HR INTELLIGENCE

FRAMEWORK - UNIT II
 HUMAN CAPITAL MATURITY
FRAMEWORK:

The People Capability Maturity Model (People CMM) is

a proven set of human capital management practices
that provides an organizational change model through an
evolutionary framework based on a system of workforce
practices.
 APPROACHES IN HR ANALYTICS

APPROACH 1: CLUSTERING
With this approach, we are investigating hidden group patterns with the help
of clustering techniques.
Examples:
Which common people characteristics can predict better sales performance?
Which cluster of recruitment sources can predict better people retention?

APPROACH 2: DRIVER ANALYSIS

With this approach, we try to understand hidden relationships. Most of the
time, we use the word ‘impact’ to explain relationships between events or
people/business characteristics.
Examples:
What is the impact of poor engagement on client satisfaction?
What is the impact of sales training on business revenue development?
 Cont…

APPROACH 3: RISK ANALYSIS

With this approach, we try to understand probabilities or the
likelihood of occurring events.
Examples:
Which high performers are at risk to leave in the next 24 months?
Will the reduction of training investments increase the risk of employee turnover?

APPROACH 4: FORECASTING:
With this approach, we try to understand future trend lines, based on
historical patterns.
Examples:
What will be the employee turnover in the coming 3, 6 or 12 months?
What will be the typical first six months’ time-to-productivity trend line of a call center
newcomer without call center experience?

 
HR ANALYTICS VALUE PYRAMID
LEADERSHIP PRACTICES:

Measuring HR Programs in Financial Terms

Selection and Recruiting of Talent
Delivering Workforce Metrics and Analytics
Driving Internal Mobility and Career Development
Enabling a Strong Self-Learning Culture
Motivating a High-Performance Culture
Identifying and Developing Future Leaders
Promoting Highly Engaged Workforce
Encouraging Innovation and Collaboration
Allocating Compensation Fairly to High Performers
Promoting Health and Wellness
Defining Pivotal Roles
Defining Roles by Skills
Rapidly and Effectively Onboarding New Talent
Selection and Recruiting of Talent
ENGAGEMENT PRACTICES:

EMPLOYEE ENGAGEMENT MODEL:

 Cont…..

Develop and implement a well-planned organizational cascade strategy

Create an awareness of the strategic importance of enhancing employee engagement,

the potential benefits, and their role in achieving success.
Create and then communicate the organization’s vision, values, and goals.

Build a culture of high employee engagement, being inspirational, enthusiastic, visible,

and accessible.
Create needed trust and integrity built on mutual respect and build their credibility,
their every action must “model the way.”
Give employees a voice in helping to increase employee engagement.

Ignite engagement by empowering people to share stories, exchange ideas, and

disseminate best practices in accordance with achieving the vision and goals and living
out the values.
 Cont….

Insure that formal rewards and recognition programs are in place to measure

results – and then to express appreciation by rewarding top performance and

contributions that achieve business objectives and exemplify the values of the

organization.

Hold managers at all levels accountable not only for their team’s engagement,

but also for how that engagement affects the team’s overall performance.

Increase enablement by flattening organizational structures to develop a greater

sense of trust in senior level managers, to give each employee more autonomy and

decision-making authority, and to make it easier for all to see the impact of

contributions on the overall performance of the company.

Invest in employees’ physical and emotional well-being.

 ACCESS TO KNOWLEDGE PRACTICES:
TACTICAL KNOWLEDGE MANAGEMENT BEST PRACTICES:

Knowledge Sharing

Knowledge Reuse:

Shared work producers

Shared work practitioners

Expert seeking novices

Miners of secondary knowledge

Knowledge Creation:

Enabling knowledge sharing: As above

Creating suitable work related environments

Providing access to collaborative IT systems

Providing access to relevant data and information

Knowledge Acquisition

Common IT systems

Common projects

Interaction and socialization

Involvement of partners in certain organizational processes (e. g. design)

Cultural alignment (for mergers or joint ventures)

Setting up the right incentive systems

Identifying and protecting crucial knowledge assets
 STRATEGIC KNOWLEDGE MANAGEMENT BEST PRACTICES:

KM and Organizational Structures

KM and Organizational Culture Change

KM and Knowledge Retention

KM and Core Competencies

Identifying what the firm knows, and what its main expertise is.
Leveraging knowledge assets across the organization.
Building the right know-how and expertise to match strategic requirements.
Isolating and removing/changing obsolete knowledge.

KM and the External Network

KM and Knowledge Management Systems

Organizational fit: Carry out internal assessment of needs and work practices, cost-benefit analysis, etc.
Organizational acceptance: by involving the user in the design and implementation, through managerial and
technical support, and with product champions, etc.
Continued use: A function of perceived attractiveness factors and content management
PEOPLE RESEARCH AND ANALYTICS
PRACTICES

People analytics can help to assess the effectiveness of people practices, programs,
and processes. Understand how knowledge of social and data sciences can help you
make more informed, objective people decisions.

People Analytics is about using a data-driven approach to inform people practices,

programs and processes.

Analytical techniques, ranging from reporting and metrics to predictive analytics to

experimental research can help uncover new insights, solve people problems and
direct HR actions.
 Cont….

Google, use people analytics as a foundational building block that informs

everything to find, grow and keep Googlers.

1. FOCUS ON THE BUSINESS

2. HAVE YOUR TOP MANAGEMENT FULLY INVOLVED
3. HAVE AN INSPIRATIONAL LEADER
4. POSSESS A BALANCED SET OF SKILLS AND CAPABILITIES
5. LEVERAGE RESOURCES FROM OUTSIDE HR (AND THE COMPANY, IF NEEDS BE)
6. HAVE A CLEARLY DEFINED STRATEGY AND VISION
7. GET THE BASICS RIGHT
8. HAVE A METHODOLOGY FOCUSED ON PRODUCING ACTIONABLE INSIGHTS
9. USE STORIES AND VISUALISATION TO COMPEL ACTION
10.UNDERSTAND ANALYTICS IS A LONG-TERM INVESTMENT
11.PUT THE EMPLOYEE AT THE CENTRE
12.MAKE ANALYTICS PART OF THE DNA
13.COMMUNICATE SUCCESSES
14.CONTINUALLY LEARN AND ARE NOT AFRAID TO FAIL
15.KEEP AN EYE ON THE FUTURE
16.DON'T FORGET THE 'H' IN HR
 HR INTELLIGENCE CYCLE
HR INTELLIGENCE CYCLE MODEL:

The model was born out of research conducted by the Organizational Intelligence
Institute.

 The model provides a straightforward foundation that can be used by HR leaders,

practitioners, and the business to formulate the design of an employee data lake.

 The model includes seven steps aimed at helping companies develop HR research
and analytics capabilities (Falletta 2014). 
Cont…
STEPS INVOLVED IN HR INTELLIGENCE CYCLE:
Step 1: Determine Stakeholder Requirements

Identify strategic and tactical research, data and informational needs, expectations and priorities;

Secure involvement, commitment and support of the HR research and analytics effort to increase ownership of

the intelligence results, both positive and negative;

Provide communication on the ongoing progress of the overall HR intelligence cycle; and,

Ensure utilization of the intelligence results and recommendations.

Step 2: Define HR Research & Analytics Agenda

Organize the general stakeholder requirements by theme or major topic;

Pose broad research questions for each theme or major topic and use stakeholders’ language and terminology

to the extent possible;

Under each of the broad research questions, begin generating targeted research questions, which lend

themselves to measurement;

Identify both the long-term and short-term requirements of the overall research agenda; and

Share the research agenda with your key stakeholders and go through an iterative process of refinement.
Step 3: Identifying Data Sources
Once the HR research and analytics agenda is established, you need to identify the sources of data that will help to answer the

research questions.

Data sources may be either public or private.

Public data resides in university libraries, knowledge repositories and governmental databases (e.g., U.S. Department of Labor

Statistics).

Private data include a company's internal employee data through HRIS as well as external benchmarking data from "best-in-class”

companies. Research reports and results gathered by credible membership-based consortia (e.g. CEB, The Conference Board, and

the i4CP) and academic think tanks (e.g., Cornell’s Center for Advanced Human Resource Studies, University of Southern California’s

Center for Effective Organizations) are excellent sources of private data and information.

Step 4: Gather Data

Primary research is new or original research that addresses a specific research question or set of questions (e.g., a study to identify

which factors enable or inhibit employee engagement and performance).

Secondary research is data and information available through existing research sources; it may involve examining existing literature

or research reports.

Mining data from your HRIS is another way to gather, query, and analyze data about your workforce, if the system is well managed

and maintained.

Conduct a company-wide employee survey to ensure consistency, ease of analysis across the entire company, and minimize the

impact of over surveying their employee base.

Step 5: Transform Data (Meta-Analysis)

Transforming data into useful and insightful intelligence is arguably the most important yet most

challenging step.

It is recommended that you start small and build your HR analytical capability overtime.

Perform a meta-analysis (i.e., an analysis of analysis) across your disparate data sources.

For example, to what extent are the results from individual 360 degree assessments consistent

with your employee survey data, exist survey data, or actual turnover?

Are high-potential, emerging leaders leaving the company for the same reasons year-over-year

(e.g., little to no advancement and promotion opportunities, lack of decision rights, low base pay

relative to the market)?

Performing the meta-analysis enables you to answer these questions and more importantly

organize and codify information into knowledge and glean critical workforce insights.

Performing the meta-analysis can be simple or complex. This largely depends on the nature of the

data gathered, sophistication and competency of the HR research or analyst and the amount of time

one has to actually conduct the analysis.

 Step 6: Communicate Intelligence Results

HR intelligence cycle involves communicating intelligence results.

The gestalt of HR intelligence places more emphasis on telling a story about the data in
relation to the organization’s most pressing problems and successes.
Connecting to the 'why' of the representative data is where HR leads the charge of
translating useful analytics to actual business issues.

Step 7: Enable Strategy & Decision-Making

Strategy can be simply viewed as the means by which an organization intends on achieving its
overall mission and goals, and creating value for its stakeholders.

Proactive HR analytics arms strategists and decision-makers with pertinent knowledge and
insight to make critical decisions pertaining to human capital.

Moreover, establishing effective HR research and analytics practices can ameliorate ad hoc
‘data fishing and fetching’ by providing HR leaders with real intelligence and predictive insight. 
 ORGANIZATIONAL INTELLIGENCE MODEL
Organizational intelligence is the capacity of an organization to create knowledge and use it to strategically
adapt to its environment or marketplace. 
Organizational intelligence as the problem-solving capacity of an organization created by various subsystems.
These subsystems include

a) organizational structure, culture,

b) stakeholder relationships
c) knowledge assets and strategic processes

a) Structure: Bottom-Up Organizations Are Fast and Creative

Sophisticated I.T. systems permit flat organizations to use employee knowledge to solve operating problems
more directly and quickly.
Some companies, including MCI, Xerox, Johnson & Johnson, Hewlett-Packard and Motorola, have fully
decentralized "bottom-up" structures.
These firms are in turbulent industries rife with change, so they organize knowledge workers into self-
managed units that are held accountable for performance and are then given wide operating freedom to
choose their co-workers, hours, methods and all other aspects of their work.
b) Stakeholder Relations:

Cooperation Improves Communications

Cooperation with stakeholders is not simply "social responsibility" or "business ethics" -- it is a route to

competitive advantage.

Some companies unite all these alliances into complete "corporate communities." G.M., Saturn, the Body

Shop and IKEA develop trusting relations with clients, share power with workers and cooperate with suppliers

while also making better profits. Microsoft, Netscape and America Online have formed complete economic

ecosystems to unite suppliers, manufacturers and distributors in a cluster of cooperating firms.  

c) Knowledge Assets: 

Information Increases when shared

The pooling of information into a common repository that can be accessed by business units is the type of O.I.

most companies currently focus on. Simply put: knowledge increases when shared.

A classic example is the system created by McGraw-Hill a few years ago. McGraw-Hill's C.E.O. created a

corporate-wide information network to unify all business units into an "intellectual community," like a

university or research lab. 

 ELEMENTS OF ORGANIZATIONAL INTELLIGENCE

The elements of organizational intelligence are divided into three types of intellectual
capital:

The performance of an organizational activity depends on the quality of these capitals that
are available within an organization:

Human Capital, Organizational Capital, and Relational Capital.

An organization's Human Capital (HC) is the human resources within the organization that
can be deployed to acquire and apply its knowledge to perform, respond, or control
designated work with available organizational assets.

Organizational Capital (OC) refers to the assets available to the organization to support the
performance of organizational activities

Relational Capital (RC), which combines human capital and organizational capital to
perform, is needed specific organizational activities.
 ORGANIZATIONAL INTELLIGENCE MODEL

 The Organizational Intelligence Model depicted below serves as a useful framework to

facilitate the design and interpretation of most employee survey or organizational assessment
efforts. 
The model includes 11 factors or variables that impact employee engagement and
organizational performance. In many ways, the model can be thought of as a representation of
your organization. 

STRATEGIC
DRIVERS

PRIMARY
DRIVERS

The model defines important factors and relationships to consider during HR

strategic planning and innovation efforts.
 HR INTELLIGENCE IMPLEMENTATION :
Human resources intelligence is a proactive and systematic process for gathering, analyzing,

communicating, and using insightful people research and analytics results to help organizations achieve

their strategic objectives.

Human resources intelligence differs from traditional people research and analytics activities in that

the latter tends to focus exclusively on data and information rather than intelligence per se.

"HR intelligence" means:

 Performing value-added research that enables executive strategy creation, decision-making,
execution and organizational learning;
 Gathering external or competitive data and information on other best-in class companies;
 Gathering internal data and information to better understand our people, talent and work force in
the context of the business;
 Linking multiple data and information sources to predict, model and forecast individual, group and
organizational behavior and performance outcomes;
Transforming data and information into knowledge, insight and foresight; and,
 Communicating and reporting insightful and useful research findings and intelligence results.
 HR INTELLIGENCE CYCLE
To effectively build robust HR intelligence capabilities that are both proactive
and systematic, HR intelligence must be positioned as an ongoing cycle
involving the following critical steps:

Determining stakeholder requirements

 Defining the HR research agenda
Identifying data and information sources
 Gathering data and information
 Transforming data and information
 Communicating and using intelligence results
Enabling strategy creation, decision-making, execution and learning.
 HR IMPLEMENTATION TIPS

Our organization has been performing people research and analytics activities for
years. How should we introduce the notion of HR intelligence?

Why use an organizational model or conceptual framework to transform data and

information into HR intelligence results?

Is it necessary to centralize all people research and analytics work under a single HR
intelligence umbrella or function?

To what extent should the HR intelligence team be connected to the HR strategy
function?
 HR SCORECARD,WORKFORCE SCORECARD
The HR scorecard is a method for Human Resources to position itself as a strategic planning
partner with line managers and executives within an organization.

The HR Scorecard can provide a very useful framework for measuring HR.

The balanced scorecard is a strategic planning and management system that is used

extensively in business and industry, government, and non-profit organizations worldwide to
align business activities to the vision and strategy of the organization, improve internal and
external communications, and monitor organization performance against strategic goals. 

The premise for an HR scorecard is that HR can and should develop metrics to demonstrate
how HR activities impact profitability.

The balanced scorecard is a management system (not only a measurement system) that
enables organizations to clarify their vision and strategy and translate them into action.
HR SCORECARD
 DIFFERENTIATION:YOUR ORGANIZATION’S
WORKFORCE(S)
LINKING HR SCORECARD TO BUSINESS SCORECARD
PROCESS:
Identify the critical deliverables for Human Resources.

Identify HR’s customers (for the deliverables).

Define HR activities that provide the critical deliverables (such as high-talent staffing or a
retention initiative).

Conduct a cost-benefit analyses of activities that provide deliverables.

It’s important to ask the right questions to determine if HR is providing the appropriate
deliverables. Examples of these questions are:

How many exceptional candidates do we recruit and retain for each strategic job opening?

How many hours of results-oriented training do new employees receive annually?

What is the differential in merit pay between high-performers and low-performers?

CONSTRUCTING HR SCORECARD

The development of an HR Scorecard must be done with four perspectives in

mind as follows:

A financial perspective to address strategies that satisfy customers

A customer perspective that asks what customer want

An internal perspective that addresses the stated desires of customers and
designs processes consistent with those desire learning perspective that taken
into account.

HR employees can implement steps to align HR goals with the overall company
mission, vision and business objectives.
 HR SCORECARD IMPLEMENTATION
It is a seven step model:

Clarify the business strategy

Develop HR Architecture
Create a strategy map of the firm
Business Indicators
Results
Identify HR Deliverables in the map
Align HR Architecture with HR Deliverables
Design HR Scorecard
Execute/Implement

HR Architecture

The HR function (services)

The HR management system
Supporting policies and practices such as
Create links between promotions and competencies
Provide skills training
Attract and retain high performers
Strategic Employee Behaviours

 
 HR SCORECARD
STRATEGIC OBJECTIVES KEY PERFORMANCE INDICATORS
Drive Long term Shareholder Value • Shareholder value
• Shareholder value growth
Enhance ROI of HR Strategic Initiatives • ROI of HR Strategic Programs and Initiatives

Enhance Employee Productivity • Profit per Employee

• Revenue per Employee
Create Positive Work Environment • Ranking in “Best Place to Work Annual Survey” (conducted by Fortune
Magazine)
• % of Employee Turn Over
Enhance “Internal Customer” (Employee) Satisfaction • Employee Satisfaction Index
• Employee stability
• Improved Process cycle times
Apply Excellent Recruitment Process • Average lead time to recruit employees
• Recruiting cost per employee
• Performance of New Recruits during the First Two Years of Employment

Develop Strategic Competencies • Average Lead Time to Develop Strategic Competencies

• Average Lead Time to Close Strategic Competencies Gap
• % of Strategic Competencies Available within the Organization
Implement Best Talent Management Practices • Number of Qualified Talents per Strategic Positions
• Progress of Talent Development Plan (actual vs. plan)
• % of Senior Managers who Have Been Promoted Internally
Optimize Performance Management System • Average Competency Assessment Scores
• Number of Performance Feedback Session Conducted per Year
Develop Internal HR Capabilities • % of HR Employees who Develop Individual Development Plan
• % of HR Employees who Fully Execute Their Individual Development
Plan
Deploy HRIS System • Progress of HR Portal Implementation (actual vs. plan)
• Accuracy Level of HR Database