From selecting the right data to understanding your key levers, this guide will help your change management projects succeed through HR analytics.
It’s simply not true that most change initiatives fail, or at least, there is no fundamental reason for the failure rate. If there were, when millions of organisations around the world transitioned to remote working at the beginning of the pandemic, the majority would have had to shut down completely.
Instead, CEOs, HR and employees were astounded by their success.
What drove that success? A lot of things, but one factor in particular shouldn’t be overlooked. Employees had to be categorised, contracts adjusted, equipment sourced, and the right information had to be going to the right people. This was followed by a requirement to track a host of data points, from employee performance and productivity to wellbeing and engagement.Whether rudimentary or sophisticated, the HR function and people analytics were critical.
Leveraging HR data and analytics will improve the outcome of any and all change processes, so long as you follow a few key concepts from ELMO’s whitepaper on how HR data can inform change outcomes.
Select the right data
Working out which metrics will be used and how they will be gathered should be done at the outset of any change initiative. Metrics can come from internal or external sources, and may include demographic, engagement, payroll and industry benchmark data. The key is making sure the data you gather will help your organisation plan and adjust. It should provide clear answers as to where the gaps are and who is a key stakeholder. Ultimately, these metrics will help build predictive models to enable organisations to analyse the situation, set goals and make predictions.
ELMO’s 2021 HR Industry Benchmark Report found the most frequently used data sources to track organisational performance were:
- Employee turnover
- Employee engagement
- Employee absenteeism
- Length of service
- Time to hire
These are broad metrics, but their usefulness is not in doubt. For example, if you were planning to dramatically expand your company’s IT department, you would want to get a picture of who your current best, long-term performers are in order to build a model of the ideal employee. This would mean looking at your absenteeism, turnover, and length of service data and seeing how they tracked against engagement and performance metrics.
Five crucial questions
The metrics used will depend on the organisation and the intended change. Boston Consulting Group listed what it describes as five “fundamental” HR analytics questions that lead to change management success1.
- Is the target organisation design sufficiently simple, lean and customer-focused?
The simplest method for assessing organisational structure is figuring out the ratio between managers and direct reports. Flatter organisations, with fewer layers of leadership and fewer leadership positions, tend to be more agile and able to adapt to industry and market changes.
- Are leadership roles well designed and staffed, with sufficient attention to the diversity of the leadership team and overall employee engagement?
To give you your best chance at success – and long-term buy-in from all employees – have your change champions come from multiple departments, levels of seniority and backgrounds.
Metrics around diversity and inclusion are essential for this. Leadership should reflect the company it’s part of and only hard data offers an unbiased look at this.
- Will the transformation help create the desired behaviours and ways of working, and are those behaviours and ways clearly articulated?
Here you want to find case studies both within and outside your organisation. Look for examples of where the changes you are contemplating have been implemented (or already existed in the first place) and measure the effect they had. Engagement and performance metrics are important here.
- Are organisation activity metrics, such as attrition rates and internal job rotation frequency, being used to support the transformation?
Maintaining stable attrition rates and ensuring role transitions are seamless from a customer experience perspective are key to driving organisational efficiency, productivity and increases in employee & customer satisfaction.
- For the most critical parts of the business, what are the key people levers that most influence performance?
You want to simplify your analytics as much as possible by figuring out what the key levers are in your organisation. Do high performing employees have specific qualities or traits in common? Do certain managers seem to consistently get the most out of their team? Drilling down into what is already working is a great way to map out the future.
Regardless of the type of change being undertaken, the focus on employee sentiment should remain: How do people feel about the change? How will they fit in with the change? Do they have any suggestions for making the change better or more effective?
To read more about how HR data can inform change outcomes, download ELMO’s whitepaper here.
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