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Value profiling:
How to Identify the Real Challenges for Your Organisation
www.maxb.com
max.blumberg@blumbergpartnership.com
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Personal introduction
2
Professional musician
• One hit!
Academic
• Computer science
• Psychology
• Maths
• Visiting Professor, LUBS
• Visiting Research Fellow,
Goldsmiths, U of London
Work
• Accenture
• Technology start-up
Today
• People analytics
• Global sales force
transformation
• AI app development
• Positioning Game
Agenda
3
1.
• Why is People Analytics Important?
2.
• The Mechanics of People Analytics
3.
• How to Build a Powerful People Analytics
Function
Why is People Analytics important?
Section Sub-title

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Loras College 2014 Business Analytics Symposium | Ron Dimon: EPM Done Right
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people analyticstrainingtalent management
1st principles: Companies deliver value by making investment decisions about various
assets
5
Investor
ROI
Tangible
assets
Intellectual
capital
Customer
capital
Human
capital
Data
Social
capital
Financial
capital
Investors demand
ROI
What can happen if human capital ROI isn’t delivered?
6
Investors leave
Business shrinks
Board replace human capital by automation
wherever possible
Board create a new role whose job is to
achieve desired ROI on human capital
What might limit delivery of human capital ROI in your organisation?
7
Attrition
Recruiting the wrong
people
Etc.
What is the likely cause of the above problems?
The mechanics of people analytics

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People Analytics Foundation
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datahuman resourcesanalytics
Jones Lang Lasalle at The Chief Analytics Officer Forum, Europe
Jones Lang Lasalle at The Chief Analytics Officer Forum, EuropeJones Lang Lasalle at The Chief Analytics Officer Forum, Europe
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conferencecao forumchief analytics officer
What kinds human capital decisions do managers make?
9
People Process Decisions
• Which job applicant should I hire?
Recruitment:
• How much should we spend on learning
management?
Learning
• What should we measure at performance
appraisals?
Performance managament:
• What competencies are important for high job
performance?
Competency management:
Organizational Design
Decisions
How do we develop a more inclusive
global culture?
How much autonomy is optimal between
group functions and business units?
What is the optimal balance between
FTEs & contractors?
We can lay these human capital decisions out like this:
10
PEOPLE
PROCESSES
Level 4
Competency
Management
Rewards &
Recognition
Career
Development
Employee
Relations
Performance
Appraisal
Human Capital
Strategy
Recruitment
Knowledge
Management
Succession
Planning
Learning
Management
Workplace
Design
Change
Management
Workforce
Planning
Human Capital
Infrastructure
WORKFORCE
CAPABILITIES
Level 3
Employee
Engagement
Workforce
Performance
Human Capital
Efficiency
Leadership
Capability
Talent
Management
Workforce
Adaptability
Ability to
Change
Cultural
Alignment
KEY
PERFORMANCE
DRIVERS
Level 2
Productivity
Quality
Innovation
Customers
BUSINESS
OUTCOMES
Level 1
Revenue
Growth
ROIC
Total Return to
Shareholders
Future Value
Capital
Efficiency
Important Value Profiling Principles
1. Managers can only make human capital decisions about
people processes. They can’t make any direct decisions
about workforce capabilities, KPDs or business outcomes.
2. All human capital problems are therefore rooted in poor
people process decisions
3. Every block on the right is likely to have multiple causes on
the left (not a single cause)
4. To improve a business outcome, you have to work
backwards through chain to identify the problematic people
process. Then you repair the people process and hope that
these repairs ripple through and fix your business outcome
problems.
11
How to ensure ROI from your human capital investments
12
1. Identify a
problematic business
outcome
2. Identify the KPDs
which are causing it
3. Identify the
workforce capabilities
causing the KPD
issues
4. Identify the people
processes causing the
workforce capability
issues
• Ideally, we should start with a
business outcome problem; yet
most companies start with WCs
• That’s the principle, but how do
you apply it?

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Inputs to the Value Profiling process
13
e.g. Career Development inputs to the Value Profiling process
14
Outputs from the Value Profiling process
15
Workforce
Management
Performance
Appraisal
Knowledge
Management
Human Capital
Strategy
Learning
Management
Human Capital
Infrastructure
HR PROCESSES Level 4
WORKFORCE CAPABILITIES Level 3
Ability to
Change
Employee
Relations
Performance
Appraisal
Recruiting
Workplace
Design
Rewards &
Recognition
Human Capital
Strategy
Career
Development
Learning
Management
Human Capital
Infrastructure
Knowledge
Management
HR PROCESSES Level 4
WORKFORCE CAPABILITIES Level 3
Employee
Engagement
Employee
Relations
Knowledge
Management
Recruiting
Rewards &
Recognition
Employee
Relations
Change
Management
Learning
Management
Succession
Planning
Performance
Appraisal
Human Capital
Infrastructure
HR PROCESSES Level 4
WORKFORCE CAPABILITIES Level 3
Leadership
Capability
Performance
Appraisal
Recruiting
Rewards &
Recognition
Knowledge
Management
Learning
Management
Career
Development
HR PROCESSES Level 4
WORKFORCE CAPABILITIES Level 3
Talent
Management
Business Outcomes
Performance Appraisal
Rewards & Recognition
Career Development
Human Capital Infrastructure
Workplace Design
Recruitment
Learning Management
Human Capital Strategy
Employee Relations
HR Processes
The Three Workforce Capabilities Linked to Capital Efficiency
Leadership Capability Employee Engagement Workforce Performance
Increasing
Impact
KPD: Revenue
The three workforce capabilities
linked to revenue
Outputs from the Value Profiling process
16
Perfor
app
HC
infrastr
Rewar
d
WF
plan
Knldg
e
mgt
Succe
ssPlan
Comp
etenc
y mgt
Recruit
Empye
e
relatio
n
Workp
l
design
Caree
r
dvlpm
t
Low High
Medium Priority High Priority
Low Priority Targeted, Incremental,
Improvements Only
High
Low
Impact on Outcome
ImplementationEffectiveness Learning
mgt
HC
strateg
Change
mgt

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caribbeanpeople performancetobago
In summary, Value Profiling allows us to answer the following questions:
17
1. Is there a relationship between a people
process and a desired business outcome?
• e.g. Is there a relationship between L&D spend and
innovation?
2. How strong is the relationship between a
people process and a desired business outcome?
• e.g. How strong is the relationship between employee
relations and productivity?
3.Which people processes contribute most to a
desired business outcome?
• e.g.Which people processes contribute most to revenue
growth?
Making human capital decisions
The HC decision-making journey
19
1.Anecdotal decisions
2. Reporting and dashboards
3. Data mining
4. Scientific People Analytics
1. Anecdotal decisions
The fundamental reason that we use people
analytics is to avoid anecdotal decision-making
• “It’s obvious that the more you pay, the more productivity you’ll
get”
• “So you’re saying that some test can make better judgements than
me?”
• “I’ve been in this business for 20 years and I know that...”
Human capital decisions are based on gut-feel and
intuition:
• Subjective bias
• Data that the decision-maker already knows
• No sense of looking at multiple factors
Quality is limited by:

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2. Reporting and dashboards
21
• employee turnover
• training hours
• time to hire
• cost to hire
• depth of leadership pipeline
• grievances
• safety records
• etc.
Report simple metrics based on
reactive needs e.g.
• Flat reporting
• Comparing across businesses, roles, regions
• Trend analysis
• Benchmarking
Types of reporting
0
1
2
3
4
5
6
7
Performance
Reporting and dashboards: Process
22
1. Build data
dictionary
• Data differs
across
• regions
• businesses
• Functions
• Differs how?
• Update
frequency
• Definitions
2. Integrate data
sources
• Migrate multiple
sources to a
single platform
• HRIS
• development
data
• performance
data
• surveys
• operational
data
• “big data”?
3. Create reports,
dashboards and
visualizations
• Centralised or
self-serve
• Integrated tools
from most big
vendors
• Independent tools
e.g. Excel, OrgVue,
Crystal Reports,
etc.
Reporting and dashboards notes
23
• Therefore not linked to
KPDs or business outcomes
• Linking to KPDs or business
outcomes therefore still
require anecdotal decisions
No statistical analysis
3. Data mining: Does a change in one factor lead to a change in another?
24
0
2
4
6
8
Performance v Engagement
Performance Engagement
Involves
trawling
through all
available
data looking
for
relationships
Companies
like Google
often include
big data

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The document discusses how People Analytics functions can justify their continued existence and budget within an organization. It provides examples of steps a People Analytics team could take: 1. Communicate to executives how People Analytics can help achieve business objectives and shareholder returns through evidence-based people processes. 2. Research the organization's business problems, strategic capabilities, workforce issues and people process challenges by interviewing executives. 3. Generate hypotheses about which people processes may be limiting workforce capabilities. 4. Collect both existing and new data to test the hypotheses. 5. Perform quantitative analysis like regression modeling to test whether hypotheses are correct. 6. Implement findings by updating people processes proven to develop the needed workforce

peopleanalytics
Data mining example
The “real” org chart
Interesting to look at engagement on these “real” teams
25
Peripheral
• Disconnected, risk of exit
• Problem if talented
Central:
• Holds network together
• Can become a bottleneck
• Also a bit of a knowledge broker – if he
leaves, Shapiro, Paine etc. become
disconnected
Data mining
Better than reporting
because at least it
looks at how two
factors move together
The problems are that:
• It seldom starts with a
business problem
• You don’t know which
factor caused the other
4. Scientific People Analytics
“Gut feel”,
intuition
Limited to what
the decision-
maker already
knows
Scientific Analytics
28
Ibuprofen
Headache
reduction
Placebo
Headache
reduction
Example: Making a clinical investment decision

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This document outlines an agenda and presentation for a business analytics seminar for credit union executives and board directors. The presentation will define business analytics, explain how it can help credit unions address key issues like margin compression and regulatory compliance, and provide examples of how analytics can be applied to areas like marketing, risk management, and branch performance. Attendees will learn how predictive analytics can help credit unions retain members, optimize pricing, and streamline operations. The presentation will also cover getting started with business analytics projects.

Scientific People Analytics
29
The key to all scientific
approaches is that they
work systematically
backwards through a
model
1.They start with a
business problem
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MHR Analytics Summit 2018 | Value Profiling: How to Identify the Real Challenges for your Organisation - Max Blumberg

  • 1. All content remains the property of Blumberg Partnership Ltd and may only be used with prior written consent Value profiling: How to Identify the Real Challenges for Your Organisation www.maxb.com [email protected] +44 (0) 1258 628552 +44 (0) 7768 455345
  • 2. Personal introduction 2 Professional musician • One hit! Academic • Computer science • Psychology • Maths • Visiting Professor, LUBS • Visiting Research Fellow, Goldsmiths, U of London Work • Accenture • Technology start-up Today • People analytics • Global sales force transformation • AI app development • Positioning Game
  • 3. Agenda 3 1. • Why is People Analytics Important? 2. • The Mechanics of People Analytics 3. • How to Build a Powerful People Analytics Function
  • 4. Why is People Analytics important? Section Sub-title
  • 5. 1st principles: Companies deliver value by making investment decisions about various assets 5 Investor ROI Tangible assets Intellectual capital Customer capital Human capital Data Social capital Financial capital Investors demand ROI
  • 6. What can happen if human capital ROI isn’t delivered? 6 Investors leave Business shrinks Board replace human capital by automation wherever possible Board create a new role whose job is to achieve desired ROI on human capital
  • 7. What might limit delivery of human capital ROI in your organisation? 7 Attrition Recruiting the wrong people Etc. What is the likely cause of the above problems?
  • 8. The mechanics of people analytics
  • 9. What kinds human capital decisions do managers make? 9 People Process Decisions • Which job applicant should I hire? Recruitment: • How much should we spend on learning management? Learning • What should we measure at performance appraisals? Performance managament: • What competencies are important for high job performance? Competency management: Organizational Design Decisions How do we develop a more inclusive global culture? How much autonomy is optimal between group functions and business units? What is the optimal balance between FTEs & contractors?
  • 10. We can lay these human capital decisions out like this: 10 PEOPLE PROCESSES Level 4 Competency Management Rewards & Recognition Career Development Employee Relations Performance Appraisal Human Capital Strategy Recruitment Knowledge Management Succession Planning Learning Management Workplace Design Change Management Workforce Planning Human Capital Infrastructure WORKFORCE CAPABILITIES Level 3 Employee Engagement Workforce Performance Human Capital Efficiency Leadership Capability Talent Management Workforce Adaptability Ability to Change Cultural Alignment KEY PERFORMANCE DRIVERS Level 2 Productivity Quality Innovation Customers BUSINESS OUTCOMES Level 1 Revenue Growth ROIC Total Return to Shareholders Future Value Capital Efficiency
  • 11. Important Value Profiling Principles 1. Managers can only make human capital decisions about people processes. They can’t make any direct decisions about workforce capabilities, KPDs or business outcomes. 2. All human capital problems are therefore rooted in poor people process decisions 3. Every block on the right is likely to have multiple causes on the left (not a single cause) 4. To improve a business outcome, you have to work backwards through chain to identify the problematic people process. Then you repair the people process and hope that these repairs ripple through and fix your business outcome problems. 11
  • 12. How to ensure ROI from your human capital investments 12 1. Identify a problematic business outcome 2. Identify the KPDs which are causing it 3. Identify the workforce capabilities causing the KPD issues 4. Identify the people processes causing the workforce capability issues • Ideally, we should start with a business outcome problem; yet most companies start with WCs • That’s the principle, but how do you apply it?
  • 13. Inputs to the Value Profiling process 13
  • 14. e.g. Career Development inputs to the Value Profiling process 14
  • 15. Outputs from the Value Profiling process 15 Workforce Management Performance Appraisal Knowledge Management Human Capital Strategy Learning Management Human Capital Infrastructure HR PROCESSES Level 4 WORKFORCE CAPABILITIES Level 3 Ability to Change Employee Relations Performance Appraisal Recruiting Workplace Design Rewards & Recognition Human Capital Strategy Career Development Learning Management Human Capital Infrastructure Knowledge Management HR PROCESSES Level 4 WORKFORCE CAPABILITIES Level 3 Employee Engagement Employee Relations Knowledge Management Recruiting Rewards & Recognition Employee Relations Change Management Learning Management Succession Planning Performance Appraisal Human Capital Infrastructure HR PROCESSES Level 4 WORKFORCE CAPABILITIES Level 3 Leadership Capability Performance Appraisal Recruiting Rewards & Recognition Knowledge Management Learning Management Career Development HR PROCESSES Level 4 WORKFORCE CAPABILITIES Level 3 Talent Management Business Outcomes Performance Appraisal Rewards & Recognition Career Development Human Capital Infrastructure Workplace Design Recruitment Learning Management Human Capital Strategy Employee Relations HR Processes The Three Workforce Capabilities Linked to Capital Efficiency Leadership Capability Employee Engagement Workforce Performance Increasing Impact KPD: Revenue The three workforce capabilities linked to revenue
  • 16. Outputs from the Value Profiling process 16 Perfor app HC infrastr Rewar d WF plan Knldg e mgt Succe ssPlan Comp etenc y mgt Recruit Empye e relatio n Workp l design Caree r dvlpm t Low High Medium Priority High Priority Low Priority Targeted, Incremental, Improvements Only High Low Impact on Outcome ImplementationEffectiveness Learning mgt HC strateg Change mgt
  • 17. In summary, Value Profiling allows us to answer the following questions: 17 1. Is there a relationship between a people process and a desired business outcome? • e.g. Is there a relationship between L&D spend and innovation? 2. How strong is the relationship between a people process and a desired business outcome? • e.g. How strong is the relationship between employee relations and productivity? 3.Which people processes contribute most to a desired business outcome? • e.g.Which people processes contribute most to revenue growth?
  • 18. Making human capital decisions
  • 19. The HC decision-making journey 19 1.Anecdotal decisions 2. Reporting and dashboards 3. Data mining 4. Scientific People Analytics
  • 20. 1. Anecdotal decisions The fundamental reason that we use people analytics is to avoid anecdotal decision-making • “It’s obvious that the more you pay, the more productivity you’ll get” • “So you’re saying that some test can make better judgements than me?” • “I’ve been in this business for 20 years and I know that...” Human capital decisions are based on gut-feel and intuition: • Subjective bias • Data that the decision-maker already knows • No sense of looking at multiple factors Quality is limited by:
  • 21. 2. Reporting and dashboards 21 • employee turnover • training hours • time to hire • cost to hire • depth of leadership pipeline • grievances • safety records • etc. Report simple metrics based on reactive needs e.g. • Flat reporting • Comparing across businesses, roles, regions • Trend analysis • Benchmarking Types of reporting 0 1 2 3 4 5 6 7 Performance
  • 22. Reporting and dashboards: Process 22 1. Build data dictionary • Data differs across • regions • businesses • Functions • Differs how? • Update frequency • Definitions 2. Integrate data sources • Migrate multiple sources to a single platform • HRIS • development data • performance data • surveys • operational data • “big data”? 3. Create reports, dashboards and visualizations • Centralised or self-serve • Integrated tools from most big vendors • Independent tools e.g. Excel, OrgVue, Crystal Reports, etc.
  • 23. Reporting and dashboards notes 23 • Therefore not linked to KPDs or business outcomes • Linking to KPDs or business outcomes therefore still require anecdotal decisions No statistical analysis
  • 24. 3. Data mining: Does a change in one factor lead to a change in another? 24 0 2 4 6 8 Performance v Engagement Performance Engagement Involves trawling through all available data looking for relationships Companies like Google often include big data
  • 25. Data mining example The “real” org chart Interesting to look at engagement on these “real” teams 25 Peripheral • Disconnected, risk of exit • Problem if talented Central: • Holds network together • Can become a bottleneck • Also a bit of a knowledge broker – if he leaves, Shapiro, Paine etc. become disconnected
  • 26. Data mining Better than reporting because at least it looks at how two factors move together The problems are that: • It seldom starts with a business problem • You don’t know which factor caused the other
  • 27. 4. Scientific People Analytics “Gut feel”, intuition Limited to what the decision- maker already knows
  • 29. Scientific People Analytics 29 The key to all scientific approaches is that they work systematically backwards through a model 1.They start with a business problem 2.They hypothesise the causes on the left 3.They test possible solutions