What Can We learn from Leading Companies in People Analytics?
This year, Insight222 Research presents an analysis of "Leading Companies” in People Analytics for the first time. Using our proprietary methodology, we have segmented the findings of our Insight222 People Analytics Trends 2021 research by Leading Companies who are paving the way for the field of people analytics. In this blog, we share more about what makes those companies great, and what every people analytics team can learn from their work.
What makes a Leading Company in People Analytics?
Leading Companies are those companies or organisations that have demonstrated that they have a people analytics function that is considered a leader in the field. In these companies, analytics has enabled Human Resources to unlock value for employees and the business. As RJ Milnor, Head of People Analytics at Uber, describes it in ‘Excellence in People Analytics’, “people analytics drives the business forward and helps our employees continually excel and reach their full potential”.
At Insight222 we work with hundreds of global organisations and people analytics leaders frequently ask:
How do Leading Companies in people analytics deliver value to the business?
What roles do they have in their team?
How can I learn from them?
Indeed, Leading Companies such as Capital One and Microsoft actively share insights from their work to help other people analytics teams and HR leaders learn from their approaches and experiences. In Leading Companies, people analytics and insights are infused into the company’s operations and strategies, and externally they play a leading role in advancing the field.
In Insight222’s latest People Analytics Trends research – Accelerating People Analytics: A Data Driven Culture for HR – we highlight the particular attributes of Leading Companies that deliver business value to their organisation. A comparative analysis of Leading Companies reveals that they have a:
Greater investment in people analytics professionals than non-leading companies
Greater investment in people analytics technology than non-leading companies
Data driven culture for HR
How do Leading Companies invest in people analytics professionals?
In 2020, the Insight222 Operating Model for People Analytics was published – with a value chain guided by client drivers and resulting business outcomes at its core. Our research this year found that Leading Companies invest across all three engines of the People Analytics Operating Model.
One of the areas of the People Analytics Operating Model where we see the greatest difference in the investment by Leading companies compared to non-leading companies is in the Product Engine.
Leading Companies focus on building capability in consulting and influencing, product management and change management to a much greater extent. This shows their desire to make their solutions and predictions effective by making “analytical products” for employees, managers and executives as necessary, through embedding analytics into the people processes across the company.
For example, at Vertex Pharmaceuticals, the people analytics, data science and IT teams partnered to develop a high-quality custom skills model to match employees to open jobs. When comparing against external products in the market, they found their model to be more superior. The team have since deployed their custom job matching algorithm, as the first people analytics product, to help people navigate their career at Vertex. They are now expanding the use case to match people to career goals to generate career paths that help employees understand how they can reach their career destination.
How do Leading Companies invest in people analytics technology?
Leading Companies invest in people analytics technologies and adopt unique strategies to meet the needs of their organisation. Firstly, Leading Companies are investing not only in productisation capability, as noted above, but also in technology that supports productisation. This is not surprising, as 100% of Leading Companies report that they have primary responsibility for the productisation of analytics solutions.
A question that is top of mind for many people analytics leaders is ‘what is the first solution at scale I should deliver?’ According to Leading Companies, it is astute to start with insights at scale – getting the right data to the right people at the right time, by investing in Second Wave people analytics technology such as SaaS-based data democratisation systems (for example, Visier, Crunchr, One Model) or adopting a ‘build’ approach.
In an episode of the Digital HR Leaders Podcast, Jeremy Shapiro, Head of Workforce Analytics at Merck, explains that their first tranche of delivering insights at scale was, “getting the right data at the right time, using a tool like Visier to ensure that HR business partners and others can segment the data easily and simply and understand the story moments before walking in to a meeting”.
Leading Companies think strategically about their ‘build versus buy’ approach. It is common for Leading Companies to build their own solutions to match what is in the marketplace and supplement this by buying technology where necessary. Factors influencing this decision include resources, cost and quality. Another factor that Leading Companies consider is where do they want to differentiate? If they are working on something unique, keeping the product development in-house has many benefits, including the possibility of developing an entirely new product for the HR technology marketplace.
At IBM, former CHRO, Diane Gherson explains how they developed their own personalised ‘Your Learning’ system. Badges provide employees the ability to move into new roles with the skills they have developed. By connecting this to career, it shows what the hot skills are in IBM, where there is demand internally and where the market has demand. The team scrape job postings from their competitors to surface where demand is going in terms of skills and so employees can align their career and learning goals with where the market is going. It also helps employees understand that their current skills may not have traction in the market, which is also important to know and important to career discussions.
The product has enabled IBM to surface jobs inside of the organisation that match to an employee’s skills and has a better NPS score than most products in the marketplace! HR at IBM is now viewed as having become a truly digital organisation, and the HR team has moved from executing on the basics to helping talent become the competitive advantage in the market.
How do Leading Companies develop a data driven culture for HR?
One of the most important elements of delivering value through people analytics is having a data driven culture for HR. If HR professionals understand, use and make decisions using an evidence-based approach, then people analytics, as a function, will likely be more successful. HR executives and practitioners will frankly be more willing to receive and be expectant of the work that people analytics undertakes. At Capital One, Guru Sethupathy, formerly Head of People Strategy & Analytics and now Entrepreneur in Residence points to three focus areas that they continuously strive to improve:
Exporting talent from the people analytics team to build a data driven capability in HR
Driving a program of ongoing development in data literacy, focused on developing hypotheses and how to test those with data, and building a community of practice around it
Expectation setting from not only the CHRO, but all senior executives in HR that a data and digitally literate HR professional is the new talent profile of the future
Leading companies have all embarked on the multi-year journey to successfully develop a data driven culture for HR – and they continue to invest in developing the elements of this, which in turn enables them to scale people analytics and deliver even greater value to the business.
Simply providing data does not guarantee a data driven culture for HR. A commitment must be made to intentionally develop a culture over time; this is true for any culture, including a data driven culture for HR.
When asked what she has learnt whilst developing the culture at Microsoft over the last five years, Kathleen Hogan, Microsoft's Chief People Officer explains, “there is no single lever, that you have to pull many levers to drive the culture change and you have to stay at it”.
Final thoughts
The journeys taken by Leading Companies to develop world-class people analytics functions provide a bedrock of learning for aspiring organisations.
HR professionals often assume that Leading Companies in people analytics are technology companies. Our research identified Leading Companies across the Pharmaceutical and Healthcare, Retail & FMCG and Financial Services sectors in addition to those in the Technology Sector. This is testament to the fact that in any organisation, the Chief Executive Officer (CEO) and the CHRO subsequently need a much deeper understanding of their workforces than ever before - and in an evidence-based fashion. They turn to their people analytics leaders for the insights needed to manage these topics. At their most profound, the people analytics leader works alongside their CEO, helping them explain insights to employees and determine the most important course of action for the organisation.
Disclaimer:
The methodology for identifying “Leading Companies” is proprietary to Insight222 and the number of companies is not publicly disclosable for commercial reasons
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ABOUT THE AUTHOR
Naomi is currently the Director for Insight222's People Analytics Program®. This unique program develops the knowledge and skills of People Analytics leaders and their teams to increase value, impact and focus through bundled learning, networking and advisory solutions. Prior to joining Insight222, Naomi built out and led the People Analytics Consulting team at Barclays. She has also held roles in HR Business Partner teams and in Reward.