HR is information rich and insight poor
INSIGHT = INFORMATION x CONTEXT
In this simple statement lies so much that is wrong with HR’s approach, meaning that the metrics and analytics we present to the wider business have little impact and do not enhance our credibility as a function. This disease has three key symptoms:
Business versus HR context – there needs to be a much better connection between what matters to our organisations and what matters to HR. A lack of strategic workforce planning capability in HR means that it is hard for HR functions to know what best to measure, or to move past generic measurement.
Internal versus external data – Marketing know how to do this. They are experienced in segmentation and gathering information about what these segments want. In HR, however, we have an over-dependence on internally-generated data relating to existing employees, typically through mass-market tools such as engagement surveys. We need to make more of internal data by segmenting it and looking at what it says in the context of the people and organisational risks to the business; and generate more external data via focus groups or external partners to help us understand what potential “career consumers” want.
Process versus outcome – HR loves process, but this love also extends to what we measure. Many of our metrics actually measure process not outcome, making it hard to say if we are doing the right thing. HR tends to focus on whether or not the performance management process steps have been delivered on time, and then focus on ratings, without ever checking if the objectives that are being set and rated are in fact the right objectives.
A ubiquitous succession planning metric is % critical roles with ready-now successor. In fact, all this metric really does is to count empty boxes. It doesn’t tell us what actually happens. A better metric is when a critical role becomes available, on what % of occasions is it filled by a person on the succession plan? I have personally witnessed a figure of 98% in the former metric become just 8% in the latter. Process measures are part of what we need to do, but when we focus too much on them to the exclusion of outcomes, we not only lose relevance but we paper over risks to the business.
HR has data, but often doesn’t know what question to ask it – or what to do with the answer. Nowhere is clearer than via a quick exploration of HR Data Packs created for senior leadership meetings. We tend to lead with data we understand and have, rather than working out what data we need and the best way of getting it. Have we worked on our data to interpret it to what is important to the organisation? Does it yield insights into why productivity is too low? Does it give clues as to why we are slow getting products to markets or highlight risks to the strategy? Or does it just tell us that the proportion of women versus men is the same as last quarter?