How a New Operating Model for People Analytics will help Deliver Value at Scale
People analytics is fast becoming one of the most important areas of Human Resources (HR). Yet, people analytics functions too often fall into the trap of primarily offering ‘white glove’ treatment to a handful of – often very senior – business executives. This makes it difficult to deliver tangible business value at scale.
In almost every people analytics organisation we work with, we have come across three themes repeatedly that reflect this challenge:
How can I improve my impact? Organisations that build solid, business-oriented foundations - and don’t focus solely into solving technology and data issues – create more impact for their organisation on a long-term basis.
How can I create more value? Leaders and practitioners who regularly focus on the activity of analytics will create value both for the business and the employees themselves.
What should I focus on? Practitioners who focus on business challenges linked to the people strategy of the company are more successful in their endeavours.
To answer these questions, people analytics functions of all ages and sizes should focus on delivering business value to a far broader range of stakeholders, from executives to managers and across the entire workforce when necessary. To do this, teams should prioritise projects that focus on business challenges and productise services alongside adopting a service-centric delivery model.
Speaking about her approach to scaling people analytics Dawn Klinghoffer, Head of People Analytics at Microsoft, explains in a recent conversation for Jonathan Ferrar and David Green’s forthcoming book:
“In its simplest form, people analytics requires good data, solid analyses and effective processes. But to really make a difference to employees and the business, people analytics must be scaled. Like most things, the value of analytics is limited unless people – employees, managers and executives – actually use it.”1
As revealed by our newly published research, people analytics functions – much like the one at Microsoft - are increasingly delivering more business value by focusing on business areas over HR areas (see Figure 1). In turn, they structure themselves to focus on business challenges.
Delivering Value at Scale: A New Operating Model for People Analytics
At Insight222, we conducted research between March and July 2020 to understand how HR was responding to the COVID-19 pandemic and economic uncertainty. The quantitative analysis includes data from 60 global organisations, which are collectively responsible for almost five million employees, operating in over 150 countries.
Drawing on the insights from this research, as well as our experience working with leading people analytics organisations over the last decade, we present the Insight222 Operating Model for People Analytics, which is focused on business challenges – not just HR challenges – and scaling practical analytics solutions across the enterprise.
This new operating model is essential to Chief Human Resources Officers (CHROs) and business executives who want to use people data to deliver value to their businesses. Our key findings are:
1. People analytics is growing
Of the companies surveyed, 55% indicate that their people analytics team has grown in size in absolute terms over the last 12 months - and 60% of companies surveyed intend to grow their people analytics team with new experts relative to the rest of HR in the coming 18-24 months.
2. Analytics technology investment is increasing
54% of companies surveyed expect their people analytics technology investment to increase in the next 18-24 months. Furthermore, more than 80% of companies surveyed are using (37%) or planning to use (44%) advanced people analytics technology to conduct projects, in what we call a ‘Third Wave’ of more specialised analytics technology adoption.
3. Advanced People Analytics teams are evolving to focus on business challenges
More than half (52%) of companies surveyed expect to increase the number of internal analytics consultants, and almost two-thirds (57%) expect to increase the number of data scientists – but only around a quarter (28%) expect to increase the number of dashboard developers. This shift in role allocations allows HR to focus on business-relevant people analytics projects with a more complex scientific approach.
A new value driven approach to People Analytics
These findings are clear evidence that companies are investing in People Analytics and teams are growing, even in – or possibly in response to – the complex business environment of 2020. The question remains, how best to utilise the investment?
Our research supports a new way of operating for People Analytics, focused on business demand, value and outcomes. We refer to this as the People Analytics Value Chain (see Figure 2), which starts with client drivers as inputs and ends with analytics products delivering business outcomes at scale.
The value chain can be operationalised through the Insight222 Operating Model for People Analytics, which delivers value at scale through three engines (see Figure 3):
A Demand Engine – of consultants to work directly with business executives to provide a funnel of the most important business (not just HR) challenges and opportunities
A Solution Engine – of expert analysts, data scientists, behavioural scientists and stewards to deliver insights and recommendations
A Product Engine – of designers, product engineers and change managers to build and implement valuable analytics products at scale
We believe that people analytics has the power to unleash more value from the workforce and drive tangible business impact for the organisation. The new Operating Model for People Analytics presented here will enable that to happen.
Clients of the Insight222 People Analytics Program® can access additional survey findings in the Program Resource Hub here.
ABOUT THE AUTHORS
Jonathan Ferrar is the Chief Executive Officer of Insight222. He is a globally recognised speaker, author and business adviser in HR strategy and people analytics. Jonathan has worked in corporate business for over 25 years for companies like Andersen Consulting (now Accenture) and IBM. Contact Jonathan at jonathan.ferrar@insight222.com
Caroline Styr is Research Director at Insight222. She is an accomplished researcher, author and speaker on people analytics and the future of HR. Before joining Insight222 in July 2020, Caroline worked at Cognizant’s Center for the Future of Work. Contact Caroline at caroline.styr@insight222.com
Anastasia Ktena is Consulting Program Manager at Insight222 with experience in people analytics transformation, customer experience and communications. Before joining Insight222, she worked as a Senior Advisor for Gartner TalentNeuron. Contact Anastasia at anastasia.ktena@insight222.com
ABOUT Insight222
Insight222 Research provides business executives and HR leaders with insights and recommendations to advance the HR profession to become more digital and evidence-based. We investigate the most pressing challenges and latest developments in People Analytics and Digital HR. Through partnerships with leading practitioners, academics and thought leaders, we bring new ideas, pragmatic frameworks and structured guidance.
Insight222 is a global services and solutions company that enables organisations to deliver business value through People Analytics and Digital HR. The team at Insight222 provide consulting, learning and networking services to Chief Human Resources Officers and their key staff in Analytics, Strategy, Planning, Employee Experience and Digital HR. Insight222 clients and partners include some of the world’s leading brands - typically large, multinational organisations
Find out more at www.insight222.com and www.myHRfuture.com.
References
1 Ferrar, J. & Green, D., Expected 2021. Excellence in People Analytics: How to use workforce data to create business value. 1st ed. London: Kogan Page