Workday vs. Cornerstone Evolving!
I already admitted how foolish it was to ignore Evolv for six years until Cornerstone OnDemand bought it for $42.3 million last fall. Now Cornerstone has started opening the kimono on its intentions for Evolv, which includes competing with its BFF Workday on machine intelligence, predictive analytics and "Insights."
By Bill Kutik
What would you have done if a company urged you to tell its great story about predicting the success of candidates wanting to become inbound call-center customer-service reps?
Yawn, right? Might you have said, "Problem is too easy," as I did? With call centers experiencing the highest employee-turnover rate in the world, and therefore constantly hiring, isn't a pulse, hearing and speaking sufficient for landing a CSR job?
The best way to assess those candidates seemed so obvious to me: Strap them into a headset and make them listen to people shouting and abusing them for eight hours (with two 12-minute breaks plus lunch) and see whether they survive and still want the job!
Well, mea culpa. At Cornerstone OnDemand's recent user conference, Convergence, I heard two of the most serious data scientists from its Evolv acquisition, explain where it's all going: right into the heart of the next great competition in HCM-predictive analytics for hiring, retention, training and managing employees, including those working in call centers.
Sorry, but the coming conflict calls up for me the final scene in the first Terminator movie: a pregnant Sarah Connor (carrying gestating software, actually) driving into the gathering storm in the Mexican mountains preparing to do battle with the machines. With that great music, of course-DUM, Dum, dum, DUM! (I watch it just to hear the closing music.)
While the battle between software vendors gathers, everybody seems to be calling its offering the same thing: "Insights." First HireVue, then its partner Workday, then its partner Cornerstone. OK, the Outlook online thesaurus offers nothing better, but aren't there print editions with more choices or marketing consultants specializing in naming who can lend a hand? Do they all have to select the same name?
As always, vendors are ahead of their customers, as they should be. Even though HR continues to be slow in adapting backward-facing workforce analytics, some companies are dying for hiring predictions.
In my experience, this is especially true at those organizations that need to distinguish between potential A- and A+ players, such as Bain and other high-level business consultancies, that rent out the brainpower of their young consultants at huge mark-ups; though, to be fair, no worse than at all big professional service companies-law firms, accounting firms and PR agencies.
The need for better hiring savvy trickles far downstream, all the way to retailers with their 150-percent turnover rates. Or to companies with 500 applicants for a single job (that still happens) that want to apply predictive analytics at the top of the funnel to all of them-or only to the final three at the neck.
Flight risk is huge now, with many corporate employees finally over their Recession fears and really sick of the two jobs they've been doing for one salary. We haven't seen job-opening and turnover rates at these levels in years-about 5.1 million openings and 2.7 million voluntary separations, according to a March Bureau of Labor Statistics report.
Vendors are taking different approaches to address these issues, but Cornerstone and Workday seem to be doing it pretty much the same way: using customers' anonymous network data, algorithms and machine learning. Each one bought a company of data scientists-Workday grabbed Identified-and each has recently released its first product: Workday Talent Insights in April and Cornerstone Select in May (with Cornerstone Insights coming in October).
HireVue (the subject of a future column because of a wildly different approach) actually grabbed the product name a year ago!
You may know in true software vendor fashion (cooperating while competing, known as co-opitition), Workday refers its customers to Cornerstone for an LMS (and less frequently to Saba). You may not know that as soon as Workday announces its own LMS, even a minimally viable product, Cornerstone will get tossed off the boat. In software, no BFF is ever for life. Cornerstone knows that will happen. No hard feelings.
So why not go toe-to-toe now on Predictive Analytics?
Each has started with a different one of the two major problems. Workday Talent Insights is tackling flight risk, while Cornerstone Selection is about ... well ... candidate selection. Each will do the other problem shortly.
Cornerstone's vice president of analytics, Max Simkoff, the former CEO of Evolv, had me at "hello" during his presentation when he admitted his software-the algorithms and predictive models developed over the last six years-deals in correlations, not causations, and that it offers only "probabilities, which can be wrong." Wow, truth in advertising and full disclosure. A great start.
Right now, Cornerstone is selling the old Evolv software, rebranded Cornerstone Selection, mostly in the call-center world, where it's been so successful, and in some high volume (a corporate euphemism for "high turnover") retail. It offers the familiar red, yellow, green light on hiring each candidate that Unicru (bought by Kronos) did in retail a dozen years ago.
But Selection also offers guidance on who will stay and how well they might perform. And it gets to those conclusions in a way that Unicru never could have imagined.
Scheduled for the October release, Cornerstone Insights promises to predict flight risk, based (for the moment) only on LMS data. There, Workday seems to have an edge, pulling from a much broader set of data. At the same time, many experts claim you can't make that call at all without outside data, such as a spouse taking a job across country (an action that can be revealed through social networks).
Max also said what we all know: "Of course, managers are the No. 1 cause of people leaving." Workday Talent Insights includes a manager's history of employee turnover in its data set for flight risk.
Analyst and researcher Josh Bersin, principal of Bersin by Deloitte, stepped on to the stage at Convergence to declare that business leaders could now take advantage of predictive analytics without implementing complex Big Data tools.
Analyst Holger Mueller of Constellation Research writes, "Cornerstone has made the right moves, putting data into Hadoop clusters [thus not requiring a data warehouse] and then running machine learning models on top of it. Doing 'model thrashing', i.e. running n models and choosing the ones with the best analytical value is equally the right approach versus a traditional single-model approach."
But, Mueller concludes, it all comes down to whether the models "really work" when applied across a variety of customers with very different data landscapes. And I think the customer success stories may not be coming fast.
DUM, Dum, dum, DUM!
HR Technology Columnist Bill Kutik is co-chair emeritus of the 18th Annual HR Technology ® Conference & Exposition, returning to Las Vegas, Oct. 18-21, 2015. You can comment on this column at the Conference LinkedIn Group, which doesn't require prior or future conference attendance to join. Listen to The Bill Kutik Radio Show ® for his provocative interviews with HR thought-leaders. After May 27 watch the fourth episode of his new video series, Firing Line with Bill Kutik™. He can be reached at firstname.lastname@example.org.