Proud to announce the first of a Monthly Report focused on delivering a simple and easy to understand forward looking view of how effective the United States workforce will be in the immediate future and 5 things to consider doing as a Human Resource practitioner or Manager over the next 1 - 3 Quarters. This forward looking view is derived from collecting relevant U.S. economic indicators (for the last 20 years) and the creation of a WARP Index. The WARP Index, Workforce Analysis Research and Predictions Index, consists of public companies from various industries which generate 30% of the annual U.S. GDP, employ 10%+ of the U.S. workforce and are currently looking to fill 10% of the total U.S. vacant positions. These thousands of data points are then statistically analyzed together in order to assess their impact on the U.S. workforce.
WARP Report for November 2010: The U.S. Workforce is in a “Poor” state and is predicted to be there for the next 2 Quarters at a minimum. Even with some positive indicators pointing to a short term improvement, there are no clear signs that this improvement is sustainable post that.
This week, Susan Wong and myself, attended and gave a presentation on the “What and Why of Workforce Optimization” at hr.com’s first Workforce Planning and Analytics Workshop. There were about 70 in person attendees and was told there were 500+ virtually attendees.
I might be a bit biased, as I am on the advisory board for their certification program and Oracle was a sponsor, but I thought workshop was very good. It was well organized, good topics, well known presenters, and I got to see a lot of products in detail. Only change for the next one would be for them to get rid of their parallel presentation tracks. I would have liked to have been able to see all the presentations, instead of having to pick and choose.
My co-presenter and co-blogger, Susan Wong, did a great job on her part of the presentation and communicating why companies are doing this and how they are. My part, however, was a bit of a comedy of errors. We were the first presenters of the day and the set up for their virtual attendees went down right before we started. The technicians spent the first 15 minutes of the session fixing the issue. These types of things happen at conferences all the time and it was no big deal. Being the good co-presenter that I am, I crammed my part of the presentation into my remaining 15 minutes. I talk fast and had a good caffeine buzz. So I wasn’t too worried.
I had just started getting into the core of the topic and started my wrap up (hey, when you got 15 minutes the start and end just kind of blends together), the camera person ran out of tape. How that happened, being that we were the first presenters, I am uncertain. I was asked to hold on by the camera person. Unfortunately I had used up my entire repertoire of conference appropriate jokes and Starbucks gift cards with the first 15 minute delay. So I just laughed it off with the audience and prayed the camera person would hurry. My prayers were summarily denied when I noticed the camera person just get up and walk out of the room without saying anything. Everybody in the room just looked at each other and laughed. I stopped waiting, finished up the presentation and handed it off to Sue.
Even with the presentation having a rocky start, we learned a lot about the attendees, got their opinions on the state of Workforce Optimization, and they asked good questions. In general, companies are adopting or have knowledge of all Workforce Optimization components. Summary of Attendees & Discussions
- 70% of the attendees have implemented Predictive Analytics and were knowledgeable in it. • 100% were in progress of or had implemented Workforce Planning.
- All agreed that Finance and everyday managers do Workforce Planning every single day. Human Resources need to work collaboratively with them or their initiatives would not get adopted.
- Financial Planning and Microsoft Project rules Workforce Planning today in all companies.
- The group knew of, but was a bit fuzzy on how to do Workforce Modeling and Forecasting. Would have liked to have explored this in more detail. But time did not permit it.
Again this was a good conference and you should look at getting involved in the Workforce Planning and Analytics Certification program for hr.com.
Susan Wong and I are presenting at the hr.com "Workforce Planning and Analytics Conference" in San Francisco on December 1/2. We have a few free passes to this conference. If you are interested in attending, please send me an email firstname.lastname@example.org and in the header put in "Workforce Planning Free Pass". It should be a great conference.
- Dr Jac Fitz Enz
- Jeremy Shapiro, JP Morgan
- Jason Averbrook, Knowledge Infusion
- Heather Whiteman, PG&E
- Scott Pollack, PwC
Only catch is that you have to be an HR Practitioner and not a Consultant or Software Vendor. This isn't my rule, it's the conference's.
I have to admit, when I said 100s of vendors in my last blog "HCM Analytics Roadmap," at the time I wrote it, I knew I was exaggerating a bit...but not by much. So when I saw that another blogger and a linkedin group leader Jeremy Shapiro offered $5 to anybody that could list 100 HCM analytics vendors (actual analytics not compliance reporting), I knew I would soon be using that $5 on a Starbuck Venti Mocha.
Just to have a common definition on what constitutes an "HCM Analytics Vendor" to me, it is:
- A company that sells a product that is specifically built to support the analysis of Human Capital Management.
- The product supports 1 or more of the following roles Human Resources, Managers, Executives, and other functional areas (e.g. finance).
Here is a list of 100 Plus companies, 131 to be exact (minus 5 that offer only compliance reporting), that offer some form of HCM Analytics. I am thankful Jeremy didn't ask for "100's of Analytics vendors" as that would have definitely been a challenge
Ever tried to figure out how to build an HCM Analytics roadmap and which or how the 100s of vendors out there would fit into it?
It’s similar to putting hundreds of different ingredients in front of you and asking you to exactly replicate the meal you saw one of the Iron Chefs made on TV without a recipe. You know what it looked like at the end but aren’t sure how to get there. When and how much cumin did the chef add? Did the chef use that flamethrower thingy to toast the pine nuts or was it used just to intimidate the competition? It can be beyond dizzying.
Let me share something with you that has helped me in building out HCM Analytics Capability Roadmaps. McKinsey and Co asked me to put together a Human Resource capabilities level roadmap which would be used to quickly figure out the existing technology capabilities of any Human Resource department and determine what it would take to move them to the next capability level. At the time, it was used to figure out whether or not a company was ready to move out of “HR back off automation” and move to the next capability level of delivering self service transactions to managers and employees.
Below is what I put together.
Yeah I know…consultants like pictures without a lot of details. Let me define each of the levels. Caveat, with this being a blog, I'll try to keep it short.
- Foundation: You have a Core Human Resource application which allows you to store worker data, modify workers (hire to fire by an HR person), providing benefits, and making sure people get paid. At this level your analytics capabilities are; 1) federal/regulatory compliance reporting, 2) basic HR only operational reporting through some sort of ad hoc query tool (e.g. headcount), and 3) put in place HR specific key performance indicators.
- Transaction: You have expanded beyond Core HR. You are now having your employees manage their own data and offer Talent Management capabilities, such as Performance or Learning. At this level your analytics capabilities are; 1) you can start to measure and improve the data quality in your Core HR and downstream systems, 2) start to support functional specific dashboards built on top of the transactional applications (e.g. Compensation Dashboard) , and 3) put in place worker specific key performance indicators (e.g. how many top performers should there be).
- Process: You have started to weave your transactions into orchestrated processes, such as OnBoarding or OffBoarding. At this level your analytics capabilities are; 1) have or are implementing a warehouse in order to merge data from multiple different functional areas, 2) provide role based dashboards that merge HR information with a worker’s or organization’s sphere of influence (e.g. sales is ability to see that Average Sales Price for a worker has slipped because they lack training on the new product), and 3) put in place process specific key performance indicators (e.g. how long does it take for a new hire to be productive and is it taking less or more time than last month).
- Plan: This is where HR starts to move from tactical to strategic. You have embedded HR information into the existing business planning cycles and existing planning applications. At this level your analytics capabilities are; 1) ability to know workforce headcount, cost, and objective targets real time to 12 to 18 months in the future, 2) report on the readiness to meet those headcount, cost, and objective targets at all levels of the organization before they become due, 3) HCM applications are updated based on the outcome of those planning cycles, and 4) put in place company key performance indicators (e.g. did the company meet workforce costs for the quarter).
- Model & Forecast: You are working directly with the lines of business on how to improve their ability to meet its organizational and individual objectives. At this level your analytics capabilities are; 1) show what the impacts would be for new organizational designs, and 2) ability to show what the impact would be by tweaking 1 to many elements of on an organization or individual (e.g. what if I gave a 2% increase), and 3) ability to put in place event specific KPIs (e.g. did the layoff meet forecasted cost reductions).
- Predict: You have consolidated all applicable indicators in order to predict challenges or opportunities with existing or new organizational and individual worker objectives. At this level your analytics capabilities are; 1) you have moved from the manually determining Key Performance Indicators and have implemented predictive data mining tools that tell you what they should be based on looking at 100s to 1000s of indicators, 2) ability to identify hot spots in the organization before they occur, and 3) able to provide quantifiable business cases required to make costly workforce policy changes (e.g. I know this specific team, in this specific, region, and workers with this specific profile will have a retention problem and making adjustments to these 3 things will prevent it).
By knowing what each capability level consists of, figuring out where you are within it and knowing what the next one is, you should be able to put together an initial roadmap fairly quickly. You of course will have to do some hard work after that. Turning the roadmap into a reality .
Hope this helps and if you have questions or input on it please let me know.
PS. In writing this blog, I did some research on the Iron Chef “flamethrower thingy”… see the Flaming Greek on YouTube for videos on how to cook with a flamethrower. Highly entertaining! http://www.youtube.com/watch?v=u20PlTpBjfY