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Buying Workforce-Analytics Software

The need for HR leaders to make crucial decisions affecting their workforces has renewed the call for actionable workforce planning and analytics software. An expert from IDC reviews the situation.

This article accompanies Inventing the Future of HR.

Thursday, April 1, 2010
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Probably the most fiercely debated question in HR right now centers around analytics and workforce planning. It is being hotly debated because there is a sense that we've been talking about it for so long, yet so little real progress has been made.

Some even go so far as to say that it is the one true path to getting HR to that ever elusive "seat at the table." The technology is not new, the concepts are certainly not new, either. So why hasn't more progress been made?

Well, the topic is hot no doubt due, in part, to the difficult economic times.

One reason centers around the feeling that, in some cases, recent job actions were done without all of the requisite insight that could have better informed the process. Another is that the true cost of the workforce and factors associated with productivity are elusive to attain and are now more important than ever before.

The questions relate to HR's role in delivering on analytics and planning. Some assume that, because they haven't delivered, HR is not capable or lacks the analyst mind-set. The truth is that it is really difficult to do -- and nearly impossible if the top of the organization doesn't properly recognize the effort's merit.

It is my view that HR has done a pretty good job of offering information about the data over which it wields control. HR does not own, nor does it have control over, operational data that -- together with HR data -- offers that Holy Grail of real insight.

Enter the debate over whether to build or buy.

In the case of analytics and planning, the task at hand encompasses melding both the HR/talent information with the other operational data and, until recently, few off-the-shelf options existed. In truth, even those products that do exist, while quite good, mostly involve a heavy dose of up-front consulting and customization.

Consulting comes in because every organization has data in a variety of places, and no two organizations have the exact same expectation for what they deem essential in terms of what is key information to track. So, faced with the costs for having someone else to do the work or whether to undertake it alone, some organizations have seen it as a wash.

But, as offerings from the likes of Inform (recently acquired by SuccessFactors), Vemo and Aruspex (to name a few) become more mainstream, HR ought to look more closely at the choice to buy as these and other firms will bring the benefit of experience to the process.

If the decision is to look for outside assistance, HR executives should do some up-front homework first. It's best to think about it as though you were going to build it in-house. Foremost among the needed pre-work is having a good understanding of the metrics you're looking to deliver or in the case of planning, determine the positions for which you want to plan. You might not want to plan for all positions in a first phase. 

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Then, it makes sense to inventory the various sources of internal data from which the tool will draw to build metrics or plans. All of this information will help you build either a request for information or a set of scripts with which to use to assess vendor tools.

Knowing the various sources of data will allow you to gauge vendor experience with client environments similar to yours. It is also imperative to talk to vendor references -- but instead of leaving it as a final step, I advocate that this happen much earlier in the process. Other companies may have been down similar paths already and will likely be able to inform your process and enable the organization to achieve success.

This experience will benefit HR leaders in that they will be able to tap this asset to shorten the time to deliver on the promise of actionable information. 

Lisa Rowan is IDC's program director for HR and talent management services research. In this role, she provides expert analysis focused on both the business services addressing HR and talent-related process issues, such as human resource consulting, processing services, and business-process outsourcing services; and HR IT Services, such as systems integration and IT consulting. 

See also:

HROM's Apps

To Build or Buy

Redefining the Meaning of Culture

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