Wed, Jan 12, 2011
Business intelligence (BI) has exactly the same objective as the employment selection process: interpreting past data to forecast results and drive business decisions.
In the case of recruiting, that decision, based on all data available, involves making the best hire possible. Most talent organizations don’t know if they’ve met their objective until months, sometimes years, after making a hiring decision. Business intelligence, however, allows HR organizations to assess quality of hire before an offer’s even extended.
And it’s my belief, for a company to win the war for talent, leveraging BI is as fundamental as interviewing or collecting resumes. Beyond simply collecting metrics, BI is about making those metrics meaningful to drive transformation and innovation within an organization. I’ll give you an example:
One of the most commonly used metrics in talent, whether internal or third party, is time spent (days) to fill an open position. That number in itself doesn’t say much, but when you compare that to information collected from the variables, and outcomes, of thousands of similar previous searches, conducted by thousands of companies, a story begins to emerge.
That story not only tells how long it took to fill a position, but how to fill it faster. It tells not only how one stacks up against internal benchmarks, but what those internal benchmarks should be.
The good news is, this can be done before even opening a requisition, driving better business decisions while positioning the talent function as a true strategic partner.
1. Data: The Foundation of HR Analytics
The hiring and selection process, like all best practices leveraging business intelligence, begins with analytics. Beyond basic tactical metrics, employers should identify and collect all available internal and external data sources to ensure the headcount aligns with organizational need and market demand.
Some examples of data required for successful HR analytics include expertise, education level, experience, performance, satisfaction, time to hire, cost per hire, turnover, training cost, training curve, employment market conditions, and workforce demographics.
2. HR Reports and Dashboards
Collecting raw data is important, but business intelligence requires taking analytics to the next level: formulating an actionable and effective business case to drive towards the ultimate goal of aligning headcount with organizational need and market demand.
Start by building a talent report. Augmenting your existing internal data with data and analytics provided by an Enterprise Service Provider helps provide much needed benchmarking to help craft and refine a search strategy.
For example, Monster’s Job Posting Optimizer tool collects data from millions of previous searches, providing customers with benchmark reports that provide an overview of similar positions being posted, job posting performance, candidate response (by occupation, location, industry, category or period).
Knowing this information is crucial to answering this fundamental question of talent acquisition: How do you get the right seekers to apply to your job and what factors influence that response?
3. Predictive HR Analytics
Predicting the impact of job posting best practices and their response helps target the right candidates efficiently. Like in business intelligence, HR analytics should help to address the ‘who,’ ‘when,’ ‘where’ and ‘why’ for your current – and future – employee population:
Answering these questions starts with understanding the critical concepts of employee (ESAT) and customer (CSAT) intimacy and satisfaction.
ESAT drives employee retention, productivity and efficiency, which, in turn, drives customer satisfaction, lowering your associated costs will be with hiring and training new staff. Customer Satisfaction drives customer retention, which facilitates a consultative relationship that’s mutually beneficial for your firm and your customers.
Having predictive HR analytics is an important step, but to act upon this data, you’ll need to create a talent management plan.
4. Create a Talent Management Plan
Creating a talent management plan is the final (and one of the most difficult) steps in correctly leveraging BI in talent acquisition and management. This requires the talent organization to partner with key internal stakeholders and executive management in creating a culture where talent management analytics are collected, interpreted and strategically incorporated across the organization.
There’s no single approach that works best for getting buy-in; each company, and talent function, operates differently.
The tremendous value realized by utilizing business intelligence in talent acquisition, retention and development, however, is a universal constant.