How to tell the difference between good and great HR Analytics – part II

04/01/2013 at 14:17 5 comments

In my last post I argued that great workforce/HR analytics share four common traits; they are

  1. predictive
  2. made on reliable data
  3. combined with qualitative data (and perhaps some intuition)
  4. used an evidence based approach.

But there is one thing missing and probably the most important thing; It must be based upon a strategic approach. I know that”‘strategic” is such an overused word in HR now and frankly most of what is said about strategic is anything but. However there is no getting away from the fact, that you can do good analytics with the above four traits without actually adding much value.  Without doing analytics on the right things AND in the right way it really amounts to very little.

Or to put it in another way: Workforce analytics without a strategic approach will only with the help of luck turn out to be truly value added.

What does strategic approach mean in practice? The best way to illustrate this is to look at the difference between a bottom-up or top-down approach.

Strategic HR Workforce Analytics

Analytics can be bottom-up (operational) or top-down (strategic). The bottom-up approach is the approach many take. They combine their data into Big Data and look through interesting ways of diagnosing, measuring, illustrating, visualizing, trending and reporting the data. They find interesting links between employee turnover and profits (no kidding!), talent profiles and performance or particular training programs and customer satisfaction. That’s when they are good. Sometimes they just show which divisions are experiencing lower employee turnover!

The top-down approach on the other hand start with your HR strategy (which of course is aligned with the business strategy). You then look at which areas you want to focus your HR efforts. Then you find the desired knowledge you require to make the right decision. The you design the data required to provide you with this knowledge.

Good analytics made from a bottom-up approach can give good results; they can surprise you, show links you hadn’t seen before and even challenge your strategy. BUT that approach must not stand alone. The primary use of analytics should be top-down. That’s the strategic approach and that is likely to support you most.

Remember: Workforce Analytics is ‘just’ a tool to make better HR decisions. It is a great tool for that, but if you are an HR executive looking to make strategic HR decisions, your analytics has to be strategic too. Don’t look at the data you’ve got and make the best of them but instead look at what data you need to create the most value-added predictive analytics.

Entry filed under: Analytics. Tags: , .

The Top 5 Posts of 2012 from the ‘All About Human Capital’-Blog The best definition of talent for your talent management program

5 Comments Add your own

  • 1. Marcus Champ  |  06/01/2013 at 05:28

    Morten

    I have followed your blog (albeit quietly) for some time and wanted to take this opportunity to wholeheartedly agree with your sentiment. Personally I have found the bottom up approach to be very useful, insightful, and can find a lot of “low hanging fruit” workforce opportunities and risks. In the long run however this approach can only take you so far and is only ever likely to lead to incremental change or improvement…only with a strategic perspective will true value be unlocked.

    Thanks for your blog and if I am lucky I will have the opportunity to collaborate with you one day.

    Regards

    Marcus

    Reply
    • 2. Morten Kamp Andersen  |  06/01/2013 at 20:31

      Marcus,
      Thanks a lot for your kind comment. I am very glad that you like my blog and agree with my sentiment.
      Who knows – perhaps our paths will cross one day and we can collaborate.
      Stay in touch
      Best
      Morten

      Reply
  • […] In my last post I argued that great workforce/HR analytics share four common traits; they are predictive made on reliable data combined with qualitative data (and perhaps some intuition) used an ev…  […]

    Reply
  • […] are emerging which requires specialists. Just take the area of HR data which includes Big HR Data, Analytics and the fact that HR is being more software driven in general. To master this HR must employ […]

    Reply
  • […] consider the journey: First you must work on something which is highly important and valuable to the business. Then you must use all available data to make analysis which gives new insights and knowledge upon […]

    Reply

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Trackback this post  |  Subscribe to the comments via RSS Feed


Enter your email address to subscribe to this blog and receive notifications of new posts by email.

Join 1,608 other followers

Latest Tweets

Error: Twitter did not respond. Please wait a few minutes and refresh this page.

Feeds


%d bloggers like this: