People Analytics offers real potential but it demands new rigour in data gathering and a connection by the HR function to the data in business processes.
People Analytics has its moment in the sun with most consultants and many organisations exploring the possibilities and potential of people data for organisations. We have been led by organisations like Google that have shown the opportunity for data on human performance and relationships to be a foundation of better realising the potential of people.
Do You Really Have People Data?
One of the consequences of the historical approach to human resources is that people data is often siloed and not integrated into management processes in the organisation. The lack of integration to the every day work of the organisation means that data is not captured and checked for accuracy in the every day course of work. Data that goes through critical processes will be kept in a level of accuracy through use. Data that is viewed as separate and secondary rarely has the same attention.
In organisations, remuneration information for individuals is the most accurate. That information is managed through strict performance processes and it checked by both the employee and the organisation on a regular basis to ensure the right money is being paid for work.
As we move out from this data, the quality of our information traditionally declines. Maintaining role information is often delegated and not tied to business processes that provide checks. The business can often see people processes as a constraint on their flexibility so people operate in ways unrelated to their position or role as described in people systems. There is little or any consequence for this until a restructure or other significant change highlights the inaccuracy of people data. Personal data like employee skills, qualifications and potential is often poorly captured or rarely updated. Relationship data might exist for customer-employee relationships but it is rarely recorded anywhere else other than in dated hierarchy charts. There is a good chance your finance hierarchy is different and more accurate than the hierarchy shown in your people systems. These types of data are no accurate because there is simply no business need to recognise this in systems in most organisations. Managers know this data and use it but don’t have an obligation to record it. We can contrast compliance learning where there usually has been historical rigour in gathering people data, again because of consistent business processes and the need for external audit by regulators.
Performance data is another source of challenge. Most people systems capture performance data as required for scorecards, but not the rich data on the actual work that individuals have done. There will be a difference and it is the first source of value of most people analytics approaches. Connecting these systems to record the richness individual performance in real time matters too.
The first challenge that organisations experience when they start to work with People analytics is that they have lots of data but none of it is accurate. Early efforts at analysis are stuck dealing with ‘garbage in, garbage out’. There’s no surprise that many of the leaders of people analytics have been startups or other digital organisations. They have built their management processes with an integrated approach to people data and have integrity of data as a result.
A New Start
Start by gathering the rich people data that the business uses but doesn’t record in people systems. Create incentives for people to maintain their own data because it will contribute to their performance and their potential in the organisation. Connect people data into business processes that provide checks and balances to maintain accuracy and currency. Ensure that people processes are streamlining and supporting business agility not holding it back. Capture the other forms of people data that you have been missing, especially relationship data. These foundations need to be in place before any organisation tackles the journey of leveraging people analytics.