Finding Buried Treasure: The Role of Graph Databases in HCM

Human Resource departments have evolved from administrative functions in businesses into strategic organizational teams, developing and applying Human Capital Management (HCM) techniques. HCM focusses on acquiring, managing, and optimizing employees to positively impact on business value. This approach recognizes knowledge as a critical intangible organizational asset, and focusses on using knowledge to improve strategic and operational efficiencies within businesses. It encourages companies to learn from their successes and mistakes, and those of their competitors.

Human resource departments are critical to businesses as they form the bridge between individual knowledge and institutional goals. However, one aspect of HCM, which is often overlooked by companies, is the importance and value of understanding the relationships between individuals, their knowledge, and their expertise. These relationships are vital to organizational success, but making sense of their ever-increasing complexity is a significant challenge to most organizations.

Until recently, understanding and mapping the relationships within organizations have relied on the expertise of HR professionals and the use of HCM software. HCM software solutions vary significantly in price, quality, and functionality. Selecting software solutions can be a challenging process. Significant hurdles to implementation include cost (of the solution and ongoing maintenance) and flexibility (the ability to add in additional functions). These two issues combine when trying to add other levels of functionality as businesses grow, and the cost of adding in additional modules (such as training, employee retention, and performance management) can be prohibitive. However, one new tool, the graph database, is showing tremendous potential to help organizations in terms of its functionality, flexibility, and cost.

In this article, we’re going to discuss how graph databases can be used to address ten of the most common HCM related challenges experienced by businesses today. Don’t let the name fool you – graph databases aren’t used to generate graphs. They take their name from the graph structures they use to represent and store data.

Graph databases are now one of the most powerful analytical tools currently on the market. They are helping businesses to visualize the relationships between skills, knowledge, expertise, and business outputs. Graph databases are highly visual and interactive. The node (the circle, representing nouns) and the edges (the lines connecting the circles, representing relationships, or verbs) can have multiple characteristics.

For example, we can create a node representing a person called Tom. This node can have various characteristics, including Tom’s education, his start of service, position, salary, skills, and knowledge. Then, there could be an edge/relationship called “knows” between Tom and Mary with its characteristics like, “knows since,” “introduction place,” etc.

Unlike traditional database management systems (DBMS), graph databases treat relationships between nodes in a natural and incredibly efficient way, allowing speedy responses to user’s queries. Moreover, the schemas (the structure) of the graph databases are very dynamic, as the characteristic of nodes, the nodes themselves, and relationships can be added and modified on the fly without technical support. This helps companies to save time and money while providing unparalleled performance.

The analysis and queries are supported through highly intuitive graphical interfaces. Results (as well as the graph databases itself) can be presented online for internal and external audiences. Finally, graph databases offer a more accurate analysis of relationships. Unlike most non-graph based analytical systems, graph databases do not average out the number of nodes and relationships. Just like in real life, some people are better connected than others!

An example of a graph database, illustrating relationships in a fictitious organization is presented below.

Compliance With Laws and Regulations

Graph databases can help businesses to ensure their ongoing compliance with local, national, and international laws. These may include employment laws and regulations affecting the legal status of employees, health and safety, and pay and entitlements. By clearly visualizing the relationships between employees and the law, graph databases can help by showing which employees may be affected by specific legal issues.

Management Changes

Changes in the management structure of organizations often lead to confusion and uncertainty regarding issues, including line management responsibilities, budgets amongst a range of other factors. Organograms are useful tools to explain structural changes, but in large organizations, these can be impractical (and slow!) to produce. Fortunately, graph databases intuitive interfaces mean that reporting changes in structure can now be done almost immediately, resulting in less confusion and wasted time.

Leadership Development

Of course, it’s not only the workforce who need to maintain their skills and expertise. Business leadership in the 21st century may look very different from the last century, as we change societally. Fortunately, businesses can use tools like graph databases not only to understand existing skills and knowledge, but to identify where there may be potential gaps which need to be addressed, either through training or recruitment.

Training and Development

One of the biggest opportunities for graph databases in HR departments is their use in relation to training and development. By tracking existing certification and qualifications, HR departments have a clear understanding of their intellectual capital, as well as ensuring ongoing compliance. Using the same approach, graph databases can be used to identify the training and educational needs of employees and implement upskilling programs as required.

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Adapting to Innovation

Organizational change can be one of the biggest challenges faced by businesses today, and it’s unlikely to disappear.  Once again, we can use graph databases to reduce the potential impact of adapting to both technical and process innovations by developing a better understanding of issues like the skills needed to adapt, potential barriers to adaptation, upskilling requirements, and certification requirements.

Compensation

Reward and recognition systems have been in place for some time now, but they’re often reliant on the employees presenting a case for reward, or completing an annual review assessment. Both of these approaches can be disincentives for employees and paradoxically lead to a more dissatisfied workforce. Compensation can be easily monitored using graph databases technology, and changes in compensation arrangements catered for without the need for specialist programming knowledge.

Understanding Profit Packages

Profit packages are a common source of disagreement between managers and employees and between employees themselves. Failure to clearly understand not only the amounts but the justifications for-profit packages can lead to serious disagreements, and even resignations. Fortunately, we can add financial data such as profit packages to graph databases to explain profits in a much more clear and concise way, leading to fewer opportunities for conflict.

Recruiting

From the very beginning of the employment lifecycle, graph databases can support key processes, including recruitment. Businesses can use graph databases to visualize areas of expertise, skills, knowledge, interests, and other factors pertinent to a potential applicant’s employment. Graph databases can help to reduce the risk of not employing the best candidates, and can also reveal additional employee talents!

Retaining Talent

In highly competitive job markets, the ability of businesses to retain talent is critical. Very often, staff leave roles for reasons other than financial rewards, and understanding personal goals and motivations is a good way to reduce losing key members of staff. Graph databases are excellent tools for visualizing the variety of factors affecting personal motivations and identifying how businesses can retain their best people.

Diversity

Businesses are increasingly appreciating the business case for a diverse workforce. The ability of any organization to promote a sense of belonging and a sense of personal worth is key to attracting and retaining the best people in any industry. Graph databases are a useful way to understand the demographics of an organization, and to consider how they might reflect the diversity of a client base.

Conclusion

In this article, we’ve highlighted some key problem areas for businesses’ HR functions, and have suggested how these can be addressed using graph databases. Graph databases can clearly help with a wide range of HR-related issues and can support candidates and businesses throughout the employment lifecycle: from the time they applied for a role, through an interview, employment, and on to retirement.

The functionality and flexibility of graph databases mean that in comparison to existing software solutions, graph databases can be implemented, maintained, and developed much more quickly and cheaply than existing HR software solutions. In addition, they have the ability to reveal insights into relationships that other tools have yet to match.

Dr. Michael Frelas is CEO of the startup company Cognityx. He is a highly experienced IT professional with nearly thirty years of experience. He specializes in developing business intelligence and advanced analytics solutions to facilitate effective Human Capital Management. Michael has helped numerous businesses (from SMEs to Fortune 500 companies) to derive value from data. He can be contacted via email: michael@michaelfrelas.com.

Cognityx is currently developing its graph database HCM solution, which is available for a free trial on request: info@cognityx.com.

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