The War for Data Talent Invades the HR
By Kelley Pearson,
Vice President, TD Madison & Associates
signal is the truth. The noise is what distracts us from
Nate Silver, ESPN
I attended an interesting event back
in April called “Tech IT Out” hosted by the
WICT (Women in Cable Telecommunications) Carolinas Chapter.
The topic was The Power of Data. A moderated
panel provided a lively and very informative discussion
about how data drives a vision of economic and technical
innovation in their organizations; how data can be a true
game changer. I came away from that meeting with a lot
of information, numbers, predictions and even warnings.
One of the panelists said something that stuck with me,
and as I recall she said it several times during that
discussion: “Done is better than perfect.”
What she meant was that companies have to do something;
they cannot wait until everyone is comfortable with big
data because by then it will be too late. Plenty of data
is coming in. But collecting it and storing it is just
a step. The data has to be analyzed so that it can be
used in an actionable way that drives desired business
outcomes. “Done is better than perfect.”
It reminded me of the classic response to someone who
says she or he isn’t ready to have a baby yet: “Oh,
but if you wait until you are ready, you’ll never
nuggets I heard that day: 80% of companies analyze their
data, but only 25% of that 80% derive any strategic value
from it. Thirty-three percent say they need to develop
a strategic plan for it — policies, procedures and
infrastructure. Governance. This is when people get hesitant
about moving forward.
Chances are that you, the HR executive, have already had conversations with other business leaders in your company about the need for data talent, either immediate or in the near term. Are you looking for a data scientist? Will that person be reporting up to a senior IT leader or marketing? The competition is fierce for this talent. The Googles and Facebooks of the world are offering whatever it takes to get them on board. Last year, the Harvard Business Review named data scientist as the “Sexiest Job of the 21st Century.” Accenture’s research says there is a critical mismatch between supply and demand for analytics talent—the people with the ability to use statistics, quantitative analysis and information modeling techniques to make business decisions.” And the HR department needs this talent, too.
This new type of human resource, a data-savvy, analytic leader, is a hybrid, combining four types of professionals into one: business-person, people-person, statistics-person and an information technology person. Finding someone with all four of these traits is very challenging. This hybrid leader is not only able to solve problems, but just as importantly, find the unsolved problems. HR professionals have been collecting data for a long time, keeping records of employees’ personal information, compensation histories, performance reviews and retirements; but that data needs interpretation. This is not the analytics manager who is benchmarking and tracking efficiency metrics, like time-to-hire. Scorecard metrics and benchmarks are important, but these activities are not the same as analyzing data and showing its business value: connecting process and outcomes.
What are the goals in HR leveraging big data?
- To understand the past and present, and then to predict the future, basing all of these insights on facts and data
- To conclusively articulate the direct impact and value of HR processes and initiatives (the people data) on important business outcomes.
In the article “Moneyball
& The HR Department,” The Wall Street
Journal reported: “The Human Resources department
is known for being touch-feely, but in the age of big
data, it’s becoming a bit more cold and analytical.
From figuring out what schools to recruit from, to what
employees should be offered flexible work arrangements,
data analytics are helping HR professionals make more
Josh Bersin, Principal and Founder of Bersin by Deloitte, says that the big data revolution is now penetrating the HR industry, and while some companies have a progressive view of how data analytics can help HR departments, most don’t. Other sources report that fewer than 18% of business leaders trust talent data and insights coming out of HR, and 80% of those leaders believe their HR staff does not have the skills to improve their analytic capabilities.
This critical need for talent was further validated by a panel discussion hosted by Georgetown University’s Human Resource Management program. The panel members agreed about the disparity between what is needed and the skills that currently exist in a typical HR organization. The program’s Senior Associate Dean Christopher Meltzer, Ph.D., talked about how HR personnel need to be as “competent in discussing data as they are in addressing typical HR topics like recruitment and retention.” Another panel member Lee Webster, Director of HR Standards at the Society for Human Resource Management (SHRM), stated, “The HR professionals of the future have to recognize that the only way we can make compelling, lasting change in organizations is not only that we’re very good with the qualitative part of our roles [but] we have to be able to speak in terms that are compelling on the quantitative part of our roles.”
What skills do effective HR analytic leaders need?
- To be constantly curious
- To be highly capable of discovering patterns and finding relationships in complex data
- To know the difference between correlation and causality
- To be able to tell stories with the data
- To be able to connect their work directly to boardroom priorities
- To possess a combination of business acumen and understanding of models along with analytical skills to interpret the information
- To be able to envision what might be, with the ability to build scenarios and queries to investigate that hypothesis, and to communicate this to the company leadership in language that makes sense to them, i.e., business language, not “HR” language.
How do you attract this talent into HR analytics?
Get competitive! Start talking about it. “Done is better than perfect.” It won’t transform overnight into the dream job, but momentum can begin. Start small. Start with the position description and the title. The compensation structures need attention. HR organizations don’t typically pay as much as marketing or finance organizations for their analytic talent. Candidates aren’t exactly lined up at the door for these positions. Further, companies do not do a great job of selling this opportunity. Prospective candidates need to become aware of the exciting nature of the work and the participation in formulating key elements of a company’s strategy.
Some research suggests that giving HR
analytics team members a seat in the corporate boardroom
will increase a company’s chances of recruiting
high-level analytics talent. Christopher Collins, Professor
and Director of Cornell University’s Center for
Advanced Human Resource Studies, stated, “It says
a lot about a company when [it has] an analytics person
who is a direct report to the Chief HR Officer. That sends
a strong signal as to the value and importance of analytics
as opposed to just embedding it deeper in another function.”
Key stakeholders need to understand the value of HR analytics
and how using science in the selection, management and
alignment of people can be applied to specific lines of
business, ultimately enabling executives to make better
Care Act: Where the Rubber Meets the Road
This article features transcript
excerpts from CTHRA’s session at the 2013 Cable
Show. Panelists included Matthew Eurey,
VP of Benefits for Time Warner Cable; E.J. Holland,
Jr., Assistant Secretary for Administration
at the U.S. Department of Health & Human Services;
Karen Salinaro, FSA, Account Director for Towers
Watson, and Jeffrey E. Shapiro, Vice
President of Enterprise Benefits for The Walt Disney Company.
Workforce composition, Cadillac plans and market exchanges all generated a lively discussion at CTHRA’s panel on the Affordable Care Act, held earlier this summer at The Cable Show. The panel, moderated by Kristen Welker, NBC News White House Correspondent, clearly communicated that in spite of uncertainty over some aspects of the act, cable’s HR professionals are assessing their plan designs, costs and employment pools in preparation for the act’s 2014 implementation.
your workforce and who really works 30 hours a week is
essential, as that’s the threshold for healthcare
coverage. Calculating employee hours can be complicated
for companies that use seasonal workers, production/studio
resources and third parties who haven’t always been
considered direct employees and eligible for benefits.
Jeffrey Shapiro, VP of Enterprise Benefits for The Walt Disney Company, likens this to “counting belly buttons.” “No matter how many jobs you have, you still have just one belly button. We’ll find out all the hours that you work, and then determine the offer from that standpoint.” Shapiro said.
Part-Time Labor Not a Panacea
To lessen costs, some have speculated that employers will simply hire part-time workers (29 hours and under). Karen Salinaro, FSA, Account Director for Towers Watson, cautioned the audience that it’s not just about tracking hours, but rather about workforce composition and the appropriate mix of part-time and full-time labor.
“Having one full-time employee working 30 hours is not equivalent to having two part-time employees working 15 hours,” Salinaro said. “They are different kinds of employees. They are engaged at different levels and turn over at different levels, so the cost is very different…. A lot of these decisions that companies need to be making are really operations decisions.”
Cadillac Plans and Excise Tax
CTHRA’s panelists agreed that their companies’ healthcare plans already meet the act’s actuarial and affordability requirements. But one area of concern is with so-called “Cadillac” plans — feature-rich plans that exceed $10,200 for individuals or $27,500 for family coverage. In 2018, plans that fall into these categories will be subject to a 40 percent excise tax on amounts over the threshold.
“Historically we have made our benefits a bedrock of our total rewards strategy,” said Matthew Eurey, VP of Benefits for Time Warner Cable. “If healthcare costs remain at historical levels, we forecast that we will penetrate the thresholds that have been laid out.”
“The way you avoid the excise tax is twofold,” continued Eurey. “You can make changes and lower the designs, or you can make your population healthier. We are attacking it in both of those fashions. We are doubling down on all of our strategies in the wellness space.”
One of the Affordable Care Act’s big unknowns is
the developing “marketplace” or “exchange”
where individuals and eventually employers can assess
plan design, costs and potential government subsidies
and purchase coverage. Run by states, or the federal government
those states opting out, enrollment via the marketplace
starts this fall for individuals, with coverage beginning
in January 2014.
Although large employers won’t initially be able to purchase employee healthcare insurance from the exchanges, they need to know what plans are available and how benefits and prices compare to what they offer, advised the panelists. The exchanges can serve part-time employees and may be right for lower-paid workers.
“The level of subsidy for lower-paid workers is really quite generous. Employees could actually be better off from a financial perspective if they were to be covered by the state exchange versus an employer plan,” explained Karen Salinaro. She added that employers need to explore the exchanges to understand rates in different states and how the cost of their plans for low-paid employees compares to that for marketplace plans — both subsidized and unsubsidized.
Disney’s Shapiro added that exchanges could also benefit companies with a nationwide workforce. “It certainly becomes a viable option in states where we don’t have a large enough presence to have purchasing power for our own plan,” Shapiro said.
Move to the Middle?
CTHRA’s members understand the power of medical plans as a tool to attract and retain employees. One audience member asked: “After a few years, will most employer plans move toward the middle?”
“I suspect there is something to that — a reduction to the mean,” said E.J. “Ned” Holland, Jr., Assistant Secretary for Administration at the U.S. Department of Health & Human Services. “There are certain things that we will require, and they will be covered. Preventive services. The 80/20 rule for medical/loss ratio, Medicare drug costs, kids up to 26. Everyone will have to meet those standards,” Holland said. “The potential tax on Cadillac plans will drive plans in the other direction, so a regression to the mean is likely.”
Time Warner Cable’s Eurey agreed.
“I expect that most employers will land where they
ultimately offer some form of light PPO and then a consumer-driven
health plan,” he said.
Disney’s Shapiro was nuanced in his agreement, adding
that while employers may seek ways to simplify their core
medical plan, they will find other ways to differentiate
themselves by promoting overall population health and
productivity. “For example, how much are [employers]
willing to put at risk for wellness or condition management
programs? How user friendly will they try to be in terms
of web sites or onsite services?” he asked.
“Remember that benefits are broader that healthcare,” added Holland. Speaking of his days at Sprint, he said: “We provided long-term health care coverage, voluntary benefits, vacation, holidays, time off. You have a lot of arrows in the quiver.”
“If [employers] can’t spend some of that Cadillac money on healthcare, maybe they’ll find a way to spend it on something else to distinguish themselves from their competitors for talent,” Holland said.
Communicating With Employees
All of CTHRA’s panelists agreed that employers need to be planning their healthcare communications strategies now. Workers will have questions, and while employers are waiting to see how marketplaces and exchanges will develop, they need to be poised to communicate to employees once concrete information is available. They also need to continue their ongoing dialog with employees about healthcare in general.
“We’re concerned that our employees don’t know the difference between a copay and coinsurance. We’re concerned that they don’t know where to seek care. They go to the emergency room when they have a cold. At this point, we’re tasked with educating them better and more broadly about the concepts of healthcare and how to best utilize the system,” said Time Warner Cable’s Eurey.
Communication is also important for companies seeking to avoid that Cadillac tax, added Disney’s Shapiro. “The way to do it is not just through a design where you increase your deductible and put people at risk for a large out of pocket expense up front, it’s really the information about how and when they seek care. All the little micro decisions they can make each day — generics over brand name, staying in network. Those are things that employers have been espousing for quite a long time irrespective of the healthcare reform legislation.” He urged companies to “stick to the message of being a smarter shopper and why pay more than you have to for good quality care.”
Seek Expert Help
Eurey also advised CTHRA members to identify their in-house experts and find outside support resources. “I have a staff of 10 folks. We can’t take 52,000 employee calls. I have concerns about the traditional means where folks have benefits questions answered by insurers,” explained Eurey. He suggested that companies think about where those calls can be fielded and find a vendor that can be your mouthpiece.
“Not only can they help with questions
about healthcare reform and its impact, they can also
help you to direct care,” said Eurey. “Those
are things you want to start now, so you can launch them