When you want to take your human capital analytics strategy to the next phase—isolating the impact of an investment and understanding how to improve it—Capital Analytics offers six key concepts. They are:
- Stakeholder buy-in
- Alignment
- Getting to useful data
- Segmentation
- Isolation
- Optimization
Over the next few months, we’ll explore these key concepts and show you how you can apply them to your analytics strategy. We begin with numbers one and two—Stakeholder Buy-in and Alignment.
1. Stakeholder buy-in
Ideally, stakeholder buy-in is best sought at the outset of planning for an investment. If you’re designing a new immersive sales training simulation, you’ll want to consult a few of your colleagues in the sales department—after all, they’re the ones sending their direct reports to the training and hoping to see a benefit from it. For a leadership development investment, consider who will feel the effects of the program—division managers perhaps? Beyond these specialty participants, involve representatives from finance, business operations, field operations, and IT analysts as applicable. Consider everyone who will be indirectly touched by the investment and whose cooperation you will need to obtain data.
But what if you didn’t get stakeholder buy-in before deploying the investment? Their participation in evaluation is still critical. You’ll also need their help to get the necessary data. Get all of the stakeholders together for a meeting to explain the measurement plan and get their input. You may be surprised how much you learn from their collaboration—for many companies, a measurement stakeholder meeting is the first time these particular individuals have been in the room together.
One of the biggest benefits of stakeholder buy-in is ensuring that the logic behind your study design will resonate with business outcomes. Not only will you hear about the stakeholders’ individual issues and concerns, but they can also tell you if the links between leading indicators and business results are accurate.
2. Alignment
Another thing your stakeholders can help you accomplish is aligning the investment with the organization’s goals. Again, it’s best to align while planning the investment, but don’t give up if the initiative is already underway. Ask the stakeholders how they see the initiative affecting their business concerns and metrics. Use the Measurement Map process as a basis for discussion.
Aligning people investments with business results is frequently called for, but not always easy to do. It can be difficult to think of something like a performance management process and relate it to profitability. Remember that there’s more to alignment than showing an ROI—alignment means showing how your investment impacted the business. Check out a case study from VF Corporation (parent of such apparel brands as Wrangler, The North Face, Vans, Lee, and nearly 30 others) to learn how the world’s largest apparel company aligned a new performance management process with the business.
Aligning the investment with business goals will also point to leading indicators of success. Leading indicators are particularly useful for investments that take a long time to show up in business metrics (such as a new performance management process). The leading indicators can tell you if you’re on the right track, in many cases pointing to early course corrections.
Join us next month for a discussion of Key Concepts 3 and 4: Getting to Useful Data and Segmentation.