If you want to know where HR is going, follow the data
In my last article, I related the tall tale of how I discovered Big Data in HR many years ago in ancient Mesopotamia. By leveraging the North Star as a major reference point. Determining how big data can be used to find patterns of data and make predictions about the future. How it can be used to prescribe the best ways to get the best results from our decisions and strategies
Managing data used to simpler, easier to handle. There were a few sources and finding the right data wasn’t a problem. But as the millenniums moved on and technology evolved, we now have the challenge of having too much data that is harder to handle. And the problem will get worse as new applications and sources of data emerge every day.
Although it would be nice to get a handle on all of it (if that were possible), it’s more important to get a handle on a subset of critical data that’s most critical to your success. Just like leaders should focus on critical impact positions, #HR should focus on the critical impact data used to support your strategy and what is expected by your key clients.
One of those key clients is your CFO. In my conversations with HR leaders, their biggest fear is that the numbers won’t add up in the face of questions from their finance and accounting departments. The reasons are many; can’t get information out of your system, disparate systems do not connect with each other, un-uniform practices, processes results in garbage into the system leading to garbage coming out, can’t access historical data, can’t generate reports, etc.
Why a Tough CFO Can Be Your Best Friend?
But without a strong handle on data, HR leaders are doomed to failure. This can make interacting with your CFO a very scary proposition. But in reality, working for a tough CFO can be a godsend.
Earlier in my career when I started working at a lighting manufacturing and distribution company, I met a person, the plant controller, who would dramatically change my view of what it takes to be a HR leader. He taught me quite painfully at first that the key role of HR is to help the company make money. That this required a rigorous use of data to make a strong business case for any HR spend. We got into many intense arguments; when I would talk HR and he would talk business. Overtime I realized that no sales means no business means no HR function
Many of the CHROs that I coach cringe at the thought of working with their CFOs. They share stories of being blindsided in discussions when the data they presented was wrong, insufficient or did not make a strong business case. It only takes one maybe two of these instances before they decide to fix the problem or avoid future meetings.
Obvious the former decision, getting a handle on your data, is the best choice. But it may require an inordinate amount of time, effort as well as capabilities that your team doesn’t have. A difficult choice in times of budget and headcount restraints.
In God We trust – All Others Must Bring Data – W. Edward Deming
But with the pervasiveness of data in every other function, including marketing, the expectations are growing that the #CHRO and their team will provide the numbers to back up their strategy. And if the ultimate goal of data is to enable better decision-making, then data that shows us the cause and effect of HR programs is critical.
In response, many CHROs have beefed up their HRIS teams and their reporting capabilities. But as the demand for information has increased, many of these teams have turned into bottlenecks as the time to get information increases. As new sources of information come online, exponentially increasing the amount of data, will these teams ever be able to keep up?
I’m in HR Because I Like
This evolution in data and how it can be used is driving an evolution in the HR practitioner. That was one of the key findings from the #CHREATE project on the future of HR. No longer can the HR Business Partner depend on #HRIS or other resources to provide the information; they must learn to get their own handle on data and provide it to their clients. This evolution will be made easier as more sophisticated but easier to use analytics tools come online. But it requires a new mindset of I’m responsible for my data, not someone else.
The new HR mantra changes from “I’m in HR Because I Like People” to “I’m Staying in HR Because I Like Data”
As this chart illustrates, there’s a direct correlation between the availability of key #data and the effectiveness of HR programs. Why?
Because the more data you have that can show the cause and effect of your decisions and programs on talent, profitability, the better you can tweak your strategy, modify your programs to achieve the desired results. Moving from guess work to analysis to improve HR performance.