Wolf: HR Analytics’ Time Has Come

By Nancy M. Davis Oct 6, 2011
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CHICAGO--The time is right for HR analytics, HR leaders say. Business leaders have come to expect more from HR professionals when it comes to using business metrics to understand effective ways of managing people.

Speaking Oct. 5 during the Society for Human Resource Management 2011 Strategy Conference here, William Wolf, managing director and global head of HR strategy and innovation at Credit Suisse in New York City, cited the productivity measures of companies in three industries to illustrate how top-performing employees provide substantial advantages compared to average performers:

  • In the front line of fast-food restaurants, top performers are 50 percentage points more productive than their co-workers.
  • In a high-tech factory line, top performers are 85 percentage points more productive than co-workers.
  • Among investment bank associates, top performers are 125 percentage points more productive.

If nothing else, such analytics would easily justify the cost of talent management systems and contribute to the business value of human resources, Wolf argued.

But there’s more: Wolf manages a group of employees devoted to the study of HR analytics. Some other measures they have been examining include:

  • What’s the optimal mix of internal vs. external promotions?
  • What happens when analysts move from one company to another? Do “star” workers retain their status in another environment? The effect of their networks with the former employer cannot be taken for granted, he noted.
  • Do part-time jobs on a resume indicate high performance later in careers?
  • What are the data sets that predict attrition? Wolf said his analysts found 45 variables related to attrition, and they are working on models to predict attrition rates.
  • How do you identify people who will stay and those who will leave? Can you predict who in the organization is at risk of leaving? “We look at time in a role without a promotion—that’s a huge variable,” he said.

Nancy M. Davis is editor of HR Magazine.

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