Shell reveals how they delivered on the analytics promise
Jorrit van der Togt, EVP HR Strategy & Learning at Royal Dutch Shell joined HRD Connect to talk about how companies and organisations benefit from analytics, what expectations they should have and what they need to put in place to deliver on the HR analytics promise.
How will analytics transform HR?
I would say, HR is going to be completely transformed through digitalisation, in the next decade you will see a massive application of digitalised technologies into HR. As a result of this, we will get much better and much more data around people and we will be able to combine it with operational data, financial data, safety data, you name it. This then provides a great platform to apply HR analytics to really look at the data, and on the basis of sound evidence take the right people decisions for the business. HR will become much more of an evidence based profession than it is today and offers much more value for less money.
What pitfalls did you experience in implementing your analytics strategy?
I would actually offer two. One is empty empiricism and the other one would be lazy analytics. In regards to empty empiricism, recently I heard a story about an author proudly announcing that there was a correlation between whether or not the CEO running marathons or having pets and the stock market performance – well if that was true, then giving a CEO a pet or a very strict running regimen would actually put up the performance of the stock, and of course that is absurd.
When analysing the data and you always find something but you really want to have a sound theoretical framework before you actually analyse the data. That is pitfall number one.
The other one is that people analyse the data just because they can. For some companies, it is great if you can predict attrition rate, for other companies it doesn’t matter. You have got to start with the business value in mind and the business problem. Those are the two most common pitfalls.
What needs to be put in place to deliver on the HR analytics promise?
I would offer three things. One is, it is really important to get your data right. Without sound data quality, you will not get proper analytics so build that platform. Second, get a couple of good people, data scientists econometricians who really know how to handle that data, and who really know how to link it back to the frameworks. The third one is change management, because you want to move from data to explanations, to predictions to an overall story to action. That requires change management and that requires people who can have a dialogue with the business who really milk out the value of HR analytics.
How can a company take the first steps in implementing an analytics strategy?
Step one is to get your data right, step two is to get your capabilities right. Step three is to make sure business leaders understand the value of analytics and what it can offer. Step four is, make sure that you take a couple of trial runs, don’t bet on just one project, get a bit of a portfolio with a couple of projects that may or may not pay off but have high potential value. Then a couple of projects that problem do not have the highest of values, but are paying off, so you build that credibility. I would say, walk before you run, in the end it will be a transformative experience.