A quick search on any of the main HR websites, blogs, or latest research reports will tell you that 2013 is predicted to be a year of change. Workforce trends are showing signs of a rebounding economy, marked by increasing external hiring rates, rising voluntary turnover rates, and declining productivity levels. These trends, coupled with reportedly lower levels of employee engagement, can be interpreted one of two ways – either HR has been served up a full plate of challenges, or HR has been given a fabulous opportunity to play a more strategic role in 2013. Being the ever eternal optimist, I choose the latter.
Understanding global workforce trends is a strategic imperative for any organization’s success, however, analyzing trends by industry, geographic location, or organization size can provide even more relevant comparisons. That being said, the reference point becomes moot if your organization does not currently have the capability to report on its own internal workforce trends. Being able to answer questions such as “are we hiring more, less, or equal to our industry peers?” or “are we losing employees in critical roles at a higher rate than other organizations?” can provide the necessary information senior leadership requires to determine if action is needed, and where to target strategic initiatives. If your organization cannot accurately analyze its workforce, then it’s nearly impossible to assess if you are doing better, worse, or similar to competitors in the external marketplace. This exact conundrum is the catalyst for Workforce Analytics (WFA).
Many organizations understand the value of WFA, however, do not know where to begin the analytics journey. The data is being captured (either in Peoplesoft, SAP, Employee Central, Workday, or even homegrown systems), yet the majority of organizations are not leveraging this vast information to drive decision-making. At the most basic level, we see organizations providing some regular reports (e.g., turnover, headcount, etc.), however, often there is a lack of data governance, standardized formulas, or insights being presented at the executive level. This translates to a low probability of strategic action. On the other end of the spectrum, advanced WFA programs often include an automated reporting process, Board-level reporting, ROI analyses, and an analytic research agenda aligned with corporate strategy. In addition, more sophisticated programs typically involve analyzing integrated data (core HRIS data with Financial, operational, and talent management data), which significantly augments the potential for analytic insights. The ability to provide answers to complex business questions and identify areas of opportunity for cost-savings is one of the key differentiators for strategic HR functions.
For those beginning the WFA journey, simpler is better, and technology can help in this respect. I am partial to the SuccessFactors Workforce Analytics & Planning solution (EPI-USE is a certified SuccessFactors partner), and being a former SuccessFactors employee and Infohrm client lends credibility to my backing. Implementing the SuccessFactors WFA application has numerous benefits, including global standards on workforce metrics, embedded external benchmarks, the ability to integrate data from any other system, and 30+ years of expertise in the field. In addition, complementing technology with strategic consulting to share best practices on effective program design, rollout strategy, and methods of ensuring adoption will increase time to ROI. If budget constraints do not allow technology to be an option, manually compiling reports from various systems may be time-consuming, but is still far more effective than making decisions based on gut feelings. Start small – a simple comparison of your organization’s internal trends compared to the external market can help identify where policies/programs may be hindering your ability to be competitive. Answer key questions that are top of mind for leadership, for example, is high performer turnover up or down? Paint a picture of your organization’s workforce profile as it stands today, in order to understand the potential impact external workforce trends may have on your ability to retain critical talent. If this undertaking is too daunting, consider leveraging one of EPI-USE’s WFA/P experts to share their lessons learned and guide your HR function’s strategic transformation.
Knowledge is power, and the HR function holds the key. Tapping into your organization’s data can yield powerful insights that drive action, and ultimately result in significant dollar savings. With a finite amount of resources, organization’s need to spend their precious workforce investment dollars wisely and every strategic decision should be based on fact. If becoming a more strategic HR function is on your organization’s 2013 strategic plan, then launching a WFA program should be step number 1.