Measuring Human Resources by Maya Droeschler 2014

MEASURING HUMAN RESOURCES
GUEST SPEECH BY MAYA DRØSCHLER
University of Southern Denmark
October 2014

MEASURING HUMAN RESOURCES - MAYA DRØSCHLER 2014
INTRODUCTION
• There’s no future for HR without strategic & analytical
capabilities

INTRODUCTION
• Finding the missing link(s) between
• HR strategy and HR practices
• Workforce response to HR practices
• Overall organizational performance
• The ultimate competitive advantage

INTRODUCTION
• We have to learn to:
• ask questions
• form hypotheses

INTRODUCTION

INTRODUCTION
University of Copenhagen
(not that impressive looking, I dare
say)
HR experience from large and
small organizations

INTRODUCTION
• A seat at the table:
• HRM is not about people…..
• It’s about business!

INTRODUCTION
‘The prerequisite for measuring HR activities
is that HR understands the business. It
doesn’t make sense to measure something
which is not linked to business strategy &
objectives.’
Steen Wung-Sung, Head of HR Intelligence and Platforms, Tryg

INTRODUCTION
Analytical
Transformational
HR
Strategic Commercial

AGENDA
• The basics – HR metrics
• Business problems
• Data and intuition
• Going from transactional to transformational
• Sociometric data and HR Analytics
• Case: performance management
• Am I the CFO now?

THE BASICS – HR METRICS

THE BASICS - HR METRICS
• TURNOVER RATE
• Number of seperations / average number of employees x 100
Compensationforce.com 2013

THE BASICS - HR METRICS
• REVENUE PER EMPLOYEE
• Company revenue / number of employees
Forbes.com 2013

• HR TO STAFF RATIO
• Number of employees / Human Resources employees
HR Daily Advisor 2013

• Promotion ratio
• Employee absence rate
• Average employee age
• Recruiting metrics
• And so on….

BUSINESS PROBLEMS

BUSINESS PROBLEMS
• Is our boldest ambition to:
• Prove our worth
• Document our contribution
• Go from cost center to profit center
INSIDE-OUT?
• Or is it to build a successful business in collaboration with
managers, employees, and other stakeholders?
OUTSIDE-IN!

BUSINESS PROBLEMS
• Bad marketing performance = business problem
• Bad sales performance = business problem
• Bad financial performance = business problem
• Bad HR performance = HR problem?

BUSINESS PROBLEMS
• BUSINESS PROBLEM:
• Does your marketing campaign work?
• Are you able to attract customers to your store?
• BUSINESS PROBLEM:
• Do you get return on investment from your talent management
program?
• Are you able to attract talent in the first place?

BUSINESS PROBLEMS
• We can measure:
• The how
• The what
• The when
• The who
• But the most important thing is:
• The why
CORRELATION IS NOT CAUSALITY

BUSINESS PROBLEMS
• If you don’t know the why

DATA AND INTUITION

DATA AND INTUITION
• We need data – not just semi-data, but REAL data
• We need context data

DATA AND INTUITION
• Opinions (semi-data) are also important, becuase they tell
us something about how people experience reality.
• Have crime rates really gone up?

DATA AND INTUITION
‘HR is a culture of intuition’
@david_green_uk (a most follow on Twitter, BTW)

FROM TRANSACTIONAL TO
TRANSFORMATIONAL

TRANSFORMATIONAL
• The police actually measure our speed – they don’t just
feel that we are speeding (if we are)
Will speeding ticket profits go
down when we all have
driverless cars?
Will the HR profit center close
when robots take over the
workforce?

TRANSFORMATIONAL
• What is the most important outcome?
• Where is the value?
• Someone gets caught speeding
• The ticket is handed over
• The financial transaction, the ticket is paid
• The police prove their worth
• The speeding person changes his or hers behavior and society
becomes a more safe place

TRANSFORMATIONAL
• The value is in the answers to the questions:
• What is the value of a more safe society?
• What is the value of a performance driven culture?
• What is the value of great management practices?

TRANSFORMATIONAL
Slide courtsey of Luk Smeyers, iNostix

SOCIOMETRIC DATA AND HR
ANALYTICS

SOCIOMETRIC DATA AND HR
ANALYTICS
• Sandy Pentland to Harvard Business Review: We all have
an intuition about it. But because we can measure it,
social intuition is no longer magic; it’s now quantitative
science.
The study: Sandy Pentland outfitted executives at a party
with devices that recorded data on their social signals—
tone of voice, gesticulation, proximity to others, and more.
Five days later the same executives presented business
plans to a panel of judges in a contest. Without reading or
hearing the pitches, Pentland correctly forecast the
winners, using only data collected at the party.

METRICS VS. ANALYTICS
HR Metrics Predictive HR Analytics
1. Tangible (hard data) 1. Intangible (likelihood)
2. Accounting (100 % correctness) 2. Probability (never 100%)
3. Backward-looking 3. Forward-looking
4. Data 4. Insights
5. Comprehensive 5. Selective
6. Transactional 6. Strategic
7. Information 7. Transformation
8. Low addition of value 8. Differentiator
9. Tracking 9. Asking questions
10. Reporting 10. Predicting
11. Silo HR 11. Business critical
12. HR ownership 12. Management ownership
13. Controlling 13. Optimization
14. Inside-in perspective 14. Outside-in perspective
15. Slicing-and-Dicing 15. Statistical Forecasting
16. Metrics 16. Patterns
17. Ratio’s (fraction) 17. Models (mathematical algorithm)

From the iNostix
blog
www.inostix.com

• Is Workforce Analytics the ultimate answer to the question
How does HR add value to the business?
• - It is in any case part of the answer

CASE: PERFORMANCE MGT

• Uniform and consistent data
• Comparisons across teams
• Identifying the most severe obstacles to business strategy
execution and success
• Closing skills gaps

Information Analysis Interpretation Action

AM I THE CFO NOW?
• Has the king of metrics found his queen?

AM I THE CFO NOW?
• You can meet me on:
• LinkedIn
• Twitter (@MayaDroeschler)
• Google+ (+MayaDrøschler)
• http://hr-forretning.blogspot.dk/
• http://hrcaseforum.dk/

Measuring Human Resources by Maya Droeschler 2014

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