“We need to think differently about the role of HR in business, and effectively using data and analytics to drive your business and talent strategies is now an imperative. If you’re trying to understand how you can use data and insights about your talent for real business results, this is the book to read. The Data-Driven Leaderdescribes practical ways you can use data to talk about your company’s most valuable assets—your people.”
—Kelly Palmer, Chief Learning & Talent Officer, Degreed
“The most effective leaders today are leveraging the incredible power of People Analytics to maximize talent in the organization. The Data Driven Leader is a practical guide for business leaders and human capital professionals to immediately make an impact with analytics. Dearborn and Swanson not only showcase where People Analytics can make the greatest difference, they include graphs, charts, checklists and step-by-step examples which can be put to use immediately.This is a must have resource for any leader of people.”
—Kevin Oakes, CEO, Institute of Corporate Productivity
“Dearborn and Swanson are keenly tuned into the traditional/stereotypical HR mindset and equally insightful about the data-based transformation needed to make more effective decisions and high-performing organizations. Data driven leaders of all functions experience greater cross-functional success when they begin with facts and master the art of drawing meaning from those facts.Every aspect of the internal and external customer experience will benefit from using data analysis to prioritize the ‘why’ above the ‘blame’ when solving problems.”
—Carol Goode, SVP & CHRO at Brocade
“The Data Driven Leader offers an engaging parable that brings to life the value of analytically-based people decisions, and helpful guidance for leaders to enhance those decisions.”
—Dr. John W. Bourdreu, professor and research director,
Center for Effective Organizations and Marshall School of Business,
University of Southern California
“The Data Driven Leader is a terrific call to action for HR leaders who want—and need—to be business leaders. Jenny Dearborn and David Swanson offer a thoughtful argument for why complex business and people challenges demand analytics-based solutions, and more importantly, they provide practical tools to make it happen. The future of work and HR is becoming increasingly analytics-based and multi-disciplinary in nature, with a value chain that is morphing from big data to better insights to business outcomes.”
—Ian Ziskin, president, Exec Excel Group LLC and former chief HR officer, Northrop Grumman and Qwest Communications
“Jenny and David bring to light the best practices for leveraging data to drive critical talent decisions within an organization.The concept of designing a data-driven people strategy is spot on. Human Resources teams are now on the hook for driving measurable business outcomes. This book provides the blueprint—a must read for any HR leader.”
—Michael Rochelle, chief strategy officer and principal HCM analyst, Brandon Hall Group
“I love the story-telling approach to analytical lessons that Jenny and David offer. Their knowledge of (and commitment to) people, systems and data converge here in a must-read book for anyone interested in the future of HR and Leadership. Even the non-numbers oriented, like me.”
—Bill John, president & CEO, Odyssey Teams, Inc.
“Effective leaders care about truth: the organizations that they really have, not the ones they think (or wish) they have. Moving a company forward requires patient and accurate insights into what people are really doing. This valuable book provides practical and clever tools for this analytical work, demystifying the application of data analytics to HR processes that serve the entire company.”
—Dr. Charles Galunic, Aviva chaired professor of Leadership, professor of Organization Behavior, INSEAD Business School, FRANCE
“We live in a world where data overload and data integrity is questioned every day. Rather than running away from it, we need to boldly step up. Consequently, the ability to synthesize information, analyze data and offer compelling insights and recommendations is one of the most critical skills required by the workforce of today. The HR function has the opportunity to lead and make a huge difference in this space. The Data Driven Leader is an easy-to-read, insightfulbook that provides great ideasfor practical application across manyparts of a business.”
—Karen Gaydon, SVP, CHRO and Corporate Marketing, Synaptics
“HR teams have a unique opportunity to transform how work is done through analytics, helping teams be more engaged and productive. The Data Driven Leader provides the real-life examples and practical tips you need to begin applying HR analytics that drive better people and business results.”
—Robert J. Milnor, head of Planning Analytics and Reporting,
Corporate Organizational Capability, Chevron
“One of the key questions for the future is the impact of artificial intelligence on human work. Here’s a great contribution to that debate. Jenny Dearborn and David Swanson, through engaging examples and in-depth analyses, show how data analytics can properly empower the workforce for the future.”
—Chris Anderson, head of TED
“You can’t build an organization where people want to show up if you don’t truly know your people and you can’t truly know your people if you don’t have a people analytics strategy in place. Start by reading this book!…. A truly valuable resource that will help business leaders make sense of what people analytics is, why it’s crucial, and how to go about building it into your organization. A must read!…. Jenny is one of the world’s top minds when it comes to data and people analytics. She has created a valuable resource that every business leader needs to read. If you want to build an organization that is prepared for the future of work then you need to do based on people data. Start by reading this book!”
—Jacob Morgan, author of The Employee Experience Advantage (2017), The Future of Work (2014) and The Collaborative Organization (2012), speaker and futurist
“The combination of story-telling, explaining concepts, and illuminating practical application is really quite compelling. This is an increasingly important space—the industry has been on a journey to embrace the available depth of information and transform it into a tool to help all aspects of our businesses. Jenny and David do an amazing job illustrating how modern data analytics can be applied to the HR function, and how this creates a broader impact to a company—empowering HR as a strategic asset to the business. They take a technology space that is relatively new and remove the mystery from it and make it understandable, tangible, and something that can be put into practice.”
—Quentin Clark, software executive, advisor, investor, limited partner
“One of the most profound changes in business today is the vast amount of people-related data we have to analyze. This book will help HR and line managers understand their opportunity to apply analytics to many of the people decisions we make every day.”
—Josh Bersin, industry analyst, principal and founder, Bersin by Deloitte
“At the heart of The Data-Driven Leader is a simple yet powerful insight: that the best way to unleash the collective power of an organization is to unlock the full potential of individual employees working in concert. By connecting data analytics with the rapidly evolving practice of human resources, Jenny Dearborn and David Swanson have created a guide to driving business value that every leader—and not just those in HR—should read.”
—Mike Prokopeak, vice president and editor in chief, Human Capital Media, publishers of Chief Learning Officer, Talent Economy, and Workforce magazines
“At the convergence of people and technology there exists a great opportunity for talent development leaders to shape the future of their organizations. Data analytics are key to that effort, and in this book Jenny and David provide a practical guide for how to measure what really matters and use the information to transform business.”
—Tony Bingham, CEO Association of Talent Development
“Opinions are interesting but insight based on data are what leaders really need. ‘What happened’ ‘Why did it happen?’ ‘What might happen?’ ‘What should we do?’ Answering these four questions effectively is what results driven leaders do. And more than ever, answering all four of them must be based on data and true insight; NOT just gut feel. Organizations are often data rich and insight poor. That state exists is because leaders often avoid the hard work of the hard work. Having the discipline and skill to run an insight driven business is just that: darn hard work. And the current expectation is that ‘Human Resource’ leaders (CHROs, CPOs, etc.) have the skill and tenacity to be data driven leaders in parallel to the same expectations for profit/loss leaders.
So how does a data driven Chief Human Resource leader act? Well in perfect timing to meet the needs of current ‘People Leaders’ everywhere, Jenny Dearborn and David Swanson have co-authored The Data Driven Leader. The book’s protagonist is a newly minted CHRO, Pam Sharp, and she leads a company transformation through the most thoughtful application of data. The authors do a superb job of demonstrating how Pam Sharp and her HR team navigate the most profound business challenges with insight. The narrative of the book gives us a story to embrace and hence specific examples to learn from. Buy The Data Driven Leader and benefit from the rich narrative. Pam Sharp takes you step by step through the world of insight development. She shows that what’s in the way is the way? Follow Pam Sharp and we all might find the better route to becoming true data driven leaders!”
—Lorne Rubis, chief evangelist, ATB Financial, Edmonton, CANADA
“The Data Driven Leader is an essential guide for leaders who want to navigate complexity with brilliance and win in the new game of work. This insight-packed book will show you how to ask the right questions, gather intelligence and enable your team to find the best answers.”
—Liz Wiseman, New York Times bestselling author of Multipliers and Rookie Smarts, founder, The Wiseman Group
“A good read for HR professionals planning to embark on analytics and don’t know where and how to start!I like how the book provided alternative perspectives to the performance indicators that HR departments are tracking currently and practical approaches to leveraging analytics to create solutions to add value to the business.”
—Aileen Tan, Group CHRO, Singtel, SINGAPORE
“Anecdotes or Analytics. The Data Driven Leader gives voice to this choice that we all make daily in our decision-making process to recruit and retain, motivate and mentor, top talent that will be the best fit for each of our organizations. Crisp, concise and compelling in her writing style, Jenny Dearborn delivers a book that—from cover-to-cover—is a must read for those of us determined to make a difference through the role of HR in our organizations.”
—Carl Guardino, president & CEO, Silicon Valley Leadership Group
Cover image: © John Lund /Getty Images
Cover design: Wiley
Copyright © 2018 by Jenny Dearborn. All rights reserved.
Published by John Wiley & Sons, Inc., Hoboken, New Jersey.
Published simultaneously in Canada.
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To my amazing husband, John Tarlton, and our awesome, nutty, brilliant kids. I love our crazy life. Servons, Jenny
To my lovely wife, Suzanne Swanson, who supported, reviewed, and encouraged all the way, and to our seven fantastic children. Cheers, David
We are so thankful and lucky to have assembled a fantastic team of talented professionals to support this book project.
In today’s workplace, the pace and nature of change are simply unprecedented. So much of what we know about jobs and work is shifting beneath our feet due to powerful forces like robotics, big data, artificial intelligence, the Internet of Things, the sharing economy, the gig economy, and others. World Economic Forum Founder Klaus Schwab calls this the Fourth Industrial Revolution, with technologies so transformative that they are challenging what it means to be human.1
It is urgent that we human resource professionals step up our game in response, and effectively prepare for the future. With 47 percent of jobs currently performed by humans potentially eliminated as early as 20302 (or 50 percent of work activities disposable right now, according to a more dire prediction3), we must change the way we think and work. Our profession has evolved from administrative experts in Personnel or Industrial Relations to today’s top CHROs—key executives driving measurable business performance. We are encouraged by our collective progress, but also know that HR has much further to go.
Embracing data analytics is key to advancing as a profession and successfully transitioning our organizations into the future. Josh Bersin, a foremost HR thought leader, identifies people analytics as a top HR development: “This new function is critically important and of very high value—just as marketing departments analyze the results of campaigns, create personas and segments of the customer population, and understand the drivers of market share success, we can now do the same thing for our employees.”4
It is challenging but essential to change our mindsets. Intuition and emotional intelligence, once the hallmarks of successful CHROs and HR professionals, are no longer sufficient. We must now be anchored in data and analytics. But this is good news! Integrating a new analytical approach into our work will make our key capabilities even more powerful. We can deepen our ability to determine root causes and predict the outcomes of programs, not just oversee their implementation.
Whether you seek practical approaches to beginning your analytics journey or additional insights to further develop your analytics efforts, this book is for you. Our goal is to inform, motivate, and inspire you to combine the power of data and analytics with your HR expertise, thus enabling you to more effectively use your organization’s most precious resources: your people’s time and energy.
Studies show that, although many CEOs feel talent is a top competitive differentiator, an increasing number aren’t sure they have the employees they need to succeed now or in the future.5 Worse yet, they don’t feel their human resources organizations are equipped to help.6 It’s no wonder we see more CHROs replaced by executives from marketing, operations, or finance—disciplines that have been using data and analytics for years to drive their operations and outcomes. We must rise to the challenge, designing data driven people strategies, and the programs to achieve them, as catalysts for change and transformation.
This starts with changing how we think about metrics and measurement. Too much HR reporting uses only descriptive analytics, which capture what has happened: number of people hired, time to fill requisitions, and employee engagement scores are all examples of these “rear view mirror” metrics. We need to move toward diagnosing the “why” behind these metrics, using diagnostic analytics, or, in the case of predictive analytics, what might happen. Once we quantify these metrics, we can act, guided by prescriptive analytics.
Moving from simple reports to predicting the future is a crucial journey we all must take, and the time to start is now.
Here’s an example. You want to improve hiring results. Your best hiring managers reliably bring in high performers who become more productive more quickly than their peers. You want to identify what those hiring managers do differently and train your other people managers to do the same. How can you build a business case for such an endeavor?
Here’s one approach. Partnering with an analytics expert, your finance team and a line of business such as sales, measure the benefits of hiring stronger candidates (for example, faster time to productivity, higher sales, lower attrition) versus the costs of weaker hires. Then, studying the profiles of top performing hires, predict what kind of job candidates will be most successful. Finally, using prescriptive analytics, introduce a program designed to hire people who are X percent more likely to stay, Y percent more likely to reach productivity faster than the average hire, and provide a Z percent higher level of customer satisfaction than the average hire. This approach and these data position your training program for hiring managers as driving business performance, a language every executive speaks.
Throughout this book, we introduce business challenges like the hiring example above, then propose business solutions using sound human resources practices coupled with analytics. While reading The Data Driven Leader, imagine the possibilities for people analytics at your company.
To make this book accessible, enjoyable to read, informative, and practical, we begin each chapter with a fictional narrative, based on analytics programs we and our teams have developed. We then offer insights and practical suggestions related to that chapter’s plot in a commentary section. The fictional company, Exalted Enterprises, represents a realistic composite of the many organizations we have come to know over our careers, including Borland, Business Objects, Chevron, Hewlett-Packard, Interwise, KPMG, Kroger, Microsoft, Motorola, Nordstrom, Oracle, Salesforce.com, SAP, Starbucks, SuccessFactors, Sun Microsystems, T-Mobile, Verizon, and others. As a result, you will likely be able to relate to the concepts, themes, issues, challenges, and characters.
You may identify with our fictional protagonist, Pam Sharp, the new chief human resources officer of Exalted, as she helps turn around her company amidst intense pressures. You’ll likely recognize colleagues, past or present, in Elke, Marcus, Martha, and Sameer, Pam’s leadership team. We aim to portray an organization and a team like yours, which, with the application of people analytics, will hopefully experience similar triumphs.
Although the approaches they take are applicable to any aspect of a business, we focus on sales because about 80 percent of any company is typically involved with some aspect of sales, so a sales-focused initiative will usually attract significant buy-in across the organization. Once you have implemented people analytics for sales, you can replicate your initiatives in other areas.
The book that inspired this one, Data Driven: How Performance Analytics Delivers Extraordinary Sales Results,7 also stars Pam Sharp, who leverages analytics to understand and triumphantly overhaul sales at Trajectory, an Exalted subsidiary. The Data Driven Leader brings Pam back as Exalted’s CHRO, using HR analytics as a prism through which to view the ways data can transform how leaders think about and solve business challenges.
Dive in and discover the world of analytics. Use data to drive measurable business outcomes, prepare the workforce of the future, and be a key participant in driving the strategy and sustainability of your organization.
As Mark Twain is often quoted: “The best way to get ahead is to get started.” We hope this book will inspire you to start or to energize and advance the work you have already begun.
We wish you tremendous success.
Jenny Dearborn and David Swanson