HR Metrics: From Data to Results

Today I had a really nice lunch with a friend who is a Director of Human Resources.  We ate at Mahoney & Sons, right down by the water at the edge of Coal Harbour.  It’s a sunny day today; perfect for enjoying lunch on a patio with views of Stanley Park and the north shore mountains.

Among the many things we talked about, we discussed some of the merits and pitfalls of “HR metrics”.  For the benefit of those readers outside of HR, HR metrics are often toted as the means by which to show the relevance and legitimacy of the HR function.

As a bit of background, HR continues to languish in this struggle to achieve the status it aspires to, among other areas of the organizations of which the functional group is a part.  Common complaints include:

  • HR’s lack of understanding of “the business”
  • A focus on transactional administration, rather than providing strategic leadership and advice to the business
  • A reactive, rather than proactive stance
  • An inability to communicate how what HR’s costs do to drive top line and/or bottom line financial performance

A popular article on this topic can be found on the Fast Company website: Why We Hate HR.

So, during the conversation with my friend she shared some stories of her experiences implementing HR metrics when she first assumed her role as the leader of the HR function.  As the Director of HR, she reports into the Chief Operating Officer and wanted to demonstrate her team’s ability to be a value adding partner to the organization.  A truly great idea!

However, she quickly realized that while the metrics she was able to capture and report were interesting, there was very little that could be done by HR to impact these measures.  This brought me to share my thoughts on the trajectory from data to results with her – and I thought I would take a moment to share them with you here as well.

Here’s how I see it…

1.  You start with DATA

This is the raw material you are working from.  You need to consider what data to capture, why this data matters and what it might tell you, who and how it will be captured, stored, and kept clean.  This could be qualitative or quantitative, however, the goal is typically to have quantitative HR metrics.

2.  You then analyze the data to arrive at INFORMATION

By looking for trends and patterns, doing statistical analysis, and comparing to other data sets you can start to arrive at new insights.

3.  You can use this information to make different DECISIONS

In most cases managers are looking for information that will allow them to make better decisions.  Or a cynic might suggest, managers are just looking for information that will justify the decisions they’ve already made.  Either way there is an opportunity for the data to tell a story when it becomes information – a story that can (1) increase the effectiveness of a decision or (2) decrease the effectiveness of a decision.

4.  Your decisions are sometimes followed by ACTION

Robert Kegan, Harvard Professor and author of Immunity to Change was in Vancouver recently to speak at a BC Organization Development Network event.  He started his talk, which you can see here (Video: An Evening with Robert Kegan and Immunity to Change), with a question: “If 14 frogs are sitting on a log and 3 decide to jump off, how many are left?”  Dr. Kegan encouraged us to resist the temptation to respond, “11!”  His point being that there is a big difference between deciding to do something and actually doing it.

In an organizational setting this is extremely common.  This issue is often labeled as an “inability to execute strategy” or a “failure to implement change”.

5.  Your actions will lead to RESULTS

Your actions will definitely lead to some kind of results.  Let’s hope they’re the kind of results you were hoping for!  When they’re not, we kindly call them “unintended consequences”, but really the outcomes may be disastrous in some cases – many executives have lost their jobs based on the results achieved being different than the results desired.

Linking this back to the topic of HR metrics specifically… if you are gathering HR data (e.g., turnover ratios, absenteeism rates) you should be aiming to be able to do two main things:

(1) move the needle on the HR results – to influence them in the desired direction

(2) demonstrate the link between moving the needle on these HR results and moving the needle on business results (e.g., revenue, profit) in the desired direction

How do you see it?

 

Focus on Impact not Intent

“You make ugly, look beautiful.”  If someone said this about you, how would you feel?

In my experience, about 50% of people perceive this as a positive statement and the other 50% as a negative statement.  Which way did I intend for it to impact you?  Great question!  However, does it really matter what I intended?  Isn’t the impact it had on you more important than what I meant?

Impact is about your reality.  Intent is about mine.

Have you noticed that when the stakes are higher, you tend to focus on the expected impact more than you normally would?  For example, a friend of mine works in a law firm, where the Partners (the owners of the company) range from friendly to fear-provoking.

When writing an email to a Partner who he knows is more likely to misinterpret something – and especially if the Partner is likely respond in a way that is intimidating and humiliating – my friend will spend up to 4 hours writing a 15 minute email.  Have you done this too?

Now, clearly taking 16 times longer to write an email than necessary isn’t very efficient.  And certainly managing through fear isn’t a form of leadership that many of us would condone.  However, what this story shows us is that we are capable of demonstrating more empathy in our communication than we typically do.  By this, I mean we are able to appreciate the other person’s perspective and anticipate their reaction to our message, based on how we predict they will interpret what we say – or write, in this case.

My wife, who is a Clinical Counsellor, would call this “predictive empathy”.  By this she means, anticipating how the other person will feel when they read or hear your message.  Often, we overlook this aspect of communication, which leads to unexpected (or “unanticipated”) reactions from those that we are communicating with.

Whenever we communicate, we are hoping to influence someone’s thoughts, feelings, or actions.  Or at least, we should be in order to be more effective communicators.  If that truly is the case, then the impact we have on someone else’s thinking, feeling, and acting should be our priority.

I believe that any of us are capable of developing the habits and associated skills required to more often and more quickly communicate with impact.  I work at this every single day!  And still have a long way to go…

My challenge to you is to spend the next 24 hours catching yourself whenever you notice you are talking or writing without being clear on who you are trying to influence and how you specifically would like to change their attitudes, emotions, or behaviours.  Once you do this, you will be blown away by just how often you speak without consciously knowing your purpose.

Have I practiced what I’ve preached?  Have I inspired you to take action?

 

Making Tomorrow Better than Today

I was watching a Tony Robbins video clip, in which he was sharing a practical approach to make next year better than this year.  Regardless of whether you are thrilled with your life or feel there is lots of room for improvement, Tony reminds us that there is always room for improvement.  In fact, he often speaks about his personal philosophy of Continuous And Never-ending Improvement (“CANI”), as the path to certain growth, achievement, and even happiness.

In this particular video, he shared a 4-part process that any of us can use to make next year better than this year – and even to make tomorrow better than today.  Here is how you do it:

Step #1 – Select an area of your life you would like to improve and describe what that area is like for you currently.  Be specific!  Write it down.

Step #2 – Write down the rituals that have shaped your current conditions in this area.  Be honest!

Step #3 – Write down what you want.  What’s your compelling vision?  Be specific!

Step #4 – Write down the rituals that will get you your compelling vision.  What would you need to do differently each day to get what you want?

Now the obvious next step is to take action, by beginning to do things differently.  The power of the exercise is that you begin to see your habits differently – and start to see how your habits relate to the results you are getting in your life, for better or for worse.

When I teach Organizational Behaviour, I spend a significant amount of time in the first week (and if I’m really honest, throughout the entire semester) discussing with the students the role of choices (decisions) in our lives.  One way I highlight this is with the following adapted quote:

 

Watch your thoughts, for they become decisions.

Watch your decisions, for they become actions.

Watch your actions, for they become habits.

Watch your habits, for they become character.

Watch your character, for it becomes your destiny.

 

If you’re like most people, the little stingy voice in your head may be whispering something similar to, “But, I don’t want to change my habits!  My habits are easy – they’re a part of who I am!”  If that’s the case, so be it – and you can continue to do more of the same and expect more of the same.

Or if you have your stingy voice under control and are ready to do what is required to change your destiny, perhaps the question lurking somewhere in your mind is,  “When and how do I start taking different actions?”  I would suggest that more productive questions to ask yourself are, “Am I ready, this very instant, to decide to take charge of creating the life I want?” and, “What is one thing I can do immediately to demonstrate my commitment and achieve momentum?”

Decide.  Act.  [Rinse.]  Repeat.