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Max Blumberg: How can #PeopleAnalytics prevent incidents like the Twitter firings?
- 1. All content remains the property of Blumberg Partnership Ltd and may only be used with prior written consent How can #PeopleAnalytics avoid incidents like the Twitter firings? www.maxb.com max1@maxb.com
- 2. WORK • Accenture • Technology start-up • People Analytics Consultant & Advisor • Coach ACADEMIC • Computer Science • Chartered Psychologist • Maths & Stats • PhD (University of London) • Visiting Professor, University of Leeds Business School • Associate Researcher, University of Southern California Max Blumberg
- 3. When do executives like Elon lay people off? 3 So it’s all about value. But what is “value”? Executives like Elon lay off employees when... It’s clear that employees’ net value is negative Or it’s not clear that their net value is positive Or their work can be done more cheaply in some other way Or their role(s) no longer adds net value They think they won’t miss them Employee net value = Employee value added – Employee cost At what point do you fire… A waiter? A firefighter? A Prime Minister or President? A marketing employee? An HR team? A People Analytics function? A workforce?
- 4. What is value? Your ET’s view of your organization 4 Investor Capital Tangible assets Intellectual capital Customers Human Data Social capital Financial capital
- 5. CEO’s like Elon are nervous 5 Send prediction of company’s expected return on shareholder investments to financial analysts If their prediction is wrong: Shareholders withdraw investments Cash flow reduces Some resources must be liquidated For their prediction to be right, they must: Ensure that the average return on all resource investments is close to the prediction Predict which resources are not likely not to provide the right return and either fix them or dispose of them Wall Street, NY; The City, London; CBD, Singapore; Paradeplatz, Switzerland; Central in Hong Kong; The Chicago Loop; Marunouchi, Tokyo; Bankenviertel, Frankfurt
- 6. How executives turn resources into shareholder ROI Shareholders invest in your organization ET creates a strategic plan which uses these investments to generate returns for shareholders by achieving a set of desired business outcomes • Vision, Mission, Objectives • Formulate corporate, BU & functional strategie Invest in resources to implement strategy • Tangible • Intellectual Capital • Financial Invest in strategic capabilities to unlock those resources • Innovation • Productivity • Customer growth • Quality BUs & functions implement strategies ET adjusts underperforming resources and strategic capabilities Organization hopefully generates profit (value) a portion of which returns to investors 6
- 7. How People Analytics can turn people processes into desired business outcomes RECRUITMENT LEARNING & DEVELOPMENT CAREER DEVELOPMENT REWARD & RECOGNITION SUCCESSION PLANNING COMPETENCY MANAGEMENT CHANGE MANAGENT WORKFORCE PLANNING WORKPLACE DESIGN KNOWLEDGE MANAGEMENT HUMAN CAPITAL INFRASTRUCTURE EMPLOYEE RELATIONS EMPLOYEE ENGAGEMENT WORKFORCE PERFORMANCE HUMAN CAPITAL EFFICIENCY TALENT MANAGEMENT WORKFORCE ADAPTABILITY WORKFORCE AGILITY CULTURAL ALIGNMENT LEADERSHIP CAPABILITY PRODUCTIVITY QUALITY INNOVATION CUSTOMERS PEOPLE PROCESSES LEVEL 4 WORKFORCE CAPABILITIES LEVEL 3 STRATEGIC CAPABILITIES LEVEL 2 BUSINESS OUTCOMES LEVEL 1 HUMAN CAPITAL STRATEGY PERFORMANCE APPRAISAL REVENUE GROWTH ROIC TOTAL RETURN TO SHAREHOLDERS CAPITAL EFFICIENCY FUTURE VALUE SUSTAINABILITY SOCIAL IMPACT DIVERSITY & INCLUSION TALENT PROCESSES WORKFORCE PROCESSES
- 8. Why does the ET fund People Analytics? 8 They pay you to ensure the workforce capabilities that deliver shareholder ROI If PA doesn’t do this, the ET’s own jobs would be more secure giving the PA budget to a function that does demonstrate shareholder ROI So what must your People Analytics function do to justify its continued existence?
- 9. You need to execute the following strategic people analytics to justify your continued budget and existence 9 1. Let executives know what your People Analytics function can do Reduce your chances of being removed by letting everyone know how you can contribute to shareholder returns 2. Research your company’s business problems Interview executives to find out where your company’s strategic and workforce capability problems lie 3. Generate hypotheses Ask which aspects of your people processes might be causing the above problems 4. Collect & generate people process data Collect data about problematic people processes to test your hypotheses 5. Quantitative analysis: Build statistical models to test your hypotheses 6. Implement your findings Update your people processes using hypotheses proved correct by the model
- 10. 1. Let your executives and operations people know what People Analytics can do 10 4. For example, we can test the impact of workforce changes on paper before you impulsively implement untested ideas (like firing half your workforce, reducing everyone’s pay or putting beds in the office) 3. Instead, our People Analytics function is about proactively building you a great workforce with the capabilities you need to execute your business strategy. 2. Hence we don’t just do reactive data-related work like reporting, dashboards and visualizations 1.We are not just a reactive data-led function like IT & MIS; People Analytics is strategy-led.
- 11. 2. Research the business problems with your ET 11 Learn as much as you can about your company’s objectives, business strategy, strategic capabilities, workforce capabilities, and people processes Ask about business outcomes What are our organizational objectives? Which issues do we face meeting our organizational objectives? Ask about Strategic Capabilities What strategic capabilities do we need to achieve our objectives and support our business strategy? What issues do we fact with our strategic capabilities including productivity, innovation, customer growth & quality, and how do these impact achieving our objectives? Ask about Workforce Capabilities: What workforce capabilities do we need to support our strategic capabilities? What issues do we face with our workforce capabilities and how do these issues impact our workforce capabilities? Ask about People Processes What issues do we face with our people processes that limit our workforce capabilities? Your ET may be too far removed to answer this but it’s worth a try
- 12. 3. Generate hypotheses Example: Value Profiler 12
- 13. Example of a Value Profiler Output Training Reward Career Team interaction Org struct Recruit Induction Low High Medium Priority High Priority Low Priority Targeted, Incremental, Improvements Only High Low Process Effectiveness Sales process Process Importance 13
- 14. Example: Service Profit Chain 14 Harvard Business Review, 2008
- 15. Example: Salesforce Profiler 15 Blumberg, 2011 Processes & Levers KPDs Salesforce capabilities $
- 16. 4. Generate data to test your hypotheses 16 The data required to test hypotheses about the effectiveness of your people processes seldom exists in any of your systems If anywhere, it is most likely to be in your climate/engagement surveys Chances are that you’ll need to generate the data you need through employee listening and surveys
- 17. 5. Perform quantitative analysis Build statistical Model 17 Regression Machine learning Multilevel Modelling Combinations of the above
- 18. 6. Implement Update your people process using hypotheses proved correct by the model 18 Examples: Competency management: Identify the competencies required for high performance and productivity Recruitment: Identify the personality traits required for agility and innovation Career development: Identify the career paths required for retention and quality
- 19. Implementation of analytics results: Recruitment example 19
- 20. Thank you! Questions? ☺
- 21. Appendix
- 22. What is People Analytics? 22 People Analytics is the practice of using…. Evidence-based methods (quantitative & qualitative) to… Design people processes that… Create the workforce capabilities required to… Enable the organization’s strategic capabilities That generate the organization's desired business outcomes People Processes Workforce Capabilities Strategic Capabilities Business Outcomes
- 23. What is not People Analytics? 23 Ask yourself: If our People Analytics function disappeared tomorrow, what would our organization miss most? • While you’re at it, ask yourself: If I disappeared tomorrow, what would our organization miss most?
- 24. What is not People Analytics? 24 People Analytics … is not a reporting or data mining function What can your PA function do that MIS can’t do? Would you really be missed if you stopped reporting, dashboards & visualizations? is not a quantitative-data-only function: Qualitative skills are crucial for understanding your ET and your culture does not workforce capabilities that may or may not be linked to strategic capabilities If they’re not linked to strategic capabilities, they’re useless is not an employee listening or ONA function Employee listening is a data source & ONA is a model: they are useless if unconnected to strategic capabilities