How HR can raise its strategic voice

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Overview


There’s never been a better time to be an HR leader. At most organisations, HR leaders have gained a strategic voice on what needs to be done from a talent perspective to drive business growth and success, and business leaders are eager to gain this insight. But HR’s strategic voice is heard, and impacts the business, only in fits and starts.

The C-suite may seek guidance from HR on something big, like a workforce restructuring following an acquisition, and what results is a fire drill of pulling together current and historical data to deliver insight on how to move forward. Yet rarely is that process replicable—it was a one-time shot that was calculated on spreadsheets and delivered in presentation slides. 

Even the strongest HR leaders hit limits to their strategic voice if it takes them a month or two of research to provide guidance. To elevate their voices and impact the business, they need continuous access to great data and the ability to equip managers with decision-making tools throughout the year.

Identify meaningful metrics

HR and business leaders must have ready access to organisational metrics to answer any number of questions about the workforce in order to measure against goals. Say one goal is to improve the company’s declining retention rate, particularly among high performers. Maybe the problem is one of boredom if retention-risk employees aren’t provided with new opportunities? One metric might be measuring internal movement rate to assess its impact on employee retention. For instance, you might want to know the ratio of workers who stayed with the company longer than two years following a new job opportunity in another division.

Yet to make these metrics meaningful, they have to be based on common definitions that everyone shares. Say, for example, your metrics indicate retention rates improve if top performers are given the opportunity to move to new jobs across the organisation every few years or so. A manager is notified that the internal movement rate for his team is just 5%, and he’s fallen short of the 10% goal established for his organisation. The manager is convinced this information is wrong, because based on his own analysis he’s done in a spreadsheet, the rate is 20%. So who’s right? 

That’s hard to say, if the company doesn’t have a shared definition of ‘internal movement rate’. HR may be counting only moves that reflect a promotion or career advancement, while the manager is counting all moves, including low performers that struggled to meet goals - and applied for and were hired in other roles. Coming up with shared definitions is a job HR must tackle and lead.

Tell a story with data

Having meaningful metrics using common definitions only gets you part of the way there. You have to surround HR data with business data and then connect the dots. In other words, you have to be able to tell a story with it. What is the impact of a low internal movement rate, and how bad is it? Does the company need to take steps to improve its support of internal movement? 

If HR leaders can excel at telling data-backed stories, then they can take their strategic voice up to the next level by moving into a predictive—and even prescriptive—mind set. Imagine this - an HR leader can identify high performers that may be at risk of leaving the company based on historical data and patterns, and make a recommendation about how to retain those people.

To achieve these goals, there needs to be some fundamentals in place. That includes an HR technology system designed to support and deliver analytics to both HR and business leaders, so they can gain insight into the cost, capacity, capability, and quality of their people in the context of daily decision making.

This is only possible when HR and all relevant data—and the actual analytic capabilities themselves—are contained within the core system. The need to move data into separate business intelligence or workforce planning systems with the assistance of IT departments should no longer be required, if an organisation is using a truly modern core HR system that utilises the latest innovations.

Top executives also need to understand the power of workforce data, and how it can provide a competitive edge. With that support, HR can start the work of providing guidance based on facts and analysis rather than assumptions, and truly become the voice of leadership.


 

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