Sunday, October 25, 2009

The Value of Pre-built HR Analytics

It's a beautiful fall day in the Sierra foothills. We spent yesterday picking a neighbor's grapes and while I was tired and achy yesterday, I feel great today. Maybe it's because it's our anniversary and I'm looking forward to a wonderful day with my husband of many amazing years. I started the day in my studio, working on some little Japanese panels. But in the back of my mind was a work issue. I'm writing a white paper on HCM Analytics and one piece of the white paper is on the value of HCM Analytics. Personally, I think that organizations can not long survive and thrive without managing their business, and workforce, with metrics, but I am always challenged by readers and clients to "prove it." Fortunately, the CedarCrestone HR Systems Survey can show some strong and continued links to improved financial performance. And, we're certainly starting to see lots and lots of organizations report on the value they've achieved. Wait and see the white paper for some of those stories. But what I was thinking about this morning is "why pre-built." And what better place to think about this than in my studio where I build quilts.

When I first started making quilts, like most novices, I used patterns. Irish chain was my first, followed by Log Cabin, and some Amish patterns. It's only been as I've matured as a quilter and even had some coaching from incredible art quilt teachers that I've designed my own quilts. Even now, I return to patterns, but put my own creative color choices, or even break the pattern and just use pieces of a pattern, along with my own creative design. I value pattern makers for figuring out how to integrate a particular design piece (like a diamond, star, or other geometric design) into another piece. That integration is critical for merging pieces with the exact measures...and I don't like to take the time to do that engineering calculation all the time.

I think the value of pre-built analytics, such as those from Oracle's business analytics and specifically, the HR Analytics product, is similar. Oracle has done all the integration from a recruiting dashboard into the talent management applications, into financials, and into the system of record. In the learning arena, it has integrated from learning management, to financials, etc. as well as to display a learning dashboard with metrics valuable to the training department. It is not to say that technical resources couldn't do all these integrations themselves, but why take their time? All of those integrations come ready made.

There is another subtle value of pre-built. Here I have to diverge a moment to comment on how many analysts and pundits just love to criticize HR for not being good with numbers. So what? Are these pundits good with numbers? I don't think so! So, how does HR get started? Let them use ideas from others. I say, help HR out with some pre-built functionality and from these examples they can start to branch out to identify the metrics that will matter for their own companies. But starting with pre-built KPIs, metrics, reports, and dashboards gives them a big boost to get started.


brian said...

Lexy -

Solid post and great site. You are correct in that pre-built analytics "products" really help and organization get started in an internal initiative. There are however a couple of key things to take into account when considering what type of firm to partner with in purchasing starter kits.

1. Make sure the partner is a not offering a traditional software product. In such a model, the demo will work well, but the purchaser will find that the firm was really selling software, not a solution to their business problem. The pretty package of a starter kits is just another way of selling more software with no long term accountability for the success within the client.

2. This is what makes SaaS solutions different. With SaaS model, the provider has to deliver not only a starter kit, but also has to deliver continued innovation to make the solution work for the client. The client is not stuck with software that does not work when requirements change; SaaS providers have to innovate and deliver value across the spectrum of analytics a client desires, otherwise the client simply shuts off the service. SaaS is not only a different delivery model than licensed software, it is also a paradigm shift of how content is delivered on ongoing basis within an application.

3. Make sure the provider offers workforce analytics rather than HR analytics. HR analytics just measure the HR function, which is not of value to the larger organization. The market moved to workforce analytics - bringing operational and financial data into the equation - in order to find out how human capital truly does impact larger business goals and objectives of organization.

4. Don't forget about workforce planning. Workforce analytics and planning are iterative and a provider needs to offer both in order for client to get maximum impact on their investments.

Curious as to other's thoughts on this topic.

Amy said...

Terrific Lexy! You - in a post - have at last connected my mom (a quilting fanatic) to my work (business software). Very well done - and welcome to the blogging world!

Lexy Martin (Quilter and Surveyor) said...

Amy....I actually started blogging awhile ago...when I went to India/China last year for the APAC survey. I've even done one other blog on the intersection of quilting and HCM:

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