What is in your HR Toolbox?

Is HR modernizing fast enough? It’s a question practitioners are constantly asking themselves as they navigate the transition from traditional business partner who gives advice on culture, compensation and policies, to a harder-hitting evidence based function that can tap into productivity and discretionary effort like never before. Increasingly, leading-edge HR departments are adding data and analytics functions – previously the domain of IT and strategy departments.

Specifically, they are focused on three elements:

• First, they are looking beyond HR data. They are layering people insights with financial data, operational inputs, and industry trends for their business, and identifying relationships that can often be overlooked, but are critical for high performing organizations to understand
   
• Second, they are moving from a rearview ‘lag’ approach to a place of ‘lead’ measures, enabling them to predict the types of drivers that will attract, retain and engage talent
   
• Third, they are partnering in new ways– both with groups inside their organizations, like IT, and with outside data and analytics leaders who can share best practices, provide insights on macro trends, and help pilot new approaches for specific challenges.

Banfield Pet Hospital is embracing this challenge head on. The nation’s largest general veterinary practice built an analytics function inside its HR department that is proving to be invaluable to the overall business. Stephanie Neuvirth, Banfield’s SVP of People & Organization, explains that while the path was not clear, the practice jumped in with both feet to dial-up the level of sophistication in the department and the value People & Organization brings to the organization.

“People are the drivers of our business, and the reality is that we – and the veterinary industry – have limited supply. Our veterinary professionals are highly specialized individuals whom we rely on to care for pets, serve clients, and keep us competitive with leading science and market leadership. If we’re having a hard time staffing, or engaging our talent, that’s a critical problem for our business.”

When building the analytics function, Neuvirth looked in-house first. While it may sound counterintuitive to some, instead of hiring a data & analytics expert from the outside to build Banfield’s people analytics team, she tapped into existing HR business partners because even though they weren’t analytics pros, they knew the operation, the challenges, and the right questions to ask. They then partnered with IT and Finance to drive different conversations with the department, and eventually within the organization. A nice byproduct of this approach is that it expanded career options for existing HR talent in the department, and gave them ways to have greater impact on operations, as well as build transferable skills.

“We started with our big thinkers and a very big question – can we predict doctor turnover to prevent it from happening in the first place? Prior to our analytics focus, we relied on exit interviews, anecdotes, and manager accounts of what may have gone wrong, but by that time, it was too late. We wanted to solve the problems before they happened.”

Enter Nona Scheumack and IBM, an HR business partner who had previously worked serving corporate clients at Banfield and in other corporate giants. She knew strategically how to approach the issue but didn’t have the technical insight. That’s where IBM came in with the expertise to apply machine learning, partnering with Nona and her P&O Analytics team. By examining more than 200,000 individual data records, and over 200 possible drivers, Banfield can now predict with more than 86% surety the top three drivers for doctor turnover. This was a game-changer for the business and Scheumack is now leading the charge to partner with the IT department to build a production ready tool so Banfield can replicate the process and extend it to other business challenges.

Figuring out what will keep talent engaged, productive, and aligned to corporate strategy is a preoccupation for Jacqui McGillivray, chief human resource officer at Element Fleet. After a series of acquisitions and senior executive changes, McGillivray is focused on stabilizing the workforce and driving high performance through transparent communication and very clear pay for performance linkages.

Gartner research indicates that 60% of the employees who leave an organization leave because they don’t understand how their compensation works or how they can influence it through their performance – a statistic that McGillivray wants to change. In the last 12 months she’s added analytics talent to the HR team to deliberately modernize the way data is created and consumed within the organization – specifically around the way people connect to strategy and business performance outcomes and internalize the associated rewards.

“Our global strategy is more robust than ever, with clear objectives, accountabilities and performance metrics that we expect employees to understand and drive. To align employees to the strategy, we are using pay for performance as a key lever which means changing our expectations within HR around how the team needs to design compensation plans, link those to performance metrics, and use analytics to drive understanding of relationships – if you can’t explain a metric to someone, and they don’t know how they can perform differently to impact their pay, then we’ve missed a huge opportunity.”

While embracing high performance through people is not new to HR practitioners, using data and analytics to unlock that potential and reframe the implications is largely still fertile ground. Pioneers like Banfield and Element are setting the pace by redesigning the HR toolbox.