Management Effectiveness
With Integrated Analytics
Presented by:
■ Kim Lennon – Sr. Product Manager

9. Agenda
■ Challenges Facing HR
■ All About the Numbers
■ Improvements to Top and Bottom Line
■ Tools – What’s Available Today
■ SumTotal
■ Discussion
Page 8 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

10. Human Resources Maturity Model
Level 4: Business-Integrated HR
HR strategy part of the business strategy.
HR helps to drive business decisions through people, data and insights.
Business and HR systems integrated and advanced.
Level 3: Strategic HR Department
HR aligned with business strategy.
HR functions supporting business needs.
Initiatives split between HR process improvements and talent needs.
Level 2: Fundamental HR Services
HR strategy partially or fully defined. Siloed HR functions.
Some standardized processes and policies; core services managed well.
Some automated talent systems, but little integration of data.
Level 1: Compliance-Driven HR Services
No HR strategy.
Personnel function, mostly separate from business and talent needs.
Line managers perform HR activities as they see best.
Bersin & Associates, 2010
Page 9 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

11. HR Maturity Has Direct Impact on Business
HR’s Relationship to
Business Strategy
40%
30%
20%
10%
0%
HR is a full partner in
developing and
implementing the business
strategy
Low Market Performers
High Market Performers
Bersin & Associates Institute for Corporate Productivity
Page 10 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

12. Why Talent Analytics?
Analyst research shows direct correlation to business performance
Bersin 2011 HR Factbook
shows organizations that
have reached maturity
(Level 4) by having
business-integrated HR
functions rather than
compliance drive (Level 1)
HR show significantly higher
performance in the following
metrics
Page 11 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

13. Poll Question # 1: What is your level of maturity?
1. Compliance-Driven HR Services – little to no strategy identified, departments
are still in charge of HR activities
2. Fundamental HR Services – definition of strategy began, still siloed HR
functions, some automated talent systems, but little data integration
3. Strategic HR Department – HR aligned with business strategy with HR support
business needs with initiatives split between employees and process
improvements
4. Business – Integrated HR – HR strategy is part of business strategy and HR
influencing business decisions through integrated and advanced systems
Page 12 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

14. Why Integrate Talent Management?
Integrated business processes enable HR transformation
Talent Learning Workforce Payroll
Management Management Management Management
 Learning development suggestions and
assignments based on competency gaps Need Integrated Strategic
 Demand driven talent succession, hiring, and HCM Business Processes
development plans based on gaps
Visibility of critical talent issues, gaps
and development plans Need Integrated Visibility and
Align workforce strategy with Analytics Across HCM processes
business objectives HR
Transformation
Employees Contingen Extended
t Enterprise Need Integrated Talent management
across Organizational Models
Integrated processes are mission
critical for certain industries
Page 13 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

15. Why Integrate Talent Management?
Typical pain points without integrated Talent Management
• Alignment and agility to respond to strategic business
objectives
CEO • Do we have the right talent and systems to support the
growth?
• How can I get my team to meet it’s numbers?
VP of Sales • What are my people risks and mitigation plans?
• Lack of visibility into how learning is impacting talent and
CLO business
• Meet the needs of new multifaceted global organization
• Need control to align my teams schedules to spend and
demand?
VP of Consulting • How do I get schedule based on competencies and
certifications ?
• Need global view of talent and develop and recruit for talent
Head of HR gaps?
• Self-service system for business to empower the organization
Page 14 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

16. Business Drivers, How Will They Measure
Success?
■ Improve / automate manual processes
■ Gaps within business visibility (compensation budget)
■ Improve data accuracy and consistency
■ Compliance for training
■ Provide visibility to feeder populations for executives through
senior management around the org
■ Provide good reporting (standard and ad hoc) for management to
“see” into these feeder groups
■ Provide flexible reporting structures since they have a globally
diverse, “non-flat” organization
Page 15 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

17. Business Problem
■ Difficult to timely enforce
Problem adherence of compliance
across divisions
Cannot Get Integrated Data for HCM
■ Lack of global view of talent
■ Lack of business alignment
GOAL OPERATIONAL ■ Low predictability in
SETTING PLANNING
MONITOR
performance
RESULTS
■ Inconsistency in business
ANALYZE
MODELING decisions
PERFORMANCE
Manual & ■ Inability to quickly pinpoint
Inconsistent leading and lagging parts of the
HRMS Succession
business
■ Time wasted gathering
Recruiting LMS information – cycle time to pull
data together
■ Low data quality of data and
Perf. Comp. gathered results
Page 16 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

18. Agenda
■ Challenges Facing HR
■ All About the Numbers
■ Improvements to Top and Bottom Line
■ Tools – What’s Available Today
■ SumTotal
■ Discussion
Page 17 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

19. How to Transform Your HR?
Source – Adapted from Bersin & Associates 2010
Page 18 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

20. Why Measure Performance?
Control &
Monitor
People
Report
Externally &
Demonstrate
Compliance
Learn &
Improve
Page 19 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

21. KPI Checklist
1. Which strategic objective is this indicator relating to?
2. What question do you want to have an answer to? What are
your information needs?
3. Who is asking this question? Who is the information customer?
4. What will they do with the information? Why are they asking?
■ Additional considerations:
■ What is the data collection method?
■ What is the source of the data?
■ What is the formula / scale / assessment method?
■ How often, when and for how long do you collect the data?
■ Who collects the data?
■ What is the target or performance threshold(s)?
■ What are the costs for collecting the data? Justified?
Page 20 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

22. Workforce Measurement Strategy
■ Employee Engagement
■ Recruiting
■ Retention
■ Overall HR Costs
■ Manager Satisfaction
■ Compensation and Benefits
■ Employee Relations
■ Training and Development
Page 21 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

23. Key Performance Indicators
$ Cost of Turnover
$ Cost of Benefits
$ Cost of Employee Training
% Employee Satisfaction
% Employee Motivation
% Employee Demographics
# Lost Time
% Absenteeism
Page 22 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

24. Key Performance Indicators
% Turnover
% Involuntary Turnover
% Voluntary Turnover
# Hiring Cycle
# Average Length of Employment
Page 23 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

25. HR Questions Answered Through KPIs
Is time-to-fill positions impacting company
performance?
• % New hire retention
• % Vacancies filled internally
• # Average open time of positions
Do we have sufficient labor to meet next
quarter’s demand?
• % Average employee tenure
• % Talent retention
• # Bench strength penetration
Does compensation policies for top
performers impact retention?
• % High performing employees
• % Turnover
• % Total compensation tied to performance
Page 24 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

26. Agenda
■ Challenges Facing HR
■ All About the Numbers
■ Improvements to Top and Bottom Line
■ Tools – What’s Available Today
■ SumTotal
■ Discussion
Page 25 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

27. How do you quantify ROI?
Typical “Soft” Measures, what research shows…
■ "A mere 7% of employees today fully understand their company's business
strategies and what's expected of them in order to help achieve company
goals."
Robert S. Kaplan and David P. Norton, "The Strategy-Focused Organization," Harvard Business School Press, 2001
■ “The performance differential between top and average performers is as
high as 10:1.
Jack Welch, Former CEO, GE and Jerry Yang, Former Chairman of Yahoo
Corporate Executive Board Research shows the ratio to be 12:1 for “superstars”
■ “Organizations with superior human capital practices not only are correlated
with financial returns, but are a leading indicator of increased shareholder
value”
Watson Wyatt’s Hyman Capital Index Research Report, 2004
■ “Cost of replacing an employee ranges from 25% - 200% of annual salary”
Keeping the People Who Keep You In Business, American Management Association, 2000
Page 26 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

28. “Soft” ROI Measures
Employer of Choice = Best Employees
■ Compensation isn’t as important as career advancement and
working for an “employer of choice”
Gallup Research, 2011- Employee Engagement Overview Brochure
Page 27 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

29. “Soft” ROI Measures
Engaged Employees = EPS Growth
■ High employee engagement translates to improvements across
the business
"Companies that increase
employee engagement see
improvement in operating
margins.“
Towers Perrin, New Realities
in Today's Workforce
Gallup Research, 2011- Employee Engagement Overview Brochure
Page 28 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

30. How do you quantify ROI?
Sample Calculations
■ Human Capital Return on Investment (HCROI) – relation of human
capital investments to the profitability of the organization (The ROI of
Human Capital, Jac Fitz-enz, 2000)
■ HCROI = (Revenue – Pay and Benefits)/(Pay and Benefits)
Page 29 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

31. How do you quantify ROI?
Typical factors to consider related to IT Systems expenses:
■ Fewer systems, fewer data centers, less infrastructure
■ Lowered helpdesk support cost from fewer tickets and fewer systems to managed
■ Lower administrator cost of administering multiple systems
■ Cost of data not aligned between systems
Assumptions
Annual IT FTE Fully-Loaded Cost $ 75,000
Existing Systems Consolidated System
System 1 IT Expense Cost Notes Cost Notes
Direct IT Expense $ 125,000 $ 150,000
System administration cost $ 75,000 1 FTE $ 75,000 1 FTE
Typically calculate based on cost per
incident or dedicated support
Help Desk Cost $ 37,500 heads. In this case, using 1/2 FTE $ 56,250 3/4 FTE
System 2 IT Expense
Direct IT Expense $ 175,000 $ -
System administration cost $ 37,500 1/2 FTE $ -
Typically calculate based on cost per
incident or dedicated support
Help Desk Cost $ 18,750 heads. In this case, using 1/4 FTE $ -
Integration Cost (cost of keeping data integrations in sync between)
Non-TM systems (HRIS, etc.) $ 11,538 2 weeks per quarter $ 5,769 1 week per quarter
Analytics data in sync between applications $ 5,769 1 week per quarter No cost
Total $ 486,058 $ 287,019
Yearly Savings $ 199,038
Notes
You may have more existing systems and more consolidated systems but hopefully you are moving to fewer systems!
Page 30 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

32. How do you quantify ROI?
Performance Management
Typical factors to consider related to
Performance Management:
■ HR Productivity
■ Employee/Manager Productivity
■ Improved Organizational Effectiveness
Existing Systems Consolidated System
HR Productivity Cost Notes Cost Notes
Performance Management Administration $ 13,846.15 2 people 20 hours per month $ 2,076.92 1 person 3 hours per month
(2) review sessions per year with
Roundtable/Ratings Calibration Support $ 6,442 100 hours time per session $ 1,442 25 hours per review session
Employee and Manager Productivity
2 hours per manager and 1 hour per 1.5 hours per manager and .75 hour
Time spent writing performance reviews $ 399,038 employee $ 299,279 per employee
.05% improvement in overall $570M
Optimization of compensation budget $ (335,000) comp budget
30 mins per goal (5 goals per 20 minutes per goal (5 goals per
Time spent creating/aligning goals $ 161,058 employee) $ 96,635 employee)
Improve organizational effectiveness
Increased revenues based on goal alignment $ (100,000) .01% increase in productivity
Decreased cost based on goal alignment $ (70,000) .01% decrease in cost
.5% increase in productivity per
Improved productivity based on global performance employee. 50% contribution margin,
management $ 250,000 10% attributable to TM integration
Lawsuit avoidance (cost per case) $ 500,000 5 cases per year @100k $ 400,000 5 cases per year @80k
HR Time per case $ 11,538 80 hours per case $ 4,615 32 hours per case
Total $ 1,091,923 $ 549,048
Yearly Savings $ 542,875
Page 31 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

33. How do you quantify ROI?
Performance Management Systems Integration
Category Existing Consolidated
System System
IT Expenses 486,058 287,019
HR Admin Costs 20,288 3,519
Employee/Manager Costs 560,096 60,913
Org Productivity Gains - (420,000)
Wrongful Termination Lawsuit $511,538 $404,615
■ Annual Savings = $1.1M
■ If the new system investment is $500k/yr, that results
in a 5.3 month ROI
Page 32 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

34. How do you quantify ROI?
Other Modules
■ Compensation
■ Comp Team Productivity
■ Time developing/deploying comp policies
■ Less time spent planning and approving comp recommendations
■ Reduce compensation budget overspending
■ Reduce time required to develop merit plans
■ Increase results by retaining top talent
■ Attract top talent due to compensation plans
■ Succession Planning
■ Succession Planning Team Productivity
■ Reduce Recruiting Costs
■ Reduce manager time spent on annual assessments
■ Reduce time create management reports
■ Reduce risk of business gaps due to lack of qualified personnel
■ Improve speed/success of entering new markets
■ Proactively develop plans to retain top performers
Page 33 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

35. Poll Question #2: Which area of ROI is most
important to your organization when evaluating
Talent Management?
A. Efficiency gains – savings in time to execute HR processes across the company
B. Direct cost avoidance – not having to pay maintenance, hardware or headcount
related to multiple systems
C. Productivity gains – More productive employees /organization due to better
alignment / execution of business objectives
D. Talent Acquisition – Becoming an employer of choice to attract the best
candidates
E. Reduced turnover – better employee morale driving reduced turnover, especially
among high performers in org.
Page 34 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

36. Agenda
■ Challenges Facing HR
■ All About the Numbers
■ Improvements to Top and Bottom Line
■ Tools – What’s Available Today
■ About SumTotal
■ Discussion
Page 35 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

37. Levels of Analysis Required
Visibility Analysis Strategy Excellence
• Pre-built reports • Dashboards • Target and • Management
• Self service & • Key benchmarking and operational
Configurable Ad- performance • Top & bottom excellence
hoc reporting indicators performers • Actionable
• Guided (prebuilt & • Proactive intelligence
Navigation adhoc) strategy and • Continuous
• Alerts • Trend Analysis planning Improvement
Page 36 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

38. Intelligence Through Analytics
Now and Past
Competitive Advantages
Standard Drill Down Statistical Predictive
Reports (Through) Analysis Modeling
Ad Hoc Alerts Forecasting Prescriptive
Reports Modeling
Future
Degree of Intelligence
Page 37 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

39. Don’t Do All the Heavy Lifting Yourself
■ Web based / desktop based
■ Mobile (phone / tablet)
■ Export formats
■ Office Integration
■ Dashboard and scorecards
■ Alerts and subscription delivery
■ External data imports
■ Database Versions
■ Rich design environment (WYSIWYG)
■ Drill-down & drill-through
■ Actionable Intelligence
Page 38 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

40. Analytics Tools of the Trade
■ External applications
■ Spreadmarts - heavily siloed Microsoft Excel workbooks
■ Business Intelligence vendors
■ Hardware / Software / Model
■ Company business intelligence platform (ERP Analytics)
■ Data warehouse supporting business areas – such as finance
■ Embedded reporting applications (HCM Analytics)
■ Existing reporting platform in your Talent Management or Learning
Management Platform
Page 39 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

41. Strategic Workforce Analytics
■ Most comprehensive Strategic HCM-Talent
Data warehouse
■ 200+ HCM interlinked business objects
Talent/ Role Alerts across learning, performance, succession,
Custom Based & compensation hiring and career development
Dashboards
Portal Actions ■ Rationalized data and security across these
dimensions and processes
■ Pre-built & Ad-hoc key performance
Pre Built Interactive & indicators for most industry needs
Key Performance Ad-hoc
Indicators (KPIs) Reporting
■ Pre-built role based dashboards and 50+
KPIs most critical to companies
■ Flexible and quick ad-hoc KPIs and reports to
enable dynamic analysis
Integrated Strategic HCM - Talent Data Warehouse
■ Strategic workforce analysis integrated with
external business data
Learning Performance Succession ■ Measure the impact of strategic HCM
processes based on impact to any business
drivers and data like financial, sales,
Career
Hiring Compensation customer satisfaction
Development
■ Easy to add any external data source and
create integrated reports
■ Actionable Intelligence for execution
excellence
■ Drill down into the detail transactional
information from any analysis
3rd Party systems - SAP,
Oracle, PeopleSoft
Legacy & Custom External Flat Files ■ Drive closed loop execution and continuous
Data Warehouse Business Data (CSV, XLSX)
improvement with integration transactional
actions from reports
Page 40 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

42. You can't manage what you
don't measure!
Page 41 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

43. Poll Question # 3: When do you think your
organization will deploy actionable analytics?
A. Already using analytics to make a difference
B. Within next six months
C. From six to twelve months
D. Not on the radar – but should be…
Page 42 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

44. Agenda
■ Challenges Facing HR
■ All About the Numbers
■ Improvements to Top and Bottom Line
■ Tools – What’s Available Today
■ About SumTotal
■ Discussion
Page 43 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

45. SumTotal Making HR More Strategic
Company and Business Executive
Right talent strategies to meet my
business objectives
Enable actionable insight and align
Global visibility of Talent
workforce strategy with company
Pool and Gaps
objectives
Employee or Contractor
Driving Engagement and
Retention
HR Executive/Manager
Making HR more
strategic
Scale to the needs of global
Enforce compliance across
growing organization
employees, partners, and contractors
Information Technology
Low TCO; Scalable for global
diverse organization
Page 44 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

46. About SumTotal
Worldwide Leader in Strategic Human Capital Management Solutions
SumTotal
Worldwide Leader
in Strategic HCM
Market Share (users)
3,500+
Customers
Over 43+ Million
End-Users
Leader in SMB,
Mid-Market &
Enterprise
Solutions
Global Scalability
Page 45 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

47. Agenda
■ Challenges Facing HR
■ All About the Numbers
■ Improvements to Top and Bottom Line
■ Tools – What’s Available Today
■ About SumTotal
■ Discussion
Page 46 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

48. It’s your turn! Ask our expert…
Kim Lennon
klennon@sumtotalsystems.com
Page 47 - April 9, 2012 – PROPRIETARY AND CONFIDENTIAL

49. Join Our Next TM Webinar
The Evolution of Reference-Checking Into a
Strategic Hiring Solution
Tuesday, April 17, 2012
•
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