December 3, 2013
Peter Drucker’s old adage that ‘what gets measured gets managed’ may be a cliché, but it’s endured to become one because there is a lot of truth in it. Now a new report commissioned this year by recruitment consultants Alexander Mann Solutions and the HRO Today Institute has found that firms that use employee data to inform strategic decision making outperform their competitors around 58 percent of the time. Which is great except the survey of HR managers and directors at over 300 companies also found that only a third of businesses use data in this way. This is in spite of the fact that nearly all (90 percent) of companies acquire employee performance data. According to the report, Success: How metrics & measurement correlate with business, nearly a third don’t use the data in any way whatsoever.
The report is based on a survey of 380 HR managers and directors which was carried out by recruitment consultants Alexander Mann Solutions and the HRO Today Institute between May and September of 2013. Certain types of data acquisition are more commonplace than others. Nearly three quarters of respondents (73 percent) acquire employee appraisal data, followed by new hire retention new hire retention (55 percent) and customer satisfaction (50 percent). At the other extreme, companies least regularly collect data on the speed at which new hires are promoted (13 percent) and profit generated per employee (24 percent).
The main barriers cited to effective data acquisition and use by the survey’s respondents include inadequate IT systems capable of collating, analysing and ensuring the consistency of data across regions and divisions; limited resources in the HR department; and a lack of accountability and discipline in implementing data acquisition and use.
“The link to the bottom line can be significant,” said Jerry Collier, global director at Alexander Mann Solutions. “Our research demonstrates that even companies that may have a culture of disciplined data analysis do not necessarily have the boardroom backing to integrate that practice into their talent acquisition and management processes. However, those that do are reaping the benefits and winning market share in their industry sectors.”