People Analytics will benefit from adopting Digital Marketing best practices. Our three recommendations in this post are derived from our exposure to both People Analytics and Digital Marketing use cases. They should serve as food for thought and we would love to receive your feedback.
Lesson #1: Show me the money
When I think of People Analytics vs. Digital Marketing, one of the most profound differences is the mindset of the people involved. The analogy, which comes to mind, is that of rapper and a violinist in an orchester.
Digital Marketers iterate until they hit gold
Similar to a rapper, which continuously iterates, freestyles and improves, the digital marketer sees his job of continuously running small projects in order to drive up performance in Euros.
Typically, a data-driven marketer will start by showing the status quo in hard numbers. He then outlines the lowest hanging fruits by estimated impact in Euro, tests the proposed actions with a selected part of his portfolio, learns, and interates until successfully.
Most important a digital marketer will immediately communicate his or her contribution to the P&L (once he feels there is sufficient evidence). The shortcut or the “hustle for the next Euro” is something she or he is proud of.
HR seeks perfection as a collective
Similar to a violin player in an orchester, who understands that he/she is part of a bigger team, HR iterates carefully and seeks consent with the organization.
Rather than finding business value in a quick and dirty way, it is deep in the nature of HR departments to look for (global) process answers. HR departments are used to seek confirmation for their approach, internally and externally by talking to vendors/ experts.
Getting it “100% right” from the start, prevents HR from exposing, testing and quantifiying their initiatives at an early stage. The P&L impact is given a lower priority than the process of making the related changes to the organization/ policy.
Best Practice "Communicate in Euros instead of Processes"
Start communicating a Euro number for your People Analytics initiatives. Test as early as possible to roughly validate your business impact and communicate this number to senior leadership.
Lesson #2: Think in Personas & Audiences
As a former CMO, I get worried when people talk about “the customer”. The implicit assumption is that there are enough commonalities to group all customers together. The same holds true for employees.
Therefore, companies should look into two major concepts in marketing, namely PERSONAS and AUDIENCES. In particular employee personas are essential, when you discuss People Analytics use cases and their operationlization with your leadership.
Personas help to inform strategic choices in HR
Personas are fictional characters, which you create to present typical customer segment. In your company, you might find personas to represent strategic target segments in marketing or you might find personas in your UX and product development teams, when they design and build digital products.
What are personas and why are they important? Without going into details (check out an 2009 Harvard Business Review piece on personas here), the key benefit from a HR perspective will be:
“a highly increase empathy for the different needs of the employees and how certain policy actions will have different impact depending on the employee persona”
Employee personas will provide the overarching structure for all your people (analytics) use cases and products.
Audiences operationalize your communication
While personas provide you with a rough orientation on how the different employees look and feel like, audiences are more temporary and tactical in nature.
Digital marketeers work heavily with audiences. A typical use case is to target potential customers with personalized adds, after they have clicked on a certain product.
How could this concept be translated to People Analytics? My proposal would be to start looking at your HR newsletter data and your intranet click data.
“Audiences, allow you to serve more relevant content to your employees, making HR communication more relevant”
By making content more relevant, e.g. for employee currently looking for job progression, you will increase employee satisfaction.
Best Practice "Employee Personas and Employee Audiences will put the employees needs at the center of your activity and priorization"
Design your people products as well analytics use cases with different personas in mind. In terms of operationalization, think of how to reach different personas and audiences with relevant content, e.g people in onboarding, people interested in career progression.
Lesson #3: Analytics capabilities are build over time
Analytics is the primary force in our economy in years to come. Then why are we not re-inventing our people organization accordingly?
I strongly believe People Analytics has the potential to reconcile the gap between perceived importance of people in the workplace and the actual importance of the HR function. It requires, however, a long-term view on People Analytics as a key capability from Sr. leadership.
People Analytics is a Capabilitiy
Building up people analytics capabilities is to a large degree not different to building up any other analytics/ data science team.
My experience is, that you need three key ingredients:
1. Support by leadership to build analytics capabilities, which ultimately challenge the status quo over time
2. A mix of talent with diverse backgrounds in analytics, tech, and business
3. Technological freedom and specialized support from security /data protection roles
The orchestration of the three skills business, IT, Analytics as well as the related mindset, makes it so challenging to build up great analytics capabilities.
As above mentioned orchestration takes time, my suggestion is to get started with actual use cases. You will need time to recruit the team, educate your key stakeholders, and find first use cases. Once you have first “lighthouse prototype” operational, you can start building momentum by promoting your people analytics strategy.
People Analytics is not a Superpower
Sometime when reading job adds for analytics positions, I feel that the company is looking for a super(wo)man. Analytics, IT, HR, business sense are the usual requirements you will encounter.
Many times, the same person will also be tasked with HR Reporting or planning. This is not to say, that there isn’t a great benefit from HR Reporting or adding technical expertise.
Separate HR Reporting from People Analytics, with latter being a fundamental driver to change your HR operating model and how HR will add business value to the organization.
You should, however, not call it People Analytics. People Analytics should aim at providing actionable recommendations. For example “how can attrition rate in country X be decreased?”. Such recommendations are based on predicting outcomes and not on desribing the status quo (reporting).
Some companies might not be ready for People Analytics and are much better served with investing in better HR reporting and improving the underlying technological systems.
Best Practice "Build a team of experienced data scientists and give them free choice of technology and clear the way for them"
Give enough ressources, be humble as a leader to learn about analytics, but strongly enforce business sense via quantified business value.
Wrap-Up: New People Analytics power results in a new role
When introducing People Analytics to your organization, you should
1) start with a small lighthouse use case and prove business value early (think of the rapper vs. the violinist)
2) make all your initiatives employee centric (use employee personas to design and communicate use cases)
3) build a strong team with analytics expertise outside HR and create an environment (tech, legal support) in which the team can suceed.
Building up People Analytics will take time and investment, but it will result in exciting opportunities to drive business value, earning HR the respect necessary to make a true impact.
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Interesting. Intense. Complex. In consequence a challenge for HR folks to make sense out of all this. This would be my summary from Zukunft Personal 2019. Let me try to help out by focusing on which questions mattered to me and which might also be important for you.
This webinar was given to the HR-Rookies Network Organization in August 2019. In part one we give a short answer to the question “What is people analytics and why should you care?“. In part two, Thomas demos an attrition prediction use case with our people analytics prototoyping app Peacock.
In this podcast, I talk about how people analytics is the most important driver of your HR Transformation. Learn about approaches and mindset.