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HR Analytics Case Study

This document discusses several case studies of companies using HR metrics and analytics to reduce employee turnover: 1) Credit Suisse used analytics to predict which employees might quit and why, saving the company $70 million annually by reducing turnover risk factors. 2) Best Buy found a 0.1% increase in employee engagement resulted in over $100,000 in annual operating income per store, motivating them to survey engagement quarterly. 3) Experian built a model predicting flight risk using 200 attributes, identifying triggers like team size and commutes, dropping attrition 2-3% and saving $8-10 million.

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Amitabha Gupta
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1K views7 pages

HR Analytics Case Study

This document discusses several case studies of companies using HR metrics and analytics to reduce employee turnover: 1) Credit Suisse used analytics to predict which employees might quit and why, saving the company $70 million annually by reducing turnover risk factors. 2) Best Buy found a 0.1% increase in employee engagement resulted in over $100,000 in annual operating income per store, motivating them to survey engagement quarterly. 3) Experian built a model predicting flight risk using 200 attributes, identifying triggers like team size and commutes, dropping attrition 2-3% and saving $8-10 million.

Uploaded by

Amitabha Gupta
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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CASE

S T U D Y:
HR
METRICS
A M I TA B H A G U P TA
HR 302
MBA 3 R D SEMESTER
• On March 13 2015, the Wall Street Journal
published an article titled: “The Algorithm That
Tells the Boss Who Might Quit”. The article
explored how Credit Suisse was able to predict
who might quit the company. It was one of the first
examples of the now very popular employee churn

Saving money by analytics.


• Not only were the analysts at Credit Suisse able to

predicting who predict who might quit, but they also could
identify why these people might quit. This
information was provided anonymously to

will quit managers so they could reduce turnover risk


factors and retain their people better.
• In addition, special managers were trained to
retain the high performing employees who had a
high flight risk. In total, this program saved Credit
Suisse approximately $ 70,000,000 a year.
Relating engagement with store income

Another great HR analytics case study of


They specifically researched the relationship
people analytics at work was published in the
between engagement and financial
Harvard Business Review. In an article
performance. Engagement is often seen as the
titled Competing on Talent Analytics, the
holy grail of HR – but its impact is hard to
authors describe their research in multiple large
measure.
companies in the US.

The authors describe that some


organizations “can precisely identify the value
of a 0.1% increase in engagement among The significance of this relationship motivated
employees in a particular store.” They take the Best Buy to make employee engagement
example of Best Buy, where a 0.1% increase in surveys quarterly rather than annually.
engagement results in over $ 100,000 in annual
operating income per store.
Turnover at Experian

• Employee attrition at Experian was a problem. The


company was facing levels of turnover that were 3-4%
higher than they wanted it to be.
• By building a predictive model that included 200
attributes, including team size and structure,
supervisor performance, and length of commute,
they were able to predict flight risk.
• An example risk factor was teams of more than 10 to
12 people. The analytics team also identified flight risk
triggers: when someone moved further away from
the office, this would increase immediate flight risk.
• The model was rolled out in multiple regions – with
slight differences to the predictive algorithm. These
insights, combined with good management
practices, reportedly resulted in a drop in attrition of
2-3% over the past 18 months with an estimated
saving of $8,000,000 to $10,000,000.
Flight risk at IBM

A similar analysis was done at IBM, where turnover was high for certain business-critical roles.
Using IBM’s Watson machine learning capabilities, the workforce analytics team build an algorithm
that included sources like recruitment data, tenure, promotion history, performance, role, salary,
location, job role, and more.

The company also included employee sentiment, measured through their Social Pulse. The
hypothesis here was that engagement with social media might fall when employees are thinking
about leaving.

The investment yielded $ 300,000,000 over four years and turnover for critical roles has fallen by
25%. According to the report, productivity has also improved while recruitment cost have fallen.
• Nielsen created a similar predictive model back in 2015. The
first predictive model only included 20 variables, including age,
gender, tenure, and manager rating. Over time, more variables
were added.
• This exercise provided multiple insights, including that the first

Keeping
year mattered the most. First-year employees where checked
whether they’ve had their critical contact points. For example,
the first check-in with their manager had to happen within a

key talent
certain time span after hiring, otherwise, it would trigger a
notification. This was a proven, important condition for first-
year retention.

at Nielsen
• Although getting promoted pushed people to stay, lateral
moves were also a strong motivator for people to stay.
• A significant outcome was that the people with the highest
flight risk in the next six months were approached and the
company was able to move 40% to a new role. Making these
lateral moves increased an associate’s chance of staying with
the company by 48%.
QUESTIONS
& ANSWERS

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