What has Walmart learned from HR analytics?

Walmart has built a team of 70 to manage its HR analytics work and as a result is addressing key business metrics.

The six-year-old team established its reputation within the US organisation and is now reaching out to subsidiaries around the world – meaning it covers all 2.2 million employees.

It began with a team of three and was established after the consumer analytics team, but it has produced some remarkable results.

Speaking at the People Analytics conference, Walmart global people analytics senior director Saba Beyene revealed that work on the cost of turnover was one of the most important projects for the team.

“Like all retail organisations Walmart has a big turnover issue,” she said.

“We were trying to understand what we could do to make the organisation understand that this is big. They were thinking if somebody moves I will get to hire somebody at a lower cost. What they did not understand is the cost of hiring, the cost of on-boarding, the cost of training.

“We were able to quantify all that and make it clear that when you lose an associate within 90 days or less they did not get their money back from hiring that associate,” she added.

 

Bottom-line impact

The results of this came as a complete surprise to the senior management and could have a sizeable impact on the company’s bottom line.

“We now have x% turnover, if we reduce that by 1% we will save millions of dollars,” Beyene continued.

“Everyone was shocked when they saw. In retail it has become ‘it’s not a big deal, I will just hire another one’, but they were shocked, especially the 90 day turnover because it was eye-opening for them.

“We have to educate and be able to collaborate with vice presidents to do that. Once they get it they can sell it to the business,” she added.

Next up is an attempt to calculate the optimal turnover rate, where it gets so low that it no longer becomes productive or cost-effective to reduce turnover further.

Another project which played a part in the team’s expansion case produced an in-depth breakdown of the workforce demographics; including why people came to Walmart and why they left the retailer.

 

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Do it yourself

Beyene also explained how other organisations could potentially follow her lead and build their own analytics team.

“We have to define who we are, what are you trying to achieve? What’s your vision? What’s your mission?” she said.

She noted that strong people were needed because the role could often produce results counter to the perceived intentions of management, while energy and communication skills were of vital importance.

“You have to be able to defend the data,” Beyene continued.

“You have to be able to say to the business, this is what the data is saying, because most of the time in analytics the insight you are giving may not be what they want to hear and so for that integrity is critical.

“Communication to transfer the insight back to the business is critical. If you are trying to transform the organisation you have to fight the fight of what the data is saying and communication is critical, you have to translate the data back to the business in the language they understand.”

 

Business visibility

Beyene has ensured that her team are grounded in the business, with analytics staff regularly visiting stores to understand how they work and what challenges managers and associates are facing.

This integration includes remaining open-minded to all parts of the business – not just focusing on HR-related work.

“People analytics is not just about HR. You can’t be closed minded in HR – you are trying to improve the business – it has to be open to other parts of the business,” she said.

“People have to be able to make connections in finance, in operations, in other areas of the business. We are all in this business to impact this business to impact the bottom line.”

Another word of advice is to go further than people are asking for, and to understand what they really want to achieve when they are asking for some analysis about certain data.

This may be hard work at first, but will build the reputation for integrity that will support the analytics team and its results throughout the business.

Beyene also recommended tracking how long each piece of work takes to complete to help build the case for growing the team and to use some form of branding to help people throughout the business identify and recognise the work that the analytics team does.

 

Hear about the key developments and learn how to build your own analytics operation at the HR Directors Summit