Flying Blind in the Age of Data-Driven Workforce Planning

Catalant Staff

“CEOs and CHROs now understand that people analytics is a vital part of running a high-performing company…the need for high-quality data is urgent,” Deloitte’s advisor Josh Bersin writes. But accessing meaningful data — and using them effectively — for workforce planning and deployment strategies is easier said than done.

Over 40 percent of CHROs say they are limited to basic HR reporting capabilities.
Less than 20 percent of organizations are able to apply predictive analytics to address key business issues.
Less than 16 percent of leaders say they possess the ability to use data to make inform talent decisions.

Business leaders must analyze the market forces facing their organizations to develop strategies that either counter or capitalize on the forces. Extending these strategies to execution, they must formulate and align initiatives, break down initiatives into projects, and then deploy their workforce to work. But this only works effectively if leaders can leverage quality data on both the work that needs to be done and the workforce needed to do it.

Business leaders must dynamically track the skills and expertise warranted by work (in many cases, new work) and identify skills and expertise gaps across their workforce to proactively address the gaps. Most important, leaders must map their long-term strategic plans to the skills and expertise they need to achieve desired business outcomes. “HR should learn how to tie its data about people to performance and business outcomes. This process must begin with gathering data about the skills, capabilities, and behaviors of the existing leaders and workforce, often done through assessments,” explains Evan Sinar, Rebecca Ray, and Adam Canwell in a recent Harvard Business Review article.

CEOs and CHROs now understand that people analytics is a vital part of running a high-performing company…the need for high-quality data is urgent.”

Source: People Analytics: Here With a Vengeance, Deloitte

Collecting data on employees’ skills and tying them to business outcomes allows organizations to highlight key areas of risk and opportunities for growth. For instance, to identify high potential candidates and employees, leaders might analyze the profile of top salespeople to understand the characteristics of high-quality talent and determine which factors may indicate future sales performance, whether it’s their academic records, previous sales training and experiences, personal and professional networks, or the amount of time they spend with customers.

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Workforce analytics can be used for a variety of other key business issues, from optimizing costs and transforming business models to identifying gaps in skills, finding new recruitment channels, and improving productivity. Execs can even leverage workforce data to foster innovation by understanding the diverse makeup of their teams and identifying cross-pollination patterns associated with developing new ideas and knowledge sharing.

It’s imperative that leaders seize the opportunity to leverage people data to increase business agility, accelerate innovation, and drive greater efficiencies from their operations. With the right data at their fingertips, business leaders are much better equipped to make informed decisions about which skills and expertise they need and what they need to do to get the right people on the right work.

Siloed & Unstructured Data

A truly data-driven workforce planning and deployment strategy requires visibility from investment to impact, but — as most will attest —this is a monumental challenge for companies. First, many companies simply don’t gather great data on their workforces. Second, for companies that do gather data, it’s often fragmented and incomplete. As a result, leaders understandably can’t use the data effectively to inform workforce planning and deployment decisions. Indeed, the greatest barrier to successful workforce planning and deployment is a lack of access to the right structured data.

Research affirms that business leaders are flying blind when it comes to their workforce planning and deployment strategies. Deloitte’s 2017 Global Human Capital Trends report revealed that only 8 percent of business leaders say they have usable data on their employees, and only 9 percent believe they have a good understanding of which talent dimensions drive performance in their organizations.

Only 8 percent of business leaders say they have usable data on their employees
Only 9 percent believe they have a good understanding of which talent dimensions drive

Source: People Analytics: Recalculating the Route, Deloitte

Even good data are often siloed within specific teams and functions. In other words, data are spread — in isolation — across various systems, distributed across functions, and reported into different parts of the business. As a result, the most critical data largely exist independently from one another.

For instance, as the stewards of people, HR holds a considerable amount of useful workforce information: data on recruitment, competencies, skills, experience, career progression, and more. Although most HR departments are sitting on data gold mines, they don’t typically have a sense of the outcomes of the work that’s actually getting done or the quality or speed at which the work is delivered.

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More than 50 percent of companies have difficulty integrating workforce data from HR and non-HR systems.

Source: Unlock the People Equation, IBM

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Only 11% of business leaders trust HR to use data to anticipate and help them fill their talent needs.

Source: Global Leadership Forecast 2018, DDI

Flying Blind in a Highly Reactive Landscape

Imagine you’re the CEO of a major CPG company. You decide it’s mission critical to transform your business and send out a brand new marketing message so you can capture a unique market opportunity. You believe the outcome of this big initiative is crucial to your company’s survival in today’s competitive business landscape and, therefore, an immediate priority. Since this initiative will require large marketing efforts, you decide to expand the marketing team. You want to do it quickly, so you go straight to HR and you tell them you need fast access to marketing talent who is productive, efficient, and can deliver effective business results. Sounds like a good plan, right?

Wrong. There are a number of problems with this plan that will likely lead to ineffective workforce planning and deployment:

  1. HR wasn’t part of the process as you defined your mission critical work, so they likely lack a strong understanding of the desired business outcomes.
  2. You didn’t break down the work to identify the exact skills and expertise needed to get the work done, so HR likely won’t be able to match the right people to the right work.
  3. HR likely doesn’t have data on top performers, so they won’t be able to identify the qualities of someone who is “productive, efficient, and will deliver effective business results.”

A lack of organized, consolidated data leads to highly reactive workforce plans based on zero — at worst — or imperfect — at best — data with no end-to-end visibility from investment to impact. As a result, businesses end up with access to talent who have misaligned skills and expertise, a decline in productivity, and, worst of all, the inability to meet larger strategic goals.

How to Operate With Agility

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With an agile approach to workforce planning and deployment, HR is an active participant in the initial conversations to define desired business outcomes and priorities. Together, business leaders cross-functionally collaborate to break down mission critical initiatives into individualized workstreams and discrete projects. From this exercise, they can get much more precise about the skills and expertise they need to accomplish defined goals. 

By gathering data about the skills, capabilities, and behaviors of their internal workforce, they can easily assess the gap between existing expertise and needed capabilities. Only then can they begin to match the right people to the right work.

With an agile approach to workforce planning and deployment, HR is an active participant in the initial conversations to define desired business outcomes and priorities.

Had the business leader in the example above taken an agile approach to workforce planning, s/he may have realized that it’s not just generic marketing talent the team needs access to, but actually, a digitally savvy marketing automation expert with specialized skills in data analysis and demand generation. The HR department would be aware of the company’s defined desired business outcomes from the start, and would understand the precise skills and expertise needed to get the job done. As a result, the team could be much more strategic about its workforce planning and deployment strategy, and better ensure its adaptiveness by reallocating resources internally, recruiting new full-time talent, or leveraging project-based external talent to fill skills and expertise gaps.

Inspiring Lessons From the Front Lines

Case Study I

Chevron built a global, world-class data analytics function to understand workforce productivity and maintain above-average profitability.

After discovering varying analysis methods and duplicate data across different business units, Chevron formed a small analytics group designed to centralize workforce data collection. With a redefined mission, “to support Chevron’s business strategies with better, faster workforce decisions informed by data,” the group established a global process to prioritize all workforce analytics projects. The data community discussed and shared data models, designed standardized metrics, and developed an in-house analytics program to develop data analysis capabilities among employees, both in HR and other business units.

As a result of the workforce analytic priorities and efforts, the company increased reliability for talent-related decisions while significantly lower costs: the team reported that one business unit was able to eliminate 100 hours of redundant work in one year. The company also experienced a 30 percent increase in productivity due to fewer people doing more work in less time. Business leaders across the company now consult the data team on larger business strategies to make decisions on restructuring and reorganization.

process-automization-white

30%

Increase in
productivity

real-time-development-white

100

Hours of redundant
work eliminated

Case Study II

UPS leverages a data-driven workforce planning and deployment strategy to improve performance management and enhance productivity.

UPS fits their trucks with sensors to closely monitor employees’ behaviors. The sensors collect data about everything from how many times they make U-turns to whether they’re wearing their seatbelts. Data monitoring and analysis enable them to provide accurate feedback and target training toward specific employees where necessary, resulting in a reduction of 8.5 million gallons of fuel and 85 million miles per year, as well as a 20% increase in the number of stops made and packages delivered per day.

process-automization-white

20%

Increase in
productivity

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8.5 million

Gallons of
fuel saved

In today’s competitive business landscape, it’s imperative that business leaders think analytically and take an agile approach to their workforce planning and deployment strategies. Operating with agility enables organizations to leverage a variety of data from multiple sources (HR, non-HR, and external sources) to make informed decisions about the skills and expertise they need and how to deploy them to achieve business outcomes. 

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An Agile Approach to Workforce Planning

With deep insight into the current state of a workforce and a strong understanding of the market forces impacting their organizations, business leaders can compare their workforce supply against business demands, rendering them far more likely to adapt to rapidly changing market conditions and fulfill long-term business goals by getting the right people with the right skills on the most mission critical work.

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It’s imperative that you approach your workforce planning and deployment strategy with agility. Catalant can help.

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