Since the year dot, HR has been wondering why it’s not “on the board”. And when it is on the board, it wonders how it can stay there. Or how it got there in the first place. There are few occupations who navel-gaze so willingly.
The answer to all of these questions is summed up in four letters: data.
One thing that HR has always had is data. People data. The capabilities may not always have been there to amass and analyse that data, but it has always existed. Many organisations are now waking up to the potential held within their metrics, and are developing an understanding of how those metrics correlate with business success, or failure.
A simple example would be voluntary turnover of sales staff. How does this correlate with sales figures in the same period? It’s quite likely that if there was a high turnover, then sales figures would be low compared to periods where there was low turnover of staff.
A more complex example would involve taking engagement survey data and correlating that with departmental performance statistics. Deep-diving into engagement survey data gives insight into the various levers that HR can pull in order to better understand what is driving success (or failure).
For instance, a marketing team could be perceived to be underperforming. There will be marketing metrics to understand what is happening, but the people metrics are there to explain why it is happening. Engagement surveys can throw up problems with line management or remuneration, and this can correlate with absence and sickness statistics. Exit interviews / questionnaires, as Lisa Butler points out, can actually result in actionable data, so long as they are consistent.
As HR has moved increasingly towards a shared-service environment, it is easier than ever to centralise this more transactional data. HR’s big opportunity is owning and interpreting this data, reporting on it and saying “hey, I know why you’re not performing well here, and I can help you change it.”
I disagree with Phil Simon, who wrote in the Huffington Post about the “sad state of HR”. I don’t think HR is the “redheaded stepchild” of an organisation either (potentially offensive to both red-heads and stepchildren!) I especially don’t agree that HR are administrative, anachronistic behemoths who don’t understand how data works. I really, really don’t agree that HR departments make decisions based on gut instinct.
However, he’s right when he says that data is HR’s big opportunity. He’s partly right when he says that HR people don’t use data as well as they could. With the mass of data related to payroll, remuneration, productivity, performance, engagement and retention, HR can focus in on the influencing metrics that define business performance, and potentially offer predictive insight.
This data, which some call “big data”, gives what Talent Management’s Michael Custers calls a “multidimensional perspective”. I like this – because it involves the bringing together of all of these metrics, the analysis thereof, and the interpretation in a wider business context.
Harnessing this mass of data and putting it in a board-level context will not only put HR on the board, but it will give HR the opportunity to carve out influence, and prove its influence.
No more navel-gazing – more like excel-gazing.