The document discusses how HR professionals need to move beyond basic metrics and adopt workforce analytics to gain deeper insights into challenges like talent retention, performance management, and total rewards. It provides examples of analytics that can provide strategic value in areas like recruiting effectiveness, performance, talent retention, employee movement, and total rewards. These analytics uncover important connections in organizational data to help HR leaders make better decisions that drive business success.

1. The Datafication of HR: Graduating from
HR Metrics to Workforce Analytics
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2. METRICS
PROV IDE A STA NDA RD SYSTEM OF
MEA SUREMENT
MEA SURE SINGLE DATA POINTS
PROV IDE INFORMATION
GUIDE TA CTICS A ND OPERATIONS
STATE THE PA ST A ND PRESENT
PROV IDE TA BULA R OUTPUTS OF COUNTS
A ND RATES
A NA LYTICS
PROV IDE SYSTEMATIC COMPUTATIONA L
A NA LYSIS OF DATA OR STATISTICS
CONNECT MULTIPLE DATA POINTS
PROV IDE INSIGHTS
DRIV E STRATEGY
STATE THE PA ST, PRESENT, A ND PREDICT
THE FUTURE
V ISUA LIZ E PATTERNS A ND TRENDS
The Datafication of HR
Global competition for talent, outsourcing labor, compliance legislation, remote
workers, aging populations—these are just a few of the daunting challenges
faced by HR organizations today. Yet the most commonly monitored
workforce metrics do very little to deliver true insight into these topics.
Leaders need to graduate from metrics to analytics, uncovering the important
connections and patterns in their data to make better workforce decisions.
Definitions
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HR Metrics to Workforce Analytics
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3. The Datafication of HR: Graduating from
HR Metrics to Workforce Analytics
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Recruiting Effectiveness
Recruitment is the HR function that has the
most positive impact on revenue creation and
profitability.1
Yet common recruiting metrics,
such as “time to fill” and “offers accepted
rate,” do not answer strategic questions
about the quality and value of the people
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New hire performance Determine if new recruits meet expected performance levels, and adapt your
recruiting processes as needed
New hire performance by lead source Identify your best sources for top talent, more efficiently targeting your
resources to find the next high quality hire
Recruitment pipeline status Spot “supply chain” problems in your recruitment pipeline, and take remedial
action before they become a pain
Employee exits before 90 days service Assess the characteristics of new recruits resigning in less than 90 days to
improve your recruitment process
1 Boston Consulting Group, From Capability
to Profitability, July 201
2.
being hired. Rather, the following analytics
provide greater insight, enabling HR to take
meaningful action to improve recruiting
effectiveness, driving revenue creation and
profitability.
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Understand the level of effort required
to achieve your hiring goals to identify
areas for improvement and develop
more finely tuned strategies

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HR Metrics to Workforce Analytics
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Performance
Companies that excel at Talent Management
achieve earnings that are eighteen percent
higher than their peers. For a Fortune 1
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company, this can translate into hundreds
of millions of dollars in additional EBITDA
earnings.2
To truly understand and improve on
performance management, companies need to
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Pay for performance Correlate total rewards, compa-ratio, and performance levels to determine if you are effectively
rewarding performance—top performers will revert to average or resign if they do not perceive
themselves to be receiving a level of reward that recognizes their differential performance
Top talent characteristics Analyze the characteristics, tenure, work experiences, and managerial connections of your top
performers, leveraging your findings to grow future top talent
Career progression Analyze the promotion rates, lateral moves, promotion wait times, and internal hiring rates of top
performers to determine whether you are using the tools of opportunity to retain and maximize
performance—top performers will typically value opportunities for career progression even more
highly than their paycheck
2 The Hackett Group, Companies with Mature Talent Management
Capabilities See 1
8 Percent Higher Earnings, December 20 0 9.
look beyond metrics, such as “performance
appraisal participation rate” and “median
performance rating,” to analytics. W hen it
comes to analyzing performance to drive
business success the following areas should
be considered:
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Correlate compensation changes to
performance groups to ensure you are
paying for performance

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HR Metrics to Workforce Analytics
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Talent Retention
With voluntary resignations at a five-year
high,3
the competition for top talent remains
a constant, and retention of top talent is a key
objective for most HR teams. Indeed, “turnover”
Analytics, such as the key factors
decreasing and increasing resignation
rates, enable HR to more effectively
target and fine tune retention
strategies
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Predicting the risk of exit 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 Determine what factors increase and decrease resignations, more effectively targeting and fine
tuning retention strategies
Resignation correlations 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
Resignation segments Compare how resignation rates vary across locations, functions, tenure, age groups, diversity
groups, and so forth, to ensure program investments are targeted where they will deliver the
biggest results
3 Bureau of Labor Statistics, Job Openings and Labor Turnover Survey, November 201
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is the single most prevalent HR metric.
However, “turnover” does little to support
strategic business plans. To achieve true insight
a more in depth analysis is required.

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Movement visuals enable organi-
zations to analyze and optimize
their workforce network
Employee Movement
Organizations can be thought of as highly
complex systems, which have both a structural
element and a network element. The structure
is the organizational hierarchy, distribution of
work, and business units. The network is the
relationships and connections between people
within the organization. No matter how correct
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Movement in and out of organizational units 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 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 outside4
Leadership and succession modeling Tracking employee movement, promotions, and key experiences 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-Enz5
found a direct correlation between better succession management
and revenue
4 Boris Groysberg, Chasing Stars, 201
2
5 Jac Fitz-Enz, Human Capital Report, 20 0 9.
your structure, if the network element is missing
then your organization will not perform at its
best. The primary way in which this network
element is created and perpetuated is through
employee movement. The following analytics
provide a greater understanding of the impact
that movement has on an organization:
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Total Rewards
With compensation contributing to the largest
share of total expenses, it is imperative to ensure
that total rewards programs are competitive,
yet also aligned with business goals. Typically
compensation strategy and budgets are defined
The Datafication of HR
The challenges in today’s business environment
require new approaches to remain competitive
in an ever-shrinking world of global competition.
By graduating from metrics to analytics, HR
professionals and leaders can better understand
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Total direct compensation dynamics Understand the rate at which direct compensation costs are increasing and how this
reflects the FTE (full time equivalent) count in the business—if your costs are higher
and rising faster than your competition, then you are at a cost disadvantage, which
will impact profitability
Flexible workforce costs Identify effective cost management options by analyzing where people costs can
be flexed to reduce expenses or speed up revenue creation (for example, overtime
spending, budgeted salary for open hiring requisitions, forecasted bonus expenses,
costs of contingent workers, and so forth)
Employment movement impacts on
compensation
Understand how entries to and exits from an organization impact the total
compensation expenses
Total cost of workforce Move beyond total rewards and consider your total cost of workforce—including
taxes, long-term incentives, facilities, contingent labor, and other costs—to accurately
plan for the future
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The Datafication of HR: Graduating from
HR Metrics to Workforce Analytics
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the contributing factors that are impacting
their organization, and take the right actions
to implement programs that will provide a true
competitive advantage.
centrally, but allocations and decisions are
distributed throughout the organization. This
can create a disconnect between strategy and
execution. The best analytics approach is to
focus on the following areas: