Josh Bersin_Big Data in HR

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BigData in HR How to build a world-class Talent Analytics function

Josh Bersin Principal, Deloitte Consulting LLP May, 2013

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Research & BigData Working Group

8 years of research into the measurement, operations of L&D, leadership, recruiting and HR

20 leading practitioner organizations advising us on strategy

Our goal: education and best-practices on how to build an analytics function

Develop assessment services and tools to help you understand how to advance your program

Continue to study state of the market and the best-practice solutions

http://www.bersin.com/hrbigdata2012

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Agenda

Why BigData in HR is Needed Defining BigData in HR What we have learned The Four Stages Case Studies Where we are

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Todays Global Talent Challenges

We have entered a global economy where talent and skills shortages challenge world economic and business growth around the world.

- Klaus Schwab, Chairman, World Economic Forum

Despite the high unemployment rates in many countries, more than 65% of global leaders cite talent and leadership shortages as their #1 business challenge.

- Bersin & Associates TalentTrends, Fall 2012

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2013: A Nexus of Change

nexus (Noun)

A connection or series of connections linking two or more things.

A connected group or series: "a nexus of ideas".

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A Nexus of Talent Challenges

Agile Management & Leadership Models

A New Generation of HR Practices and New Type of HR Organization

New Technology

Social Tools, Analytics

Need for Improved HR skills and capabilities.

Business Speed and Scale

Disruptive Competition

1

Shift toward Emerging Markets

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Borderless Workplace

Team Model of Work

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Specialization Contingent Work

New Job & Career Models

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21st Century Models of

Leadership

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Competition for Talent

Social Sourcing & Recruiting

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How the Workforce has Changed

From The Shift Index by Deloitte

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Young, Diverse Workforce .

By 2013, 47% of employees will be those born after 1977. -- US Census Bureau

In 2012, 32% of employees are planning on leaving their employers, vs. 19% two years ago

Only 55% of employees believe their employer is a sound long term place to work vs. 65% over last three years.

People under the age of 35 are twice as likely to be looking

for new work as older workers.

- Mercer October 2011, Towers Watson July 2012

Has Created Challenges in Engagement

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Increasing Work Specialization Expertise drives competitive

advantage

Specialization improves quality and reduces cost

Deep skills developed through deliberate practice and reinforcement

Deep skills come from a range of developmental experiences

Intelligent leadership paths, career paths, training, work assignments, understanding high-performing competencies are all drives of success.

Back Office, Operational, Contingent Employees

Functional Specialists / Front-Line Employees

Top Management

Senior Management

Middle Management

Senior Specialists First Line

Management

The Experts

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Agenda


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Do YOU know.

What characteristics drive high performing sales people? What work assignments will lead to strong leadership? What attributes of a job candidate will lead to perfect fit? Why retention is low in certain locations and jobs? What is the real result of poor on the job safety? Why some of your top people leave for competitors What compensation and rewards will drive most value? .

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BigData in HR Defined Big data is a collection of data so large and complex that

it is difficult to process using traditional data processing applications.

- Wikipedia

The typical HR system has more than 400 data elements about your own employees, and this data is being updated nearly every day.

We all have BigData opportunities within our own HR, training, recruiting, and talent organizations.

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Analytics is Definitely Coming to HR The Evolution of Business Analytics in other Functions

The Industrial Economy

The Financial Economy

The Customer Economy and Web

The Talent Economy

Early 1900s 1950s-60s 1970s-80s Today

The Waves of Business Analytics

Steel, Oil, Railroads Conglomerates Financial Engineering Customer Segmentation Personalized Products

Globalization, Demographics Skills and Leadership Shortages

Logistics and Supply Chain

analytics

1980s Financial and

Budget Analytics

Integrated Supply Chain

Integrated ERP and Financial

Analytics

Finance & Logistics

Customer Analytics CRM

(Data Warehouse)

Customer Segmentation

Shopping Basket

Web Behavior Analytics

Predictive Customer

Behavior - CRM

Customer & Marketing

Recruiting, Learning,

Performance Measurement

Integrated Talent Management Workforce Planning

Business-driven Talent analytics

Predictive Talent Models HR Analytics

Talent & Leadership

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This Science is Coming to HR

Definition of Science: Systematic knowledge of the world gained through observation and experimentation.

What is Not Science

Making talent decisions on the basis of gut feel, beliefs, or philosophies.

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How do Companies Hire People? 2/3 of hiring done without any significant assessment

Background checking: 79% Managerial interviews: 64% Interview training: 47% Behavioral assessments: 34% Reference calls: 32% Skills-based assessments: 25%

% of Organizations Which Regularly Use Following Assessment Practices

Bersin & Associates High-Impact Talent Acquisition Study, Fall 2011, 158 organizations responded

2/3 use no real assessment process

at all leaving the process to

hiring managers or recruiters

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Big Insurance

A $33 billion insurance company has developed a behavioral assessment based on a set of beliefs held by the top executives

Top sales people need college degrees from top rated schools, they should have good grades, and they should have experience selling high value products.

But the data proves otherwise.

Insurance Company

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Results of Data Analysis

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Insurance Company

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Data Showed Six Things Matter:

Very Highly Correlated with Success 1. No typos, errors, grammatical mistakes on resume. 2. Did not quit school before obtaining some degree 3. Had experience selling real-estate or autos 4. Demonstrated success in prior jobs 5. Ability to succeed with vague instruction 6. Experience planning time and managing lots of tasks

The Belief System

Was Wrong

Within six months of implementing a

new screening process

revenues went up by $4 million

What Did NOT Matter

Where they went to school What grades they had The quality of their references

Insurance Company

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Moving to Predictive Analytics

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Agenda


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The Big Aha! In HR, talent, leadership, and capabilities you already have

most of the information you need to deliver breakthrough new solutions for your organization.

What most organizations do not have is the organization structure, skills, leadership, and tribal knowledge to use this information yet. Many of the skills are likely available in your organization.

This marketplace is rapidly evolving and over the next two years

companies who do not implement a BigData in HR strategy will fall behind those that do.

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We Dont Measure the Right Things

Source: Bersin & Associates 2012 High-Impact Learning Organization (HILO)

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Focus on The Problem, not the Data Business problem first, then focus on arranging and using the data

Why is turnover high in some areas?

What drives sales productivity?

Why is their fraud in some branches?

What sales or service processes drive account renewal?

What is the impact of training on long term productivity?

How do we assess the right candidates for sales?

What will our talent gaps be next year based on retirement?

Business Problem Data

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The Yahoo Question

Are the people working from home getting enough work done?

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Treat Measurement as a Process Why you must build an analytics function, not a set of tools

Measurement as Process, not a Project

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The Four Keys to Success 1. Reliable

- Data must be true and validated over time - Seasonal changes, organization changes, must be handled

2. Actionable - Reports must be detailed enough to let managers take action - Drill, filter, group data so it is relevant and meaningful - Goal is a business-driven dashboard (red/yellow/green)

3. Scalable - The process of collecting and analyzing data must scale - Your outputs must be useful for people at all levels

4. Understandable - People must be able to visualize and understand what you find - Line managers, executives, and employees must use the data

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The Rich Sea of Data Opportunities Workforce Plan

Scenarios

Time and Cost To Hire

Internal Mobility

Employer Brand, Alumni

Managerial Grievances

Span of control

Skills Certifications

Open Positions

Development Plans

Tenure Education, etc.

Retirement Projections

Age, geography, Skill level

Talent Demand Plan

Onboarding Effectiveness Turnover

Ratings Rankings

9-box Grids

Succession Depth

Seniority Skills Depth

Promotional Readiness

Employee Opinion

Employee Engagement

Employee Value Prop

Innovation Programs

Readiness

Demographics

Supply, Demand

Recruiting Onboarding

Performance Succession

Engagement

Spending Satisfaction With HR svc. HR/L&D

Staff Allocation HR/L&D

Spending Systems Usage/$

Succession Depth

360 and Other Assessments

Proficiency vs. Leadership Comp.

Successor Readiness Leadership

Budget by Group

Comp by level/perf

Compa Ratios

Perf-Pay differentials Compensation

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Understanding HR measures

Hundreds of HR measures Many easy to find Many not easy to find

Need for data dictionary Basic principles for success

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HR Programs & Processes (Status and maturity of HR Processes )

Learning Program Effectiveness I Total Rewards Effectiveness I Performance Management Effectiveness I On-Boarding Time to Productivity I Recruiting Effectiveness and Effieicney I Candidate Pipeline I Total Rewards

Workforce Demographics (Facts and statistics about employees, alumni, and contractors)

Payroll and Benefits | Demographics I Background I Experience I Tenure I Organization Structure I Spans of Control I

Capabilities, Talent, & Leadership (Capabilities, leadership, progression, career, talent.)

Leadership Pipeline | HiPOs I Stack Rankings I Pivotal Role Pools I Mobility | Compa Ratios I Rewards I Skill gaps I Certifications | Readiness I Turn-over I 360s I Technical Skill Pools I Career Progression | Development Plans | Succession Depth and Pools

Workforce Performance (How people impact the business)

Financial results by person and unit I Net Promoter scores I Performance and Goal attainment I Innovation/Patents | Product measures

Engagement & Culture (Employee engagement, wellness, and satisfaction including external view)

Engagement I Management Grievances I Turn-Over I Referral Rates I Exit Interviews I Development Plans | Diversity and Inclusion

Bersin HR Measurement Framework

HR, Recruiting, and L&D Effectiveness

Organizational Readiness

Talent & Leadership Supply Workforce Planning

Manager and Employee Dashboards

Scenario & Future Planning

HRMSs Payroll and Employee Demographic and System of Record Data

Applicant Tracking | Recruiting System

Applicant, source, recruiting data

Performance & Talent System

Performance, development planning, succession, talent pool data

Learning Management System

Learning, certification, skills delivery, content, learning organization data

Compensation System(s)

Salary, benefits, budget, bonus and comp related data, payroll feeds

Workforce Planning System

Scenarios, talent supply, demand org charting

Third party data:

assessments, employee

engagement, external brand, social networks

External Data and B

enchmarks

(External B

enchmarking of all H

R M

easures) Internal H

R M

easures I HR

Program

Effectiveness I

Workforce M

easures I TM M

easures I People P

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Talent Acquisition, Brand, Sourcing (How well you are reaching candidate audiences)

Employment Brand | Talent Pipeline | Time and Cost to Fill | Quality of Hire

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How HR Data is Typically Organized

Recruiting and Workforce Planning

Comp and Benefits

Performance Succession Engagement

Learning & Leadership

HRMS Employee

Data

HR Operations

Your goal is to integrate this information, over time, into a credible, actionable, scalable, understandable

Talent Analytics function one which delivers relevant Information, models, and tools to line leaders and executives

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HR Manages a Plethora of HCM Products 87% have more than two systems 20% have more than 6 systems 7% have more than10 solutions 18% of large companies report use of more than ten HCM different systems

57% plan to procure new software within the next 18 months 61% will both replace and procure new solutions 23% will solely replace existing solutions;16% will solely add new products.

33% will replace standalone TM applications 22% with an integrated suite. 10% will replace their existing suites.

Finding the Data is Work

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The Problem with the Systems Market

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Why You Need a Data Dictionary

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Standards Remain Elusive You cannot wait.. you have to develop your own

Other Standards Out There: Bersin by Deloitte Factbooks Turnover Metrics (SHRM) Diversity & Inclusion (SHRM) SAP Book of Data TDR Reporting (Yay!) Engagement Standards (coming) SASB Sustainability Many more

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Tools Alone are Not the Solution

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Agenda

The BigData Priority Why Talent Analytics Guidelines for Success The Four Stages Final Thoughts

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Talent Analytics Maturity Model

Level 1: Reactive Operational Reporting Operational reporting for measurement of efficiency and compliance

Data exploration and integration, Development of data dictionary

Level 2: Proactive Advanced Reporting Operational reporting for benchmarking and decision making

Multi-dimensional analysis and dashboards

Level 3: Strategic Analytics Segmentation, statistical analysis, development of people models;

Analysis of dimensions to understand cause and delivery of actionable solutions

Level 4: Predictive Analytics Development of predictive models, scenario planning

Risk analysis and mitigation, integration with strategic planning 60%

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Level 1: Reactive Operational Reporting Goals:

- Implement a scalable, accurate, easy to use reporting environment - Understand all the data and systems you have to work with

Tasks: - Understand and collect data you have - Build a Data Dictionary - Work with IT to implement standard reporting tools

Key Skills - Patience and database interest - Great relationship with IT - Ability to write, document, and manage projects

Expected Outcome - Standard tools and reports - Ease in responding to any report request - Tools to help managers find their own data

1

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Level 2: Proactive - Advanced Reporting 2

Goals: Develop skills and tools to implement proactive reporting and tools for line managers Look at trends, benchmarks, and results against plan Develop actionable business dashboards

Tasks: Understand all the dimensions of your data (how it will be drilled and filtered) Audience analysis who are your audiences and what decisions do they make? Performance consulting start focusing on one or two major problems Purchase or select benchmarking data

Key Skills Understanding of multi-dimensional reporting Business acumen and relationship with finance organization Strong business alignment and partnership with business leader (or leader) Ability to influence what IT does

Expected Outcome Dashboards used by the business A business unit success

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Level 3: Strategic Analytics 3

Goals: Developing causal models or people models which identify cause and effect Segmenting people into groups which can be analyzed in detail Integrating data with recruiting, performance, compensation, leadership, etc.

Tasks: Building strong relationships with all areas of HR Selecting a key problem to start analytic study Implement analytics project, iterate, and demonstrate results

Key Skills Analytics and statistics skills Information visualization and compelling presentation skills Excellent performance consulting and ability to understand work environment Partnership with line executives and ability to focus on key problems Skills in development of tools across many areas of HR and Talent Management

Expected Outcome A success project which delivers some breakthrough findings Direct change or decision-making tools in the hands of the business

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Level 4: Predictive Analytics 4 Goals:

Putting place models which can predict future scenarios Integrate your work with workforce planning and business planning functions

Tasks: Expand your analytics skills and expertise Directly connect with business planning, finance, and recruiting teams Expand relationship with 3rd party data, engagement, and consulting firms

Key Skills Modeling and deeper statistics skills Finance and business planning Senior experience in organization design Strong relationship with or deep experience in workforce planning and acquisition

Expected Outcome A workforce planning model which describes how performance can be improved Repeatable models which can be extended into new domains Credibility with Finance An integrated, strategic analytics function

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Key to Success

Developing Credibility Strong Relationship with IT Sharing Experience across analytics teams Patience to validate data before it is shared Multi-year analysis to experience seasonal trends Need to present findings in an understandable way Skills in visual design and presentation Focus on business solutions, not HR solutions

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Agenda


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Examples of Breakthrough Solutions

Major Retailer developed integrated people model to correlate relationship between engagement, rewards, leadership capabilities, tenure, skills and revenue.

Major Payroll Provider statistically validated 30+ factors in recruiting which led to 20%+ improvement in sales performance and completely revamped recruiting process

Major Food Service Company identified key drivers of account renewal and upgrade and developed statistically valid measures which have been used to create company-wide dashboard which measure risk on a weekly basis

Major Retail Bank correlated dozens of workforce measures against engagement and branch financials to develop risk management dashboard for small and large branches

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Why is our China Leadership Pipeline Weak? Energy Company

College Degree

Job Level

College Major

Job Type

Home Geography

Work Geography

Hire Date

Org Unit

Position Held

Position Level

Hipo Level

Work Country

Trainings Completed

Date Since

Training

Promotion Type

Date Promoted

Perform. Tier

Tenure

1. Examine Historic Data & Outcomes

2. Build A Predictive Model

MBA vs. Engineering Degree Lack of US Experience Different criteria for success

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2011 - 2012 Advanced Statistics & Social Research Acumen;

Engineering Degree; Customer Research Background; Statistics & Data Mining

Critical Thinking; Story Telling; Data Visualization;

Ability to see data, and decipher insights

2009 - 2010 Business Acumen; HR, Finance, Economics Degree;

Quantitative Research Design & Analysis Passion for Data & Analytics; Strong Technical skills

Consulting & Presentation Skills; Analytical Curiosity; Problem Solving;

Collaborative; Teamwork; Networking Skills

2007 - 2008 Solid Understanding of HR; I/O Psychology Degree;

Employee Research Background; Qualitative Research Design & Analysis; HRIS; SPSS

Strong Communication & Interpersonal Skills; Detail Oriented ; Project Management

The Evolution of Data Skills and Competencies Large Retailer

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2008 Employee Engagement Model Employee Segmentation LVI Learning

2009 Diversity & Inclusion Leadership

2010 Learning & Professional Development Employee Lifecycle Research HR Scorecards Reactive Analytics

2011 Company Health Pentagram Employee Research Cohorts Human Capital

Executive Dashboard

Proactive & Exploratory Analytics

2012 Enterprise Measures of Success Talent Change Adoption Predictive Analytics

The Modeling Journey Retailer

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An Evolved Organization

VP Human Capital Analytics

Director Org Diagnostics &

Design

(2) Sr. Consultant

ODD

Program Manager

Director Workforce Analytics & Research

Manager Workforce Analytics

(2) Sr. WFA Analyst

Manager Employee Research

Analyst Employee Research

Manager Learning Analytics

Consultant Learning

Measurement

Analyst Learning Analytics

Business Operations Specialist

Manager HR Brand Content

Retailer

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Purpose of Department Organizational Research, Analysis, and Planning Department Help to achieve a competitive advantage through

providing strategic HR analysis focused on talent

Build a culture of analytics and planning within the Global Human Resources function

Provide HR Intelligence through the highest quality; most valid and reliable analytical products and services

Manufacturer

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2011 2010 2009

2008

2007

Oct. 2006

Explore Execute

Evolution of Human Capital Analytics Team

Start of department One person

Focus on Advanced HR Studies & Corporate HR Scorecard Audience equal CHRO Report to Director of HR

Functional Excellence Receive goals from CHRO Sourced two part-time I/O

Psychology interns

Two person department (Hired Ph.D. I/O Psychologist)

Added focus on Job Analysis, Competency Assessment, &

Organizational Culture Report to VP of Talent Acquisition & HR

Functional Excellence Audience equal CHRO & Staff

Goals from CHRO

Added focus on Global HR Scorecard, Workforce Forecasting, Performance

Management , and Training Effectiveness Report to VP of Talent Acquisition & HR

Functional Excellence Audience equal mostly HR; but also business

and Functional leaders Receive goals from CHRO & Staff; some

Functional/Business leaders

Strategize Operate

Downsized to one person Added focus on Talent Acquisition

Same reporting structure Audience equal HR, functions, &

business leaders Receive goals from CHRO, Business

Leaders, and Functional Officers Hired two people in India (operations research & BI)

Eight person department Aligned department by business and region

Added focus on predictions, scenario planning, succession planning, HR processes, on-site root-cause

analyses & OD Audience equal HR and non-HR leaders down to the

plant/facility level Report to VP of HR Functional Excellence

Receive goals from CHRO, Business Leaders, and Functional Officers

A great deal of hiring

Fourteen person department Added focus on organizational structure,

potential countries to do business, and labor cost forecasting

Report to VP of Talent Management & Organization Effectiveness

Goals provided by HR and non -HR leaders Audience is the same

Implement HR BI with Oracle (OBIEE), Reporting Service Center

Impress Implement

Manufacturer

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Collaboratively

Identify Solutions

Present Results and Potential

Solutions

Convert Data to Actionable

Information

Collect Data

Formulate Study Plan

Identify Solution

or Problem

Advanced HR/Business Studies

HR Planning through Data Analysis

HR Measurement On-Site Consulting and/or Client Engagements

Centralized HR Reporting, Analysis, and Benchmarking

Building a Culture of Analytics Through Training & Development

DESIGN IMPLEMENT

Key Deliverables Roadmap

20%

15%

20%

20%

25%

40%

5%

10%

5%

40%

2007 2012 Key Deliverables & Time Allocation

Manufacturer

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Building A Culture of Analytics

COMPETENCY

ACC

OU

NTA

BIL

ITY

Know what data is in the system and

how to access it.


how to access it.

Understand what data is captured in the system and what it represents

Understand how to run reports and create ad hoc

reports

Analyze and interpret data and metrics

Analyze data and evaluate trends

Drill down in order to ask the question

behind the question

Understand the why behind the

what Conduct root cause analysis


Translate, analyze and present data to various audiences Identify business

issues that are being impacted

Create actionable HR plans the

positively impact the business

Understand analytics and present data

to tell a story


Design solutions to support

specific business strategies

Be anticipatory & participate in whats next

decision making Proactively

initiate actions to improve

organization-wide

performance & avoid incoming

issues Understand leading vs.

lagging indicators

Re-evaluate using

quantitative analyses

Sustain best practices and

eliminate waste

Understand analytics and present data

to tell a story

Establish a plan and execute a

plan with the data

Accessing the data Executing with the data Interpreting the data Presenting the data


how to access it.


how to access it.

Manufacturer

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The Skills Issue

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The WhatWorks Approach Talent Analytics Fits into our High-Impact HR Framework


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Conclusion

BigData in HR is has become a business imperative

Integration of analytics teams and building capability are key, not tools and technology

Analytics is a journey which will change the way you think

Talent analytics will extend to the other business analytics groups in your organization

Expertise and patience is key, but focus on key business problems first


BigData in HRHow to build a world-class Talent Analytics functionResearch & BigData Working GroupAgendaTodays Global Talent Challenges2013: A Nexus of ChangeA Nexus of Talent ChallengesHow the Workforce has ChangedYoung, Diverse Workforce .Increasing Work SpecializationAgendaDo YOU know.BigData in HR DefinedAnalytics is Definitely Coming to HRThe Evolution of Business Analytics in other FunctionsThis Science is Coming to HRHow do Companies Hire People?2/3 of hiring done without any significant assessmentBig InsuranceResults of Data AnalysisData Showed Six Things Matter:Moving to Predictive AnalyticsAgendaThe Big Aha!We Dont Measure the Right ThingsSlide Number 24Focus on The Problem, not the DataBusiness problem first, then focus on arranging and using the dataThe Yahoo QuestionSlide Number 27Treat Measurement as a ProcessWhy you must build an analytics function, not a set of toolsThe Four Keys to SuccessThe Rich Sea of Data OpportunitiesUnderstanding HR measuresBersin HR Measurement FrameworkHow HR Data is Typically OrganizedFinding the Data is WorkThe Problem with the Systems MarketWhy You Need a Data DictionaryStandards Remain ElusiveYou cannot wait.. you have to develop your ownTools Alone are Not the SolutionAgendaTalent Analytics Maturity ModelLevel 1: Reactive Operational ReportingLevel 2: Proactive - Advanced ReportingLevel 3: Strategic AnalyticsLevel 4: Predictive AnalyticsKey to SuccessAgendaExamples of Breakthrough SolutionsWhy is our China Leadership Pipeline Weak?Slide Number 50Slide Number 51An Evolved OrganizationPurpose of DepartmentOrganizational Research, Analysis, and Planning Department Slide Number 54Slide Number 55Slide Number 56The Skills IssueThe WhatWorks ApproachTalent Analytics Fits into our High-Impact HR FrameworkConclusion

Josh Bersin_Big Data in HR

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