In an era where big data has a lot of people talking, there’s more information in more applications, accessible by more people from more devices than ever before. As a result, business executives can gain more insight into the various factors and trends affecting the performance of their companies – in a much more measureable way. Thanks to the ever-evolving world of data analytics, these leaders have near-instant access to information about key business functions, such as sales, pricing and supply chain, that impact their bottom line. But one critical business function, HR, up to now has been limited in its ability to provide managers with the granular details they need about one of their most important assets – their people. This problem has set the stage for a new class of business execution software that empowers organisations to align workforce analytics with overall business goals and results. And this is how HR will evolve into a more strategic contributor to the business.
While a traditional talent management suite should be able to automate and manage key HR processes—such as recruiting, performance management and compensation—a business execution suite provides additional analytical tools that help bridge the gap between business goals, people management practices, individual performance and business results. It integrates workforce analytics and strategic workforce planning applications. That capability allows companies to analyse talent and HR data, and correlate it with data from other business functions such as finance, enterprise resource planning (ERP), operations and customer relationship management systems (CRM). This is the basis for developing true predictive analytics on a company’s workforce.
HR must be able to demonstrate whether specific investments in talent programs are delivering returns on investment. This must be done as an ongoing automated process, not as a one-off project. Analytics is the glue that closes the gap between HR and overall business results. This article describes how Coca-Cola Enterprises has used business execution software to optimise and align HR with overall business goals.
The case for business execution
More and more employers are recognising the value in linking HR practices with business results. In the spring of 2011, McKinsey & Company reported that many businesses are improving their bottom lines by “analysing the links between people practices and productivity”.
Additionally, a recent study of 450 organisations by Aberdeen Group found companies that “integrate workforce and business-performance data into their analytics tools are nearly three times as likely to achieve best-in-class performance results”.
HR technology consultancy Knowledge Infusion CEO Jason Averbook says that, with basic automation of HR processes under control, the next natural and necessary step for HR is to fully leverage analytics in a meaningful way.
“You need a suite of measureable talent management solutions that can deliver a positive direct impact on business results,” Averbook says. “And that means having strong analytics in place – a critical piece in solving the overall talent management puzzle.”
The new generation of talent management suites must manage each and every essential HR process, including recruiting, performance management, learning and compensation. Once the essential HR processes are covered, businesses must ensure that people are aligned to business goals and strategies. For example, if a company decides to become more global in its product reach, then that goal must cascade down to the workforce so employees can fully understand where the company is going – and why – and how their individual job functions influence and impact the direction of the company.
The next crucial step is to use analytics to ensure talent and business execution is maximised. It’s the simple-in-theory-but-challenging-in-practice idea of making sure you have the right people doing the right things at the right time. Through analytics, HR can tell how well it has succeeded in connecting talent to business goals and results.