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Looking for HR – or Any – Job Security? Try Analytics

Feature Article | August 16, 2017 by Jenny Dearborn

It’s never been more important for human capital management professionals to take a good, hard look around and ask themselves whether they are truly preparing for the future.

With powerful forces like artificial intelligence, big data, the sharing economy, and others bearing down on businesses around the globe, we’ve never faced a time of greater or faster change.

With predictions about robots taking over human jobs and 50 percent of people-driven work activities disposable right now, according to McKinsey, it’s urgent that we change how we think about our work. It’s not about saving human resources (HR) jobs per se: while many of them can and will be automated, the types of intuition and emotional intelligence HR requires will help ensure that humans remain relevant to the HR function. But which humans?

If you think they’re the same ones filling HR roles now, think again.

As workforce needs become harder to predict and the future of work itself more uncertain, indispensable HR professionals will be ones with business savvy who can speak to senior leaders in their language and bring a sophisticated lens and skill set to the job of determining what people a company needs to survive and thrive.

CEOs are already bringing in executives from marketing, operations, or finance – disciplines that have been using data and analytics for years to drive their operations and outcomes – to lead HR. That’s not surprising, given how far this function tends to lag behind others.

  • According to recent research from Deloitte, 71 percent of companies think HR data analytics is an organizational priority but fewer than 1 in 10 report having usable data.
  • The CEB found that most HR professionals don’t even link job candidate experience to business goals, and only about half use talent metrics to inform business decisions.
  • 41 percent of respondents to a 2015 com poll said they use data only for basic reporting (what has happened), vs. just 8 percent harnessing information for predictive analytics (what might happen), and a mere 3 percent for prescriptive analytics (what to do in response to what might happen).

Still skeptical about whether HR needs to catch up, and the importance of analytics in corporate life? Consider the meteoric growth in the number of companies with a Chief Data Officer: from just 12 percent in 2012 to 54 percent in 2016.

A new SAP SuccessFactors and Harvard Business Review study – HR Analytics: Busting Siloes and Delivering Outcomes – provides some helpful guidance. A key first step is understanding what’s keeping HR from embracing analytics.

The study identifies these barriers to leveraging HR analytics:

  • Lack of integrated data: It’s critical for companies to broadly analyze available information to understand the links between employee and business performance.
  • Lack of analytical capability: HR organizations may want to seek out their own analytical talent rather than rely solely on centralized corporate data functions.
  • Lack of frameworks and standards for HR metrics: It’s similar in Learning & Development. The lack of consistent mechanisms and units of measure stymy our progress and make it nearly impossible for business executives to “get” our impact.
  • Lack of integration in HR: While integrated talent management approaches are becoming more common, HR is still too siloed, with separate recruiting, compensation, and other functions that would be vastly more effective if coordinated.

A key piece of advice from the study was from Peter Cheese, chief executive of London-based CIPD, the Chartered Institute of Personnel and Development. To even get on the radar of executives to discuss analytics in the first place, Cheese encourages HR professionals to use the language of risk – what could happen if the company does not take step X, Y, or Z. His theory is that business leaders may respond better to a potential blow than to a potential benefit.

Indeed, losses loom larger than gains, per the seminal 1979 research on prospect theory by Kahneman and Tversky (the subject of Michael Lewis’s latest book, by the way). I employed that theory myself in this very article, by pointing out the risks to HR professionals who do not up their game, in analytics and elsewhere, in order to hopefully spur you to action.

Please let me know if it worked.

Access the HBR report and learn more about how HR can become a valuable player in strategic decision making here.

And for more on HR analytics, read Jenny’s new book (publication date: November 2017), The Data Driven Leader: A Powerful Approach to Leading with Analytics, Driving Decisions, and Delivering Breakthrough Business Results.

Jenny Dearborn is senior vice president and chief learning officer at SAP

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