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CEB HR Leadership Council™

For Midsized Companies

Selecting
Business-Focused
HR Metrics
A FRAMEWORK FOR MEMBER CONVERSATIONS
The mission of The Corporate Executive Board Company (CEB) and its affiliates is to unlock the potential of organizations and leaders by advancing the science and practice of
management. When we bring leaders together, it is crucial that our discussions neither restrict competition nor improperly share inside information. All other conversations are welcomed
and encouraged.

CONFIDENTIALITY AND INTELLECTUAL PROPERTY


These materials have been prepared by CEB for the exclusive and individual use of our member companies. These materials contain valuable confidential and proprietary information
belonging to CEB, and they may not be shared with any third party (including independent contractors and consultants) without the prior approval of CEB. CEB retains any and all
intellectual property rights in these materials and requires retention of the copyright mark on all pages reproduced.

LEGAL CAVEAT
CEB is not able to guarantee the accuracy of the information or analysis contained in these materials. Furthermore, CEB is not engaged in rendering legal, accounting, or any other
professional services. CEB specifically disclaims liability for any damages, claims, or losses that may arise from a) any errors or omissions in these materials, whether caused by CEB or
its sources, or b) reliance upon any recommendation made by CEB.
HR faces three key
challenges to improving
THREE CHALLENGES TO IMPROVING IMPACT:
Analytic Impact. THE NEW ANALYTICS WORKSHOP SERIES

“Criticality” “Capability” “Credibility”


Where Should I Focus Talent How Do I Upskill My HR How Can I Increase Credibility
Analytics? Function? of HR Data?

Few Business Leaders Believe Most HR Leaders Believe HR Few Business Leaders Trust
HR Analytics Focuses on the Staff Capabilities Are a Barrier Talent Data and Insights from HR
Right Business Questions to Improving HR Analytics Percentage of Business Leaders Who
Percentage of Business Leaders Percentage of Senior HR Leaders Trust Talent Data

17% 18%
Agree Agree

80%
Agree

n = 9,528. n = 108. n = 9,528.


Source: CEB 2013 Global Labor Market Survey. Source: CEB 2013 Analytic Survey Source: CEB 2013 Global Labor Market Survey.

© 2014 CEB. All rights reserved. HRFR9293614SYN

 3
The volume of data
available to HR has
AN EXPLOSION OF TALENT DATA
increased exponentially
over the past 30 years.

Administrative and Talent Management Data Social Technology


Compliance Data and Behavioral Data
Volume of Data

■■ Real-Time Behavioral Data


(e.g., E-Mail Habits)
■■ Passive Candidate Employment and
Personal Preferences
■■ Past Experiences, Skills, and Languages
■■ Professional and Social Networks
■■ Performance Evaluations ■■ Performance Evaluations
■■ Employee Engagement Survey Results ■■ Employee Engagement Survey Results
■■ Talent Assessment Results ■■ Talent Assessment Results
■■ Employee Demographics ■■ Employee Demographics ■■ Employee Demographics
■■ Payroll Data ■■ Payroll Data ■■ Payroll Data
■■ Compliance Tracking ■■ Compliance Tracking ■■ Compliance Tracking
■■ Hire Dates ■■ Hire Dates ■■ Hire Dates

1980 2013
Source: CEB analysis.

© 2014 CEB. All rights reserved. HRFR9293614SYN

 4
CEOs are asking for
more analytics support
PRESSURE ON HR TO CAPITALIZE ON DATA ASSETS
from HR and HR plans
to significantly increase CEOs Want More Talent Data from HR HR Plans to Increase Investments in HR Data
investments in collecting, Percentage of CEOs Who Believe Information Is and Analytics in the Next Two Years
managing, and analyzing Important and Comprehensive Percentage of Senior HR Leaders
data assets.
Information Is Receives Sufficient
Important Information

Costs of
Employee
Turnover 95%
Agree

Return on
Investment in
Human Capital

Assessments
of Internal n = 108.
Source: CEB 2013 Analytics Survey.
Advancement

Labor
Costs

Employees’
Views and
Needs

Staff
Productivity

0% 50% 100%
Percentage of CEOs
n = 1,258.
Source: PwC, “15th Annual Global CEO Survey,” 2012, http://www.pwc.com/
en_GX/gx/ceo-survey/pdf/15th-global-ceo-survey.pdf.

© 2014 CEB. All rights reserved. HRFR9293614SYN

 5
Some HR organizations
recognize the need
FROM REPORTING TO ANALYTICS
to move beyond HR
reporting to talent HR Using Data to Provide Talent Reports HR Using Analytics to Improve Business
analytics. Decisions

Purpose of Reports Is to Provide Talent Purpose of Analytics Is to Improve


Information Business Decisions

Information Provided Is Driven by Leader Analysis and Insights Link Explicitly


Requests and Data Availability to Evolving Business Challenges

Reports Provide Leaders with Talent Insights Provide Implications for Business
Metrics Outcomes

Source: CEB analysis.

Defining Terms

Talent Analytics: The discovery and communication of meaningful patterns in talent data
Talent Metrics: Units of measurement for talent data
Talent Dashboards and Reports: Tools to communicate talent data

© 2014 CEB. All rights reserved. HRFR9293614SYN

 6
HR leaders are looking to
analytics to address key
ANALYTICS CENTRAL TO THE FUTURE OF HR
talent trends shaping the
future of HR. Trends Shaping the Future of HR and Their Implications

Degree Need for


of Change Talent
Required in HR Analytics
Trend Implications for the HR Function (Small to Large) (Low to High)

Talent Shortage Succession Planning Deeper into the Organization: Cascade


and Skills succession planning deeper into organizations to address
Scarcity pipeline challenges further upstream.
Intelligent Sourcing and Attraction: Target use of social
media to gain better insight into candidates.
Personalization of EVPs: EVPs are driven by deeper
understanding of individual employee preferences.

The New Virtual Relationships and Fragmented Work Arrangements:


(Networked) More flexible and virtual relationships develop as employee
Work preferences change across career and life stages.
Environment Network Performance and Learning: Manage employee
performance to deliver enterprise contribution rather than
individual task performance.

Globalized and Multi-Generational Management: Take a segmented


Multigenerational approach to managing multiple generations in the workforce.
Workforce Shift from Expat to Local Talent Investments: Engage in
a deeper development of (and reliance on) local talent
markets.
Knowledge Transfer from Retiring Workers: New knowledge
management capabilities reduce knowledge loss.

Convergence Heightened Talent Scrutiny by Board/CEO: Talent is key to


of Talent business growth; board and CEO are more focused on talent
Management risks.
and Business Migration of HR Transaction Processing to Multifunction
Management Shared Services: HR transactional activities are centralized
in shared services organizations.
© 2014 CEB. All rights reserved. HRFR9293614SYN
Source: CEB analysis.
 7
Some organizations are
translating HR data into
FOR SOME, TALENT ANALYTICS LEADING TO IMPRESSIVE
demonstrable business
value.
RESULTS
Hiring Effectiveness Analysis Yields Assessments and Benchmarking Improve
Millions in Improved Sales Attraction and Selection of Top-Quality
PNC analyzed sales performance of Candidates
external hires versus internal promotions DHL implemented an assessment
and found that internal candidates and benchmarking tool that allows
were significantly more productive than the company to assess graduate
experienced external hires. This discovery candidates for key skills, leading to early
led to revised hiring guidelines and identification of top candidates and
millions of dollars in improved sales. comparisons against competitors.

Employee Wellness Program Evaluation Data-Based Job Leveling Reduces


Saves Millions Attrition
Harrah’s saved millions of dollars after Infosys lowered attrition by assessing
evaluating the effects of wellness ideal experience, tenure, and
programs on employee engagement performance requirements for key
and the bottom line by providing positions and transferring employees
preventative care on-site clinics for who were unprepared for their current
employees. roles to other jobs across the company.

Source: Thomas S. Davenport, Jeanne Harris, and Jeremy Shapiro, “Competing on Talent Analytics,” Harvard Business Review, October 2010; http://www.mckinseyquarterly.
com/Question_for_your_HR_chief_Are_we_using_our_people_data_to_create_value_2772; SHL Case Study: “DHL Shows Its Graduates Lead the Field with SHL Talent
Analytics™,” http://www.shl.com/images/uploads/cs_DHL_GraduateRecruitment_uk.pdf; O’Connell, Patricia, “How Infosys Leads the Way in Leadership,” 16 February 2010,
http://www.businessweek.com/stories/2010-02-16/how-infosys-leads-the-way-in-leadershipbusinessweek-business-news-stock-market-and-financial-advice.

© 2014 CEB. All rights reserved. HRFR9293614SYN

 8
Most organizations
are not yet realizing
FOR MOST, DATA IS NOT LEADING TO INSIGHTS
value from their analytics
investments.
OR IMPACT
HR Analytics Has Led Me to Change a Business Few HR Leaders Believe They Are Getting
■■ Few business leaders have Decision in the Past Year Significant Returns on Analytics Investments
the data and analytics Percentage of Senior Business Leaders Percentage of Senior HR Leaders
support they need from HR.

15% 8%
Agree Agree

n = 1,590. n = 108.
Source: CEB analysis. Source: CEB 2013 Analytics Survey.

Lots of Data; Minimal Insight

“There’s a lot of data out there but not a lot of information.”


VP, HR
Mining Company

© 2014 CEB. All rights reserved. HRFR9293614SYN

 9
Most business leaders
rely on intuition to make
RELYING ON GUT INSTINCT
critical talent decisions.
Less Than One-Quarter of Business Leaders Use Data from HR for Key Talent Decisions
Percentage of Business Leaders Who Use HR Data for Key Talent Decisions

100%

50%

25% 24% 24% 24% 24% 23% 23% 23% 22% 22%

0%

Sourcing Talent

Improving Employee
Performance

Improving Employee
Engagement

Selecting HIPOs

Workforce Planning

Creating an EVP

Developing Leaders

Workforce Mobility

Succession Planning

Organizational Design
n = 9,528.
Source: CEB 2013 Global Labor Market Survey.

Fewer Analytic Tools Exist for Talent Decisions Than Other Critical Business Decisions

“When we make our finance decisions, we use data and spreadsheets. When we make
decisions about our most important asset, our people, we don’t have the same tools.”

SVP
Manufacturing Company

© 2014 CEB. All rights reserved. HRFR9293614SYN

 10
Investing beyond
basic levels of analytic
SOPHISTICATION ALONE IS INSUFFICIENT
sophistication—such as
improving technology Improvement in Talent Outcomes By Analytic Sophistication
and methodology
sophistication—yields
minimal benefits. Although a basic level of …further investments in
analytic sophistication is sophistication alone yield low
High necessary for impact… additional benefits.

Talent Outcomes

Organizational
Average
Low
Low High
Analytic Sophistication
n = 108.
Analytic Sophistication is an Source: CEB 2013 Analytics Survey.
organization’s effectiveness at
using advanced methodology Foundational Data Management Requirements to Achieve Impact
for talent analytics. ■■ Maintaining consistent data governance and standards

Talent Outcomes Include:


■■ Protecting data from risks to security and confidentiality
■■ Employee performance ■■ Maintaining accessible systems to store data
■■ Quality of hire

■■ Employee engagement

■■ Employee retention

■■ Leadership bench strength

© 2014 CEB. All rights reserved. HRFR9293614SYN

 11
HR is following the path
of other functions in
FROM DATA SCIENCE TO DECISION SCIENCE
extracting value from
analytics. Analytic Growth Across Corporate Functions

Analytics Evolution CEB’s Research Key Insight


■■ CEB research has uncovered
important lessons that
helped these functions Marketing CEB MARKET INSIGHTS LEADERSHIP COUNCIL
Recommendation
effectively use data to have Quality, Not Just Data
more impact. Accuracy
Sales CRM E- Social Web From Insight to Action
Focus on insight and
Reports Systems Commerce Media Analytics 2003
recommendation quality,
not just accuracy of
customer and market
data.

More Judgment, Not


Finance
More Data
CEB FINANCE LEADERSHIP COUNCIL

Increasing access
Manage- Budget & Risk
Finance Business Boosting Finance's Analytic to rich data will not
ment Resource Analysis and Maturity
Forecasts Intelligence improve insight delivery
Reports Optimi- Decision 2012
unless it’s matched
zation Support
by improvement in
the ability to apply
judgment.

IT CEB CIO EXECUTIVE BOARD

Improve Information
Usability, Not
Information Virtual “Smart” Social Cloud Overcoming the Insight Information Volume
Deficit: Big Judgment in the
Systems Tech- Devices Tech- Computing Era of Big Data Support better decisions
nologies nology 2011
by making big data more
attainable and useful.

HR CEB CORPORATE LEADERSHIP COUNCIL

Assess- The Analytics Era:


Transforming HR’s Impact
HRIS ment on the Business
Tools 2013

Source: CEB analysis.


© 2014 CEB. All rights reserved. HRFR9293614SYN

 12
Analytic Impact is the
extent to which talent
ANALYTIC IMPACT LEADS TO TALENT AND BUSINESS
analytics are used to
improve decisions.
OUTCOMES
Analytic Impact
■■ Leading Analytic The extent to which talent analytics improves decisions and provides actionable support to key stakeholders
Organizations are those
in the top quartile of
Decision Improvement Actionable Support
Analytic Impact across the
distribution of participating “Analytics Support from the HR Function “HR Is Effective at Providing Actionable
organizations. Improves Talent Decisions” Data-Based Guidance on Key Talent Areas”
Improvement of Decisions Made By: Key Talent Areas Include:
CEO; Sourcing;

+
■■ These organizations ■■ ■■

have 12% better talent ■■ Board of Directors; ■■ Performance Evaluation;


outcomes than the average ■■ Business Leaders; and ■■ HIPO Selection;
organization. ■■ Line Managers. ■■ Leadership Development;
■■ Employee Engagement;
■■ Succession Planning; and
■■ Compensation and Benefits.

Source: CEB analysis.

Analytic Impact Improves Key Talent Outcomesa


Difference in Analytic Impact Between Leading Analytic Organizations and the Average Organization

Average Improvement in Key Talent Outcomes by Leading Analytic Organizations = 12% Average
Organization

1.17 Leading Analytic


1.12 1.10 1.09 Organizations
1.00 1.00 1.00 1.00
Financial Returns on Analytic
Impact1
For the typical organization,
improving Analytic Impact
from median to max can
improve talent outcomes by 12
percentage points, leading to a Bench Strength Employee  Quality of Hire Employee
Performance Engagement
6% improvement in gross profit
margin, which translates to a n = 108.
Source: CEB 2013 Analytics Survey.
$18.9 Million in savings for every a
Talent outcomes were identified by senior HR leaders and surveyed organizations and validated through other internal CEB surveys.
$1 Billion in revenue. 1
Financial information on participating organizations was collected through Compustat for organizations where it was available. The median organization has $9.21 billion in revenue
and a 30.76% gross profit margin. Increasing from median to maximum Analytic Impact improves collected talent outcomes by 12 percentage points, which in turn leads to a 6%
© 2014 CEB. All rights reserved. HRFR9293614SYN
increase in gross profit margin.

 13
Although there are two
paths to improving
THE BUSINESS APPLICATION GAP
Analytic Impact, first
improving business Analytic Impact and Effectiveness at Business Application and Sophistication
application produces
more impact more
quickly. High

■■ Improving business
application alone can
improve Analytic Impact by High Application, Leading Analytic
as much as 14%. Only 17% of organizations
Low Sophistication Organizations match high sophistication
Average Analytic Impact: 1.14x Average Analytic Impact: 1.22x with business application
■■ Improving sophistication of insights.
3% of organizations 17% of organizations
alone can improve Analytic
Impact by as much as 5%.
Business Applicationa

■■ Organizations that have Best Path to Impact


high sophistication but low
business application are
losing up to 17% of potential
Analytic Impact.

Low Application, Low Application,


Low Sophistication High Sophistication
Average Analytic Impact: 1.00x Average Analytic Impact: 1.05x
60% of organizations 20% of organizations

Low
Low Sophisticationb High

Source: CEB 2013 Analytics Survey.


a
Business application is measured by effectiveness at identifying the right business problems, applying business
judgment to data, and engaging leaders to take action.
b2
Sophistication is measured by effectiveness at complex analyses (e.g., predictive and prescriptive modeling).

Business application is the


ability to take specific actions
from talent analytics.
© 2014 CEB. All rights reserved. HRFR9293614SYN

 14
THE ANALYTICS ERA: TRANSFORMING HR’S IMPACT ON THE BUSINESS

CRITICALITY

Prioritize Critical Business Questions

Prioritize the most scalable opportunities for business impact


rather than simply fulfilling on-demand data requests.

Analytics Prioritization Principles

Evaluate talent risks to business strategy to identify key metrics.

Talent Analytics Map

© 2014 CEB. All rights reserved. HRFR9293614SYN

 15
The enormous variety of
possible metrics to track
NO SHORTAGE OF METRICS
and report overwhelms
organizataions. Wide Range of Metrics from “Mild” to “Wild”

Mild # FTEs
Cost/FTEs
Total Compensation per Employee
Employee Commitment Index
Benefits Expense as a Percentage of Total Operating Expense
Average Employee Compensation
Benefits Expense as Percentage of Revenue
Absentee Rate
Compensation Expense Per FTE
Benefits Cost Per Employee
Internal Pay Equity
Employment Brand Strength
Employee Engagement Level
Employee Retention Index
Cost per Hire
Hire and Promotion Rate (Google) Forecast the future organizational structure based
on current hiring and promotion practices.
Revenue Per Employee
Use employee behavior data to identify employees
Departure Probability (Sprint) who are likely to leave.

Employee Loyalty Statistic Use a single question net promoter score to measure
(JetBlue Airways) engagement.

Employee Digital Footprint Size (Intel)

Record how frequently customer-facing staff members


Smiles Frequency
smile to determine customer satisfaction.
(Harrahs Entertainment)

Wild

Source: CEB 2013 Analytics Survey; Innovation Enterprise, “Innovation Enterprises HR & Workforce Analytics Innovation Summit,” 22 and 23 May 2013, https://
theinnovationenterprise.com/summits/hr-chicago2013; Thomas H. Davenport, Jeanne Harris, and Jeremy Shapiro, “Competing on Talent Analytics,” Harvard
Business Review, October 2010; http://hbr.org/2010/10/competing-on-talent-analytics.

© 2014 CEB. All rights reserved. HRFR9293614SYN

 16
Leading organizations
do not track a certain
NO MAGIC METRICS
number or single set of
metrics. Significant Overlap in Top 10 Metrics Tracked by Leading Analytic and Bottom-Quartile Organizations
Top 10 Metrics by Frequency

Overlapping Metrics

Leading Analytic Organizations Bottom-Quartile Organizations

1 Performance Rating Distribution 1 Performance Appraisal Participation Rate


2 Performance Appraisal Participation Rate 2 Gender Staffing Breakdown
3 Total Number of Hires 3 Performance Rating Distribution
4 Internal Hires/External Hires 4 Compensation Gap to Market
5 Employee Engagement Level 5 Employee Engagement Level
6 Average Performance Appraisal Rating 6 Internal Hires/External Hires
7 Average Time to Fill 7 Transfers
8 Average Merit Increase for Each Performance Rating 8 Ethnic Background
9 Compensation Gap to Market 9 Average Merit Increase for Each Performance Rating
10 Average Employee Compensation 10 Total Number of Hires

n = 116.
Source: CEB 2013 Analytics Survey.

© 2014 CEB. All rights reserved. HRFR9293614SYN

 17
Some organizations
have made great
PROGRESS IN TRACKING AND REPORTING TALENT
improvements in tracking
and reporting metrics.
METRICS
From… …To
■■ The way in which metrics are
tracked and reported has
evolved over time, laying the 1 Exclusively Tracking Operational Metrics Tracking Both Operational and Qualitative Metrics
groundwork for influencing Capture operational metrics recorded in Capture critical talent information that is difficult
the decisions of business information systems, such as number of to capture through traditional HRIS database fields
leaders. employees, performance scores, etc. (e.g. engagement and quality of hire) to expand the
potential for metrics to impact business decisions.

2 Track Broad Metrics Episodically


Tracking Key Metrics Continuously
A variety of metrics are tracked at specific times
HR identifies a set of key metrics that are measured
across the year as they align to HR initiatives and
more frequently.
projects.

3 Localized Definitions Standardized Definitions


Metrics are measured differently across functions, Standard definitions are enforced throughout the
business units, and geographies making organization to ensure consistency and enable
organization-wide comparisons difficult. organization-wide comparisons.

4 Reporting Only to Senior Leadership Reporting to Line Managers


Report findings and insights to senior leaders, Report findings and insights to line managers
such as the CEO or board of directors, limiting empowering them to make decisions.
the potential impact of metrics.

Source: CEB analysis.

© 2014 CEB. All rights reserved. HRFR9293614SYN

 18
Business and HR
leaders agree that
MOST ANALYTICS EFFORTS ARE MISALIGNED
talent analytics rarely
identifies the business’s
WITH BUSINESS PRIORITIES
key questions, leading
to misalignment of Less Than 20% of Business Leaders Believe Few Senior HR Leaders Believe Talent
Talent Analytics Are Focused on the Right Analytics Are Effectively Aligned with the
analytic activities and
Issues %707,1 Right Business
%004,1 Issues
investments.
Percentage of Business Leaders Percentage of Senior HR Leaders

14%
17% Agree
Agree

n = 9,528. n = 108.
%3Labor
Source: CEB 2013 Global 92,8Market Survey. %00
Source: CEB 2013 Analytics 6,8
Survey.

© 2014 CEB. All rights reserved. HRFR9293614SYN

 19
Leading Analytics
Organizations engage
ENGAGE WITH THE BUSINESS TO IDENTIFY THE
with business leaders
to understand the most
MOST IMPORTANT BUSINESS CHALLENGES
critical talent-related
business challenges Critical Talent Topics for Business Leaders
Sample Discussion Guide
they face.

What are the talent How can we compete


risks to executing our more effectively for
business strategy? top talent?

Business Talent
Strategy Attraction

Business Talent Identification, How can we accelerate


How should we scale talent
and Financial Engagement and the development of our
with business growth?
Performance Development HIPO staff?

Employee Succession
Performance Risk

What are the highest- How strong is our


return interventions leadership bench?
to boost employee
performance?

Source: CEB analysis.

Design Prioritization Strategies to Maximize Business Alignment

1 Prioritize the Most Scalable 2 Evaluate Talent Risks to Business Strategy


Talent Questions Across the Business

Identify and pursue the most scalable opportunities Prioritize questions and metrics by assessing
for business impact; don’t just fulfill on-demand data the talent risks that could prevent the organization
requests. from achieving its strategic objectives.

© 2014 CEB. All rights reserved. HRFR9293614SYN

 20
Gap Inc.’s newly created
Workforce Analytics
GAP INC. NEEDED TO PRIORITIZE ENTERPRISE-
Team needed a better
way to manage diverse
WIDE ANALYTICS INVESTMENTS
demands from the
business and the Demand Challenge: Supply Challenge:
associated resources to Diverse Issues and Priorities Exist Scattered Data Prevents
Across Brands and Stakeholders Easy Fulfillment of Requests
support those priorities.

■■ HR had a tremendous
Taleo
amount of data scattered
Brand Operations Team
across the business, but it
was not centrally managed
in a way that could provide
an enterprise view of talent.
SuccessFactors
Gap Inc.
Gap Inc.’s Workforce Brand Operations Team
■■
Workforce
Analytics Team— Analytics Team
established to provide
vendor management, data
Oracle G/L
integration, and training
Brand Operations Team
support to the brands—
needed a way to prioritize
critical analytics at the
enterprise level. How do we effectively Learn@Gap
Brand Operations Team
manage demand and
prioritize investments
to serve common, high
priority needs across the
IQ Navigator
enterprise?
Brand Operations Team

“Our vendor could


integrate everything we
have, but that’s way too PeopleSoft
expensive. We want to bring in Brand Operations Team
more data, but what data is going
to have the biggest impact?” Source: Gap Inc.; CEB analysis.

Jamie Dyer
Senior HR Manager, Workforce
SOLUTION
Analytics CHALLENGE COMPONENT 1 COMPONENT 2 COMPONENT 3 RESULTS
OVERVIEW
Gap Inc.
© 2014 CEB. All rights reserved. HRFR9293614SYN

 21
On-demand approaches
generate analytics
ON-DEMAND DATA REQUESTS CREATE
activity but create key
risks to the prioritization
PRIORITIZATION CHALLENGES
of highest-value
opportunities. On-Demand Analytics Process

VP of Finance HRBP, Business Unit A


“This development program is really “I need to see turnover rates for my
expensive. What returns are we business unit, particularly for senior
getting?” leaders.”

Importance: High Gap Inc. Importance: High


Needed: ASAP Workforce Needed: ASAP
Analytics Team

SVP of HR VP, Business Unit B


“How well is our HIPO development “Do we have promotions data from
plan working?” the last five years?”

Importance: High Importance: High


Needed: ASAP Needed: ASAP

Source: Gap Inc.; CEB analysis.

Two Challenges Prevent Prioritization of Highest-Value Opportunities

1 Translation Challenge 2 Volume Challenge


Business requests for data often provide a The volume and diversity of requests
distorted or incomplete view of underlying generated through on-demand approaches
needs and challenges. spreads the analytics team too thin to provide
effective support.

SOLUTION
CHALLENGE COMPONENT 1 COMPONENT 2 COMPONENT 3 RESULTS
OVERVIEW

© 2014 CEB. All rights reserved. HRFR9293614SYN

 22
Gap Inc. aligns analytics
strategy to key human
GAP INC.’S ANALYTICS PRIORITIZATION
capital questions,
identifies the most
PRINCIPLES
scalable opportunities for
impact, and addresses Principle 1 Principle 2 Principle 3
key barriers to realizing
those opportunities.
Conduct prioritization exercise Identify the most scalable Create a roadmap for action and
based on key questions. opportunities for impact. investment.

Question-Based Needs Assessment Enterprise Opportunity Analytics Input Evaluation


Identification

Availability Gaps Application Gaps

100 Human Capital Questions Brand Operations Available? Location Other Barriers Required
Teams’ Responsibilities to Acquiring or Investment
Illustrative Using Inputs

Please rank the top 15. Today Scattered We do not have We need
across the a clear definition to invest
Gap Inc. Workforce
1. Are we losing critical talent? Training Analytics Team Priorities
Turnover of brands in of “critical role.” to ensure
Non-Critical disparate a new
Participation
2. Have we sufficiently minimized time Talent
Segments
systems definition is
Turnover of consistently
to productivity for new hires? Critical Talent applied
Successor across
3. Are we accurately predicting quality Pool Quality for Key
Employee
brands.
Benefits Engagement
of hire? Satisfaction
Positions Recruiting
Productivity Efficiency 2013+ N/A Don’t capture Launch
4. … Versus Competitors reasons for departure
turnover—use survey in all
departure brands.
Staffing New Hire survey to fill the
Ratios Quality gaps.

Source: Gap Inc.; CEB analysis.

SOLUTION
CHALLENGE COMPONENT 1 COMPONENT 2 COMPONENT 3 RESULTS
OVERVIEW

© 2014 CEB. All rights reserved. HRFR9293614SYN

 23
Take Gap, Inc.’s
prioritization principles
BREAKOUT SESSION: CREATE YOUR OWN
and create your own
needs assessment
PRIORITIZATION PRINCIPLES
questions.
Principle 1 Breakout Present Back

Conduct prioritization exercise Creating your own prioritization Present back your top question to
based on key questions. principles. the group.

Question-Based Needs Assessment Create 2 questions from each


category that you would ask your
managers to better understand
their needs in the following areas:
■■ Employee Engagement
100 Human Capital Questions ■■ Diversity
Illustrative
Please rank the top 15.
■■ Talent Management
1. Are we losing critical talent? ■■ Turnover
2. Have we sufficiently minimized time
to productivity for new hires?
3. Are we accurately predicting quality
of hire?
4. …

Source: CEB analysis.

SOLUTION
CHALLENGE COMPONENT 1 COMPONENT 2 COMPONENT 3 RESULTS
OVERVIEW

© 2014 CEB. All rights reserved. HRFR9293614SYN

 24
GAP INC.’S 15 SCALABLE HUMAN CAPITAL QUESTIONS

Turnover and Retention


1. What is our voluntary turnover rate among individuals in critical roles? What are the associated costs to the business?
2. What percentage of our high performers are at high risk for departure?
3. What is our voluntary turnover rate among top performers? What are the associated costs to the business?

Talent Infrastructure
4. What is the depth and quality of the successor pool for key positions?
5. What percentage of our workforce moves internally each year between lines of business or functional areas?
6. What percentage of our workforce is promoted annually? How does this compare across demographic segments and lines of business?
7. Which lines of business or managers are the best developers of talent as measured by the promotions out of their department?

Workforce Productivity
8. How differently do we pay our top contributors from our average contributors? Is this in proportion to their contribution?
9. In the last five years, has workforce productivity increased, decreased, or remained the same? What is our relative performance against competitors?
10. Are we under-staffed in areas, where if we added people, we would increase our profitability?

Diversity
11. How diverse is our managerial population? How does it vary across our lines of business?
12. Is the recruiting pipeline appropriately diverse to ensure diversity in hires and the overall workforce?
13. Is our successor pool sufficiently diverse?

Employee Engagement
14. What percentage of our employees are fully engaged and are “doing their best work” at all time? How does this vary across functions and lines
of business?
15. What percentage of our employees would say they are committed to the organization? Why are they committed?

© 2014 CEB. All rights reserved. HRFR9293614SYN

 25
Gap Inc. surveys
stakeholders
SURVEY STAKEHOLDERS TO IDENTIFY KEY
independently to get a
true assessment of the
HUMAN CAPITAL PRIORITIES
high-priority human
capital questions across Maximize Stakeholder Input, Not Consensus, to Identify Scalable Opportunities for Impact
the business. Key Stakeholders
Gap Inc.
Top 15 Human Capital Questions
Workforce
Banana Piperlime
■■ To gather a variety of Analytics Team Piperlime
Republic
Gap
Top 15 Human Capital Questions
independent perspectives, Banana Republic
Gap Inc. asks the following Top 15 Human Capital Questions
groups to prioritize their Old Navy
Old Navy Intermix Athleta
needs individually (rather
than forming a committee): 100 Human Capital
Questions Survey
–– Each of the five key
Please rank
brands the top 15.
–– Support functions
(e.g., HR, Operations) HR representatives from each brand review the 100 human capital questions provided by the
–– Key senior leaders Workforce Analytics Team and identify the top 15 that are most important to help them make
(e.g., VP of Talent decisions for their business.
Management) HR Generalist Team (Business Expertise)

Top 15
Questions
Old Navy (Old Navy)

VP

HR Operations Team (Data Expertise)

Why Not Take a More Consensus-Based Approach?


Gap Inc. chose not to use a focus group or cross-functional committee because of risks that might hinder the accuracy of the final
priorities, such as:
1. Groupthink and
2. Only representing the loudest voices or strongest personalities.
Surveying each stakeholder group individually ensured a “true” representation of most common needs across the organization.

Source: Gap Inc.; CEB analysis.

SOLUTION
CHALLENGE COMPONENT 1 COMPONENT 2 COMPONENT 3 RESULTS
OVERVIEW

© 2014 CEB. All rights reserved. HRFR9293614SYN

 26
Gap Inc. identifies
the most scalable
NARROW ANALYTICS FOCUS TO MOST
opportunities for
impact from prioritized
SCALABLE OPPORTUNITIES FOR IMPACT
questions and draws
clear boundaries on Establish Ownership Boundaries Based on Scalability of Opportunities
where the Workforce
Analytics Team will focus
its resources. Top 15 Human Capital Questions Analytics Ownership Boundaries
Piperlime
Top 15 Human Capital Questions
Banana Republic Brand Operations
■■ The Workforce Analytics Teams’a Responsibilities
Top 15 Human Capital Questions
Team combines responses
Old Navy
from each stakeholder and
ranks them by frequency of
selection to ensure a true Gap Inc. Workforce Turnover
representation of scalability. Training Analytics Team Priorities of Non-
Participation
–– All questions in the top Critical Talent
15 were selected by at Turnover of Segments
Top 15 Most Commonly Selected
least 50% of enterprise Critical Talent
Questions Across Gap Inc.
stakeholders. Successor Employee
Illustrative Pool Quality for Key
Benefits Engagement
■■ Are we losing critical Positions Recruiting
■■ Gap Inc.’s Workforce Satisfaction
talent? Productivity Efficiency
Analytics Team owns ■■ What is the depth and Versus Competitors
the areas that are
quality of the successor
most important for the
pool for key positions? Staffing New Hire
organization to understand ■■ Do we have sufficient Ratios Quality
at an enterprise-wide level.
internal mobility?
■■ Which lines of business
■■ Brand operations teams or managers are the best
across the organization developers of talent?
own the ongoing, brand- ■■ ...
specific analytics work not
prioritized at an enterprise Source: Gap Inc.; CEB analysis.
level. a
Brand operations teams own analytics work within their brands in addition to other operations responsibilities, such as survey administration and performance management.

SOLUTION
CHALLENGE COMPONENT 1 COMPONENT 2 COMPONENT 3 RESULTS
OVERVIEW

© 2014 CEB. All rights reserved. HRFR9293614SYN

 27
Gap Inc.’s roadmap for
action looks beyond
TRANSLATE HUMAN CAPITAL QUESTIONS
data availability to
identify barriers to the
INTO A ROADMAP FOR ACTION
application of data
related to prioritized Evaluate Required Inputs to Build a Roadmap for Action and Investment
questions. Question Review Data Availability Gaps Data Application Gaps
Committee
What inputs do we need Top 15 Associated Required Available? Location Other Barriers to Investment
to answer these questions? Questions Measures Inputs Answering the Required to
■■ Data availability refers
What barriers must we address Question Effectively Address Gaps
to obtaining critical inputs. to obtain the input?
For example: 1. What are Voluntary Average Today Scattered We do not have a Invest to ensure
critical talent Turnover head count across the clear definition of a new definition
–– Do we have the inputs? departures Rate (critical role) brands in “critical role.” is consistently
really disparate applied across
–– If so, how difficult are costing the systems brands.
they to access? organization?

–– If not, what is required to Voluntary 2013+ N/A Don’t capture Launch exit
Two Three terminations reasons for survey in all
get them/how long will it representatives volunteers (critical role) turnover—use exit brands.
take? from the from brand survey to fill the gaps.
Workforce operations
Analytics Team teams
■■ Data application refers
Source: Gap Inc.; CEB analysis.
to applying the inputs.
For example:
Gap Inc.’s Three-Year Analytics Investment Roadmap
–– Do we have clear
ility
definitions of key terms? Capab
–– Are those definitions Identifying barriers
iness
beyond just data y bus vities.
consistently applied? ge ke
Enga in WA acti Ex

Sy
availability provides a partn
ers in
te plo

st
gr re
–– Do we have associated more realistic picture at a

em
io dd
n
context and supporting of the time and op itio

s
n

po na
investment needed to
tio

rt l d
ork ing

data? h WA
Launc ross HR.
In un at
ta/

te
support key priorities. iti a
n w ongo
za

rm ac g ra es
.

o
ard par ce da

latf .
p ta tio
rdi

le n
iza t of

nt pr
da

da ior
sta ses a rkfo

tio

er ta itiz
n

Partn E . e
o

s.
me zat s/

B d
nd ion
sta ta pr ment
Sta

OR
ces it w

in egi
on

with C to
s
rec nda oce

te n
ati

L&D
pro Aud

gr da
nd

da ple

p at ta
om rdi

develo s
pro dard ta

io
Im

tic n.
jec s

analy . 2014
sta ff d

t.

skills 2013
ko
n
Kic

2012

Source: Gap Inc.; CEB analysis.

SOLUTION
CHALLENGE COMPONENT 1 COMPONENT 2 COMPONENT 3 RESULTS
OVERVIEW

© 2014 CEB. All rights reserved. HRFR9293614SYN

 28
Gap Inc. uses a more
accurate understanding
PRIORITIZATION PRINCIPLES ALREADY BUILDING
of needs, clear ownership
boundaries, and informed
LEADER BUY-IN FOR ANALYTICS SUPPORT
plans for investment to
transition from broad, Investments in Resources to Support Key Users See the Value of New Analytics
low-value support to Priorities Have Already Had Substantial Resources for Improving Their Performance
Impact Across the Organization
high-ROI analytics.
Workforce Analytics Site Usage Has Increased 78%
Since 2011
■■ Effective prioritization
supported a compelling
∆ = 78%
business case for investment,
leading the VP of Global
“The new Workforce Analytics resources
HR Strategy, Technology, have definitely improved our capabilities
and Operations to approve
targeted investments in and made us think differently about our
analytics across 2012 and
2013.
workforce. ”
Manager, Brand Operations Team

2011 2012
Source: Gap Inc.; CEB analysis.

SOLUTION
CHALLENGE COMPONENT 1 COMPONENT 2 COMPONENT 3 RESULTS
OVERVIEW

© 2014 CEB. All rights reserved. HRFR9293614SYN

 29
IMPLEMENTATION GUIDE FOR DEFINING ANALYTICS PRIORITIES
Prioritize Key Human Capital Questions, Not Metrics
■■ Compile a comprehensive list of strategic human capital questions that analytics staff could potentially focus on.
–– Gather questions from literature or vendors/consultants as a starting point.
–– Partner with HR generalists, COE staff, etc. to build, refine, and validate the list.
–– If you do not have dedicated analytics staff to manage this process, consider creating a small action team composed of representatives from across HR (HR generalists, COE
staff, etc.). In this scenario, it may be the committee itself that validates the list.
Tip: Frame each question as qualitative, rather than quantitative, to elevate its impact. (e.g., “Is our successor pool sufficiently strong?,” not “How many successors do we
have?”)
■■ Develop and administer a survey asking participants to prioritize the top human capital questions that, if answered, would help them make better decisions for their business.
–– Identify stakeholders across the business whose opinion would be valuable for prioritization (e.g., HR representatives and senior leaders, leaders and other representatives from
different business units, leaders, and other representatives from support functions, such as Finance or Operations).
–– If you do not have dedicated analytics staff to manage this process, consider creating a small action team to identify and engage with cross-organizational stakeholders.
–– If you are prioritizing within a particular business unit or COE, rather than at the enterprise level, adjust your target list of stakeholders accordingly.
–– Administer the survey to each stakeholder/business unit individually, rather than convening a focus group, to ensure an accurate representation of priorities.

Tip: Time the survey according to your organization’s budgeting and planning cycle so that you can use the results to build a business case for additional investment
in analytics.
Identify and Prioritize the Most Scalable Opportunities for Impact
■■ Compile survey responses, and rank the human capital questions based on frequency of selection.
■■ Define a cutoff point below which questions are not considered (i.e., top 15, selected by at least 50% of respondents, etc.).
–– The cutoff will vary depending on the number of survey participants, the number of possible selections, and the scale of the prioritization (e.g., enterprise versus business unit).
■■ Designate top questions as enterprise priorities; business units pursue other priorities at their discretion.
–– If you are prioritizing within a business unit and have fewer stakeholders, more investigation and scoping may be required to determine top priorities rather than simply
prioritizing based on volume of requests.
Translate Prioritized Questions into a Roadmap for Action and Investment
■■ Create a small committee (five to seven individuals) composed of analytics staff and representatives from among business stakeholders who took the survey.
■■ Review prioritized questions, and identify the associated data and metrics required to fully answer those questions.
–– If you do not have a dedicated analytics staff to select representatives from, select HRBPs or other members of the HR staff based on their interest and experience with
talent analytics.
■■ Identify gaps in obtaining and applying those inputs (e.g., Do we have the data? What’s required to get it? Once we have it, what might make it difficult to use?).
–– If you do not have dedicated analytics staff to manage this process, consider creating a small committee to accurately evaluate the availability of inputs across the HR
function.
■■ Develop a business case and roadmap for action based on gaps identified by the committee.
■■ Present the business case to the head of HR and/or other key stakeholders to obtain buy-in for necessary investments.
■■ Use roadshows, progress updates, trainings, etc. on an ongoing basis to discuss whether initial priorities are still relevant, and identify any opportunities for additions
or modifications.

© 2014 CEB. All rights reserved. HRFR9293614SYN

 30
TALENT ANALYTICS MAP: STRATEGIC TALENT CHALLENGES AND ASSOCIATED FOCUS AREAS

Sourcing/Hiring/Mobility Performance Management Succession Management and Leadership Employee Engagement/Retention Compensation and Benefits Organization Design
and Development Development
Scarce Critical Skills: Does our sourcing strategy target critical What development interventions should Are we missing critical skills among leaders Are employees with critical skills leaving us for Do we provide the rewards desired Does our organizational structure create
It is very difficult to source talent segments effectively? we prioritize to develop critical skills? and successors? our competitors? Why? What is it costing us? by employees with critical skills? barriers to attracting and retaining employees
and/or develop the critical with critical skills?
capabilities the organization
Sample Metrics Sample Metrics Sample Metrics Sample Metrics Sample Metrics Sample Metrics
needs. ■■ Labor market availability ■■ Competency assessment scores ■■ Leadership competency assessment ■■ Voluntary turnover rate ■■ Perceptions of pay fairness ■■ Satisfaction with job design and role clarity
■■ Source of hire ■■ Training satisfaction/application rate scores ■■ Top reasons for departure ■■ Benefits satisfaction index ■■ Average span of control

■■ Talent pipeline quality ■■ Training channel mix ■■ Employee satisfaction with leadership ■■ Turnover cost ■■ Benefits, compensation, and total rewards

■■ Business unit performance benchmarks


Competitive Talent Markets: Do we have a competitive EVP compared Do we accurately identify our top talent? Do we provide sufficient opportunities for Is our top talent leaving us for our Do we provide competitive, differentiated Does our organizational structure create
The organization is battling to peer organizations? advancement to our top talent? competitors? Why? What is it costing us? rewards to our top talent? barriers attracting and retaining top talent?
with competitors to attract and
retain top talent.
Sample Metrics Sample Metrics Sample Metrics Sample Metrics Sample Metrics Sample Metrics
■■ Quality of candidate pool ■■ Performance ratings ■■ Promotion rate ■■ Voluntary turnover rate ■■ Perceptions of pay fairness ■■ Satisfaction with job design and role clarity

■■ Conversion rate ■■ Promotion success rates ■■ Average time to promotion (compared ■■ Top reasons for departure ■■ Pay differentiation ratios ■■ Average span of control

■■ Competitor EVP analysis ■■ Percentage of successors sourced from the to employees expectations) ■■ Turnover cost ■■ Benefits, compensation, and total rewards

HIPO pool ■■ Career path satisfaction benchmarks


Limited Talent Mobility: Our Do we have sufficient talent mobility? What How do we minimize performance disruption Are mobility barriers putting bench strength Are highly engaged employees more mobile What benefits would encourage greater Does the organization’s structure create
staff are unwilling or unable to are the most common barriers to mobility? surrounding employee moves? at risk? than other employees? mobility? barriers to mobility?
move into new roles across the
organization.
Sample Metrics Sample Metrics Sample Metrics Sample Metrics Sample Metrics Sample Metrics
■■ Internal:external hire ratio ■■ Average performance ratings of ■■ Bench strength ■■ Engagement scores ■■ Internal rewards benchmarks (internal ■■ Satisfaction with job design and role clarity

■■ Internal mobility policy benchmarking transitioning employees and teammates ■■ Successor pool coverage ■■ Transition success rate equity) ■■ Average span of control

■■ Internal transfer engagement ■■ Positions with ready successors ■■ Benefits, compensation, and total rewards

benchmarks
Emerging Critical Skills: Do we effectively hire employees What development interventions are needed How will anticipated strategy and Are employees with emerging skill sets Do we provide competitive rewards Do structural barriers hinder the
Changes in technology, with emerging skill sets? to build emerging skill sets? environmental shifts impact future leadership leaving the organization? Why? What is to employees with emerging skill sets? demonstration of emerging skill sets?
industry dynamics, legislation, requirements? it costing us?
etc produce rapidly changing
Sample Metrics Sample Metrics Sample Metrics Sample Metrics Sample Metrics Sample Metrics
skill requirements for the ■■ Quality of hire ■■ Competency assessment scores ■■ Competency assessment scores ■■ Total/voluntary/involuntary turnover ■■ Perceptions of pay fairness ■■ Satisfaction with job design and role clarity
organization’s workforce. ■■ Hiring needs analysis ■■ Training satisfaction/application rate ■■ Bench strength ■■ Top reasons for departure ■■ Benefits, compensation, and total rewards ■■ Average span of control

■■ New hire failure/turnover rate ■■ Training channel mix ■■ Engagement scores benchmarks ■■ Competency assessment scores

Pending Retirements: Do we have a sufficient pipeline of external Do we have the capabilities we need to cope Do we have the talent bench we need to What is the impact of pending retirements on How do long-term benefits for retirees impact What are the structural solutions to help us
A significant portion of the hires to replace pending retirees? with pending departures? fill anticipated leadership vacancies? the engagement of the remaining workforce? future benefits for current employees? cope with large scale employee departures?
organization’s employee base
will retire within the next 5–10
Sample Metrics Sample Metrics Sample Metrics Sample Metrics Sample Metrics Sample Metrics
years. ■■ Labor market availability ■■ Competency assessment scores ■■ Bench strength ■■ Engagement scores ■■ Benefits satisfaction index ■■ Average span of control
© 2014 CEB. All rights reserved. HRFR9293614SYN ■■ University hiring volume ■■ Training satisfaction/application rate ■■ Successor pool coverage ■■ Productivity scores ■■ Benefits benchmarking

■■ Talent pipeline quality ■■ Learner performance improvement ■■ Transition success rate  31
■■ Performance ratings

Disengaged Key Talent Do we have a competitive EVP compared How do the development needs of particular Is our successor pool sufficiently diverse? Are particular segments more likely to leave? What rewards strategies drive engagement? Does our organizational structure create
Segments: to peer organizations? segments impact our training portfolio? Why? What is it costing the organization? barriers to attracting and retaining particular
Key segments (e.g., “Gen Y”, employee segments?
Sample Metrics Sample Metrics Sample Metrics Sample Metrics Sample Metrics
hourly employees, and women ■■ Quality of candidate pool ■■ Competency assessment scores ■■ Successor pool diversity ■■ Benefits, compensation, and total rewards Sample Metrics
and minorities) are disengaged. ■■ Total/voluntary/involuntary turnover
■■ Competitor EVP analysis ■■ Training success/application rate ■■ Transition success rates benchmarks ■■ Satisfaction with job design and role clarity
■■ Top reasons for departure
■■ New hire failure/turnover rate ■■ Training satisfaction rate ■■ Bench strength ■■ Perceptions of pay fairness ■■ Average span of control
■■ Turnover cost
■■ Turnover rates (associated with

dissatisfaction with rewards)

Source: CEB analysis.

© 2014 CEB. All rights reserved. CLC5841813SYN

 31
WHAT ARE YOUR KEY LEARNINGS FROM TODAY’S SESSION?

Recap of Today’s Session


■■ Understanding Talent Metric Evolution
■■ The Blend of Analytics on the Business Environment
■■ Tools (Gap Prioritization Questions, Heat Map)

Key Learnings
■■ Think carefully about metrics selection
■■ Take into account the business needs of a metric
■■ Take those ad-hoc requests and streamline them to meet the business

© 2014 CEB. All rights reserved. HRFR9293614SYN

 32
Appendix

© 2014 CEB. All rights reserved. HRFR9293614SYN

 33
100 HUMAN CAPITAL QUESTIONS

Workforce Demographics and Diversity 13. Is the ROI on Human Capital higher than the ROI on working capital,
invested capital or plant and equipment?
1. What percentage of our workforce will retire in the next year or next five
years? 14. In the last five years, has workforce productivity increased, decreased
or remained the same? What is our relative performance against
2. What is the average age in our organization? In the last five years has
competitors’?
it increased, decreased, or remained the same?
15. What is the average time-to-full-productivity for new hires? How does
3. What is the average organization tenure? In the last five years has
this compare to median tenure within our organization?
it increased, decreased, or remained the same?
Workforce Health & Safety
4. What is our ratio of managerial to non-managerial staff? In the last five
years has it increased, decreased, or remained the same? 16. How many workplace injuries per 100 employees occur on an annual
basis? How does this compare across our locations and within our
5. What is our ratio of customer-facing or revenue-generating staff to
industry?
back-office staff? In the last five years has it increased, decreased, or
remained the same? 17. How many health and safety incidents occur per one million hours
worked? How does this compare across our locations and within
6. What percentage of our current managerial positions are occupied
our industry?
by women or minorities? How does it vary across our lines of business?
18. What is the dollar cost impact of short- and long-term disability
7. What percentage of our identified successor pool are women
absences and claims?
or minorities?
8. How many part-time, temporary, or contract employees exist across Workforce Relations and Satisfaction
our organization? What business units rely on them most heavily? 19. What percentage of our employees are fully engaged and are “doing
their best work” at all times? How does this vary across functions and
Workforce Productivity
lines of business?
9. What is our revenue per employee? Is it higher than our competitors?
20. What percentage of our employees would say they are committed
How does it vary across lines of business or geographies?
to the organization? Why are they committed?
10. How does our head count per unit of production compare to that
21. How many of our employees have applied for positions outside
of our direct competitors’?
the company in the past six months?
11. How many dollars of operating profit are generated for every dollar
22. How many EEO complaints or lawsuits are filed annually?
invested in compensation and benefits?
23. What do we incur in legal costs to arbitrate, defend, or otherwise resolve
12. What percentage of every dollar of operating expenses is invested
complaints and lawsuits?
in compensation and benefits?

Source: Successfactors.

© 2014 CEB. All rights reserved. HRFR9293614SYN

 34
00 HUMAN CAPITAL QUESTIONS (CONTINUED)

Workforce Turnover and Mobility Workforce Planning


24. What percentage of our workforce moves internally each year between 38. Are we over-staffed?
lines of business or functional areas? 39. Are we under-staffed in areas, where if we added people, we would
25. What is our average position tenure? increase our profitability?
26. What percentage of our workforce is promoted annually? How does this 40. What is the magnitude of competency “gaps’ between needed and
compare across demographic segments and lines of business? actual capabilities?
27. What is the average time between promotions? How does this compare 41. What is the ratio of internal to external hires to balance institutional
across demographic segments and lines of business? knowledge with fresh ideas?
28. Which lines of business or managers have the highest voluntary turnover 42. What percentage of our “critical roles” are staffed with below-average
rates? Is this a persistent or recent phenomenon? performers?
29. Which lines of business experience the greatest annual “knowledge loss” 43. What percentage of key positions have identified successors?
from terminations, transfers, and promotions combined? 44. What is the depth and quality of the successor pool for key positions?
30. Which lines of business or managers are the best developers of talent 45. What percentage of our high performers are at high risk for departure?
as measured by the promotions out of their department?
46. Where in the organization are our high performers concentrated? Where
31. Which lines of business or managers are magnets for high potential are there very few? Is this by design?
employees as evidenced by their transfer rate into various departments?
47. Are our highly experienced and skilled talent deployed in positions
32. What is our voluntary turnover rate among key executives? What requiring their skills? Could any of these positions be staffed with less
are the associated costs to the business? experienced talent?
33. What is our voluntary turnover rate among top performers? What Staffing and Recruiting
are the associated costs to the business?
48. What is our employment brand strength among prospective employees?
34. What is our voluntary turnover rate among individuals in critical roles?
What are the associated costs to the business? 49. Do our new hires continually increase the overall quality and productivity
of our workforce?
35. What is our voluntary turnover rate among all individuals in hard to hire
positions? What are the associated costs to the business? 50. What percentage of critical roles are unfilled as of today?

36. Do we retain our key/most productive people at a higher rate than 51. What percentage of our first choice candidates accept our offers?
our best competitors? 52. Which recruiting sources provide the highest-performing employees?
37. What is our involuntary termination rate? What percentage of these 53. How deep is our pipeline for positions known to be hard to replace?
actions are due to poor performance?

Source: Successfactors.

© 2014 CEB. All rights reserved. HRFR9293614SYN

 35
100 HUMAN CAPITAL QUESTIONS (CONTINUED)

54. How does the performance of our new hires in their first six months vary Workforce Compensation and Benefits
by recruiter or hiring manager? 70. What is the percent increase in employee performance as the result
55. What percentage of applicants exceed the qualifications of our best of every one percent increase in pay?
current employees? 71. How much differently do we pay our top contributors from our average
56. What percentage of our employment offers are accepted? How does contributors? Is this in proportion to their contribution?
this vary by gender, ethnicity, EEO category, or salary band? 72. What percent of total compensation is tied to performance?
57. What percentage of new hires leave voluntarily in the first six months? 73. How much higher or lower are our new hire salaries compared to others
58. What percentage of new hires are terminated in the first six months? in our industry?
59. What is the dollar cost impact across recruiting, training, and lost 74. What percentage of total compensation is direct compensation versus
productivity for each early-tenure departure? benefits? How do employee perceptions of this split compare to the
actual figures?
60. What percentage of interviewees do hiring managers deem unqualified
and not worth their time? 75. Based on our workforce demographic, could we be offering a benefits
package that is both more attractive and less expensive than the current
61. Is the recruiting pipeline appropriately diverse to ensure diversity in hires
offerings?
and the overall workforce?
76. Has our stock options program added to or diluted our share’s value?
62. How accurate are our pre-employment tests in predicting the quality
of a hire? Workforce Training and Development
63. How many inquiries or applications do we receive per open position? 77. Is there a correlation in our organization between the percent
64. What percent of referred applicants are hired? of all people costs spent on training and firm profitability?
65. Do referred applicants perform better, worse, or the same as non- 78. What is the percent increase in performance as a result of every $1,000
referred applicants once on the job? spent on training?
66. What percent of recruitment sources are evaluated and dropped 79. What percentage of poor performers become good or better performers
for newer more effective sources annually? within a year, as a result of our individual development efforts?
67. What is our time-to-fill by job grade and geographic location? 80. What percentage of underperforming managers turn around their
performance by the next review period?
68. What is our cost per hire? As this figure rises or declines does new hire
quality follow suit? 81. What percent of trained individuals are observed to use the skill
or knowledge on the job?
69. What percent of above-average performers are still with the firm after
one year? Three years? Ten years? 82. How does the performance of employees participating in optional
training programs compare to those not participating?

Source: Successfactors.

© 2014 CEB. All rights reserved. HRFR9293614SYN

 36
100 HUMAN CAPITAL QUESTIONS (CONTINUED)

83. How many dollars are spent annually per individual on training and 96. What percentage of HR programs actually achieve the ROI stated
development? How does this compare against our key competitors? in their business case or project proposal?
84. Do longer tenured employees continue to grow via training, or is training 97. What percentage of HR programs are discontinued every year for failing
disproportionately offered to, or attended by, newer employees? to achieve interim targets or meet expectations?
85. What percentage of managers gladly send employees to training 98. How many early warnings does HR communicate to line managers? How
sessions? Which courses are recommended by managers or fill quickly? many are accompanied by recommendations for heading off the rising
problem?
86. How have leadership development programs impacted productivity,
profitability, or employee satisfaction? 99. What are the avoided costs from timely HR interventions, whether
identified by HR or line managers?
87. What percent of employees identified and possible managerial
successors attend leadership development sessions? 100. What is the ROI of our daily HR activities?
88. How much weight in manager’s variable pay or performance reviews
is given to employee development?
89. What percentage of employees have an individual development plan
created for them?
90. What percentage of employees complete the recommended steps
on their development plan?

HR Function
91. What percent of all corporate spending goes to HR? How does
it compare to last year and our best competitors?
92. Does adding more or higher quality HR resources make a direct top-
or bottom-line impact?
93. What percentage of all HR employees have work experience in a line
of business?
94. How do employees rate their satisfaction with HR’s transactional
services?
95. How do employees rate their satisfaction with HR’s consultative (value-
added) services?

Source: Successfactors.

© 2014 CEB. All rights reserved. HRFR9293614SYN

 37