WHY HR NEEDS ACTIONABLE ANALYTICS

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By Mary Hayes Weier

A poor economy forced many organizations to make the tough decision to lay off employees in the past few years, and even harder decisions about which ones to let go. Some beleaguered companies resorted to two or three workforce reductions a year. Long past the point of “trimming the fat,” every additional layoff decision felt like cutting into bone.

Yet there’s plenty of evidence indicating many HR and business managers didn’t have the right BI tools to make the best decisions about whom to let go to limit impact on current operations, while retaining or even hiring new talent that would best support often required changes in business strategies.

In other words, they didn’t have actionable analytics.

In a survey of 259 managers conducted in 2009 by HR consulting firm Knowledge Infusion, 45 percent of respondents said they didn’t have the necessary workforce data—including skills, performance, and compensation—readily available to make immediate workforce decisions, such as who to lay off to meet budget requirements.

Hard data like employee compensation exists, of course, and knowledge about performance and skills should appear on performance reviews. The problem is that managers can’t easily get to and combine such data in meaningful ways.

Even as organizations know this must change, there are roadblocks to immediate improvement. While 31 percent of survey respondents said they were in the process of improving production of delivery of HR-related metrics and analytics for HR data, half of respondents said it was a future project, to take place over the coming months or even years.

“Companies are still very challenged by the lack of actionable metrics,” says Jason Corsello, VP of KI OnDemand at Knowledge Infusion. “In the last few years, a company that had to cut 10 percent of its workforce may have not known where to make those cuts because it didn’t have that data available. And now, looking at the macroeconomic conditions of growth, they may not have the ability to leverage talent data to support a return to growth.”

An organization may know its performance for employee retention, based on metrics for voluntary staff turnover, or its performance for recruiting, based on the time it takes to fill new positions. The problem, Corsello says, is “there’s not a lot of action going on with these insights.”