HR Technology Column

Analytics! (Did I Just Scare You?)

Workforce analytics can seem scary and complicated, which must be two of the many reasons they have not been successfully used inside HR departments for decades. After many previous attempts by software vendors large and small, consultant Mercer may have come up with a winning combination of technology and consulting.

Monday, February 6, 2012
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Workforce analytics sometimes scare me. They seem so complicated.

Apparently, they make some HR executives nervous, too. In my 23 years in the industry -- aside from calls to become more strategic and to belly up to a particular piece of office furniture -- nothing has been more strongly urged upon HR departments and seemingly less frequently adopted.

Yes, I've long said it's the thing HR feels most guilty about not doing.

Some of the technology history is a story of frustration. Back in the '90s, before Oracle acquired PeopleSoft, both companies took completely opposite approaches for delivering workforce analytics to their customers.

PeopleSoft created a huge and largely unstructured module, whose power came at the cost of complexity for the end-user. The person in charge at the time, Don Chun (now a senior executive with Fidelity), admitted that about 25 PeopleSoft customers out of thousands in the installed base bought it. And maybe five implemented and tried to use it.

At Oracle, it was one of the favorite projects of Joel Summers, who created and ran all of Oracle HCM until retiring after the acquisition in 2004. His approach was to do it all for the end-user. He created little dashboard apps, which would automatically analyze and each deliver a single metric. And update the result every time the user refreshed the screen.

His other favorite project was enabling managers to do performance reviews "in an airplane," long before anyone could imagine being connected to the system through WiFi while flying. Every summer for three or four years in our full-day briefings, Joel would proudly show me new dashboard analytic apps.

Unfortunately, Oracle chose to sell them as a separate module (as it unbelievably still sells self-service today as part of on-premise EBS), and Joel sold only 10.

Over the years, there have been many standalone packages from smaller, non-ERP vendors, recently most notably from eThority (acquired by TALX) and start-up Visier, run by many former senior executives from Business Objects (now owned by SAP).

We've tried to do our part at the HR Technology® Conference. For the last five years at least, we have featured individual presentations and panel discussions on the subject, ranging from beginner to intermediate. And lately, a full track of sessions including the more advanced subjects of workforce planning and predictive analytics.

Though attendance at the sessions has been good, I'm not sure we've done any better than Don and Joel 15 years ago. Not to mention pioneer Jac Fitz-enz, who I know feels he's been howling into the wilderness for decades. But good for him, Jac hasn't given up trying.

So what's the problem?

Some say HR departments don't have the internal competencies to do analytics. Yet some years ago while moderating a panel for IHRIM, I asked who in the audience had been to business school (about a third) and who had taken a statistics course (naturally, the same). Clearly, the skills are there.

As I wrote at the top, workforce analytics just seems scary and complicated. Plus the absolute necessity of integrating data from other departments -- especially finance -- seems daunting. "Data warehouse" has never been HR's favorite term or concept.

I've long thought that an analytics software package should follow Joel's original vision (and he was a visionary) -- tell the user what to analyze and then analyze it for them more or less hands-free. Plus, add something Joel couldn't offer from a software company: some serious hand-holding, education and consulting along the way.

Enter Mercer's new offering called "iknow."

This is another Mercer product to bundle Human Capital data, Mercer's own intellectual capital, consulting services and technology (partnered or purchased). It follows Human Capital Connect, its shared offering with Peoplefluent for performance management.

The executive running iknow is Partner Brian Kelly, the former North American president for Infohrm, the workforce planning vendor SuccessFactors acquired less than two years ago. At the time, observers noted SuccessFactors had no experience managing a business that was half consulting and only half technology. Now Brian's with a firm that does.

Mercer privately previewed the product to analysts at last October's HR Technology®. If you want a more detailed report on its capabilities, read the blog from Yvette Cameron, who is quickly establishing herself as our best new analyst. The product is now public and generally available.

The technology piece is a mixture of Mercer's own stuff and the visualization and analytic functionality of MicroStrategies. The data extraction from every major HCM and talent management vendor (plus those other pesky systems) is proprietary to Mercer. The data model is also proprietary, as is the survey and benchmark data Mercer includes to varying degrees.

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Naturally, iknow is sold as a SaaS monthly subscription, priced in this case not just by company employee size but also the number of company systems to extract data from. Brian estimates that the 90-to-120-day implementations might range from $40,000 for a smaller company (around 5,000 employees) to as much as $150,000 for the most-complicated cases.

But implementation is where the heavy consulting and education begins and includes no fewer than 40 hours of Mercer consultants' time, apart from technical implementers. Companies get assessments of the current state of their workforce analytics and metrics and their readiness for them, working sessions making guided choices about initial metrics and rollout, and more planning than I care to describe or take part in.

All of it aimed not just at getting good numbers for the right things but how to make them useful in every corner of an organization. Remember that piece of office furniture?

A yearly subscription also involves no fewer than 40 hours of consulting, which like the implementation also focuses on how to make HR successful at integrating metrics into the entire organization, not just on tweaking the results themselves. That will cost from $5,000 to $25,000 a month, Brian says.

OK, hardly the cheapest way to bring these critical HR measurements into your organization. But it's the first program I've heard about that seems to hold out the promise to work. And maybe banish those nerves and guilt forever.

HR Technology Columnist Bill Kutik is co-chairman of the 15th Annual HR Technology® Conference & Exposition, returning to Chicago for one year, Oct. 8-11, 2012. Exceptional speaking proposals may still be accepted a month after deadline on the website. You can comment on this column at the Conference LinkedIn Group, which does not require prior or future conference attendance to join. He is also host of The Bill Kutik Radio Show®. He can be reached at  

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