Want to Avoid the Latest HR Fad? Then Dig Into Your Workforce Intelligence

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Mar 15, 2016
This article is part of a series called Editor's Pick.

Today, at a time when hiring, new job creation and voluntary turnover are at 5-year highs, there is no shortage of CEOs making bold talent policy moves.

Indeed, these kinds of programs can increase engagement and productivity. However, they can also bring a myriad of unintended consequences if data isn’t used to inform these decisions.

Using a more scientific approach enables HR to gather the evidence needed to decide whether the latest cool idea will work for their business — or derail it.

Here is a more in-depth look into recent fads and how HR can use analytics and proper workforce planning to determine if these programs are right for their organizations.

Changes to management structure

In early 2014, Tony Hsieh, CEO of Zappos, introduced a self-governing management structure called Holocracy to the organization. Holocracy removes power from a management hierarchy and distributes authority and decision-making across self-organizing teams with clear roles instead.

Hsieh gave his 1,500 employees two options:

  1. Accept the change; or,
  2. Take a generous severance package and leave the company.

A whopping 18 percent of the company’s employees chose to take the severance package, resulting in 30 percent total turnover in 2015 — a rate 10 percent higher than their annual turnover for the previous two years.

With Zappos’ Holocracy structure still in its infancy, 2016’s turnover results will say a lot about the success of the program. But what if the HR team could predict those retention numbers today? Or better yet, before Holocracy was even implemented? It would certainly make planning work and talent pipelines easier.

Utilizing workforce intelligence: In order to predict turnover, HR analysts traditionally spend a large chunk of time gathering data from multiple sources (such as the HRIS, ATS and TMS). Using technology dedicated towards workforce intelligence can put all the necessary information into a single source, enabling you to make valuable predictions, such as which critical employees are at risk of resigning, in a matter of minutes.

By identifying at-risk key or top talent, HR can take laser-focused steps to retain those individuals before implementing a new HR policy.

Furthermore, HR can use data to create workforce plans that show the total costs of implementing Holocracy for different scenarios, such as with and without turnover. It is much easier to decide on a drastic organizational change when you are prepared for a range of outcomes ahead of time.

Unlimited vacations

Another hot HR topic is the unlimited vacation policy adopted by companies such as General Electric, Netflix, and Virgin. Concerns over lost productivity may make many HR departments hesitant to offer this perk, but those that have implemented unlimited vacations have found that employees took the same amount of time off as before and performed just as well.

Utilizing workforce intelligence: Examine your workforce data to get a better understanding of what your PTO situation looks like today: Are employees taking all their vacation days? Are the ones who aren’t showing increased absenteeism or resignation rates?

This information reveals whether employees simply aren’t taking time off — in which case you need to look into why this is occurring — or if staff are taking all their vacation days and still showing high absenteeism and resignation rates. This could be a sign that your time off policy requires an overhaul so staff can get the proper rest needed to perform their best.

Ditching annual performance reviews

According to the Harvard Business Review, over 30 large companies, representing over 1.5 million employees, have gotten rid of annual performance reviews. Instead, these companies are experimenting with alternatives for deciding who gets pay raises, bonuses, and promotions.

But how can you tell if it’s time for your organization to ditch as well?

Utilizing workforce intelligence: The truth is, it doesn’t matter if your company does away with performance reviews so long as you put an alternate system in place. For example, replacing performance ratings with continuous feedback meetings instead.

In order for workforce intelligence to properly guide your talent decisions, you need a complete picture of your workforce — and performance is an important metric. The value of measuring performance is in connecting this data with other workforce policies and dynamics such as compensation and promotions, as well as ensuring that you are being equitable with how rewards are given out.

Be smart — and don’t just copy the latest HR fad

As you gather evidence to support your next bold talent policy move, remember that the key to success is not just to copy the latest HR fad.

To gain maximum returns from program investments, it is important to tap into something that will uniquely work for the employees who make an impact on your business outcomes.

And with the right data, the success of these programs will be easier to foresee.

This article is part of a series called Editor's Pick.
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