How to start using data and evidence in HR

Evidence-based HR, the scientific approach to devising and implementing HR policies and practices, has gained traction over the past year. However, despite all the hype, there is still a challenge in implementing it effectively. The approach may be scientific, but the implementation needs to have an understanding of people at its heart, managing director of SharedXpertise Faye Holland says.

Data can greatly improve the strategy behind the HR function. However, many HR directors still lack the profile in their organisation to change established practices. So, while hoping to take an evidence-based approach, the reality is that many old habits and approaches remain.

HRO Today Forum Europe
This topic and others will be debated as part of the “Evidence Based HR” track of this year’s HRO Today Forum Europe in London on 12-14 November 2013. Deloitte’s Laurence Collins and Loudhouse Consultancy’s Billy Hamilton-Stent will be speaking on the subject on the morning of Wednesday 13th. For more information or to register your interest, please visit the HRO Forum Europe website.

HR is often seen as a business division that runs on “soft” skills, but data can help it to become a more strategic function. By proving a connection between engagement and productivity, you can create a business case illustrating that investment in data will allow you to measure these and therefore make improvements.

Baby steps

The key is to start small: begin by proving the merit of a more informed approach, demonstrating the findings that it can deliver and how the insights challenge the status quo.

After you have senior leaders on board with a small-scale data project, what next? The prospect of analysing reams of data can be daunting, particularly if data collection and analysis business-wide is in its infancy, as is the case in many fast-growing, mid-sized companies.

One approach is to be realistic about the levels of data the business can analyse.

Management consultancy Deloitte, for example, identifies four levels of business data analysis. At the most basic level is operational reporting. This is essentially reactive and involves looking back and comparing actual outcomes against what was originally desired.

The next level is advanced reporting real-time monitoring that is more proactive and is designed to assist with benchmarking and decision making, such as monitoring the impact of a change programme.

At the third level is advanced analytics. This comprises the ability to identify what makes a really good hire, based on the characteristics of those who have gone on to be successful employees in the past, for example.

Finally, there is predictive analytics, such as identifying which top performing employees may leave the business within the next 12 months.

Choose your tool wisely

Choosing the complexity of your data approach is even more important when considering investment decisions about tools to capture or track this information.

As Cath Possamai, the managing director for outsourcing provider Capita, says: “There are some very advanced analytic solutions offered by HR outsourcing providers. First of all, a proper assessment needs to be made of a business’ maturity level so that any tools and analytics can be tailored to extract useful and usable information.”

To get started, it is worth thinking about what level of data you and your business can capture and consider at the outset, and familiarise all key bodies with using and interpreting this data before migrating to larger and more ambitious data projects.

Billy Hamilton-Stent, managing director at Loudhouse Consultancy, says that data collection and analysis need not be difficult: “One solution is to run a monthly staff satisfaction survey. It doesn’t need to be complicated; one large business we work with simply asks its employees ‘are you happy?’ on a monthly basis and tracks sentiment based on the yes or no answers.”

Avoiding overload

The flipside to all this is that sometimes we can face data overload. A pragmatic approach is needed to determine what needs to be sourced and what effectively will lead you down the equivalent of a data “rabbit hole”.

Laurence Collins, HR transformation and analytics director at Deloitte, says: “You have to be thoughtful about whether or not more data is likely to yield valuable insights. Research suggests that three-quarters of corporate executives in large companies aren’t getting value from half the data they already own.”

The key is to take a staged approach. Prove the value at each stage and take people with you. This will become crucial when it comes to getting support for mining ever more detailed data, securing approval for investment on supporting tools, and also taking seriously new policies and practices that result from this insight.

Faye Holland is managing director of SharedXpertise, organisers of the HRO Today Forum Europe.

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