Digging into big data
What can organizations learn from RBC’s data analytics journey?
By Liz Bernier
In an organization with more than 70,000 employees, there’s certainly no shortage of data — the challenge is what to do with it.
For RBC, that challenge has manifested in a data analytics journey that’s been a collective effort from a lot of people, according to Robert Carlyle, director of strategic workforce management at RBC in Toronto.
But there’s really no better time to reinvent the use of data within organizations, said Carlyle.
“There’s really three underlying trends that make this a great time to be reinventing people management and use of data. The first is really a larger conception around the analytical enterprise, and really analytics are how we’re changing the way how all organizations manage themselves,” he said at a Strategic Capability Network event in Toronto.
Some organizations are focused on collecting and using their own data internally, while others are turning to external research — and there’s no one way, he said.
“It can be with your own data, it can be with external research… (but) really that evidence-based people management is a coming trend, not just to use your own data, but to use findings that other people have where they’re credible and applicable to your organization.”
Big data is no longer just something that’s nice to have — it’s becoming the business standard, said Carlyle.
“We need to start to look at analytics as the way we do business — not as a series of projects. There’s a tendency in the past where, if we’ve got a problem, we’ll bring an analyst in to look at it. And it’s more of a project-based start and stop. There are a number of reasons that’s not the best approach to continue on.”
Another important driver is that the value of people to an organization in terms of the creation of value is much higher than it’s been in the past, said Carlyle.
We currently are in the fourth industrial revolution, according to the World Economic Forum, which means not only are skills changing, but the value of people within organizations is changing as well, said Carlyle.
“What we’re seeing, and we’re seeing it certainly in financial services, is that routine work is becoming more and more automated. Customers, clients can interact with people in different ways; the routine work becomes available on a mobile phone. You don’t even need to go into a physical premise,” he said.
“What happens is that people are there for issue resolution, they’re there for the complex, they’re there to provide advice, guidance, develop new product or to create these incredibly sophisticated automated systems. And with that, it’s more and more important that we have the right people in (the right roles).”
These are higher skill sets, more complex skill sets, and the development timelines are higher, he said.
“So how do we plan for this, given that people are more and more the drivers of value? We can’t rely on physical capital or financial capital, but intellectual or human capital is really the primary driver of organizational value.”
The third — and maybe most technical — driver of why this is an important journey is that people data and people analytics are actually cost-effective, said Carlyle.
“Relative to the value, which is going up, the cost is actually going down,” he said. “Storing data has become ridiculously inexpensive. We’re in the process of building a data warehouse, and we built a small facility, and we do get some scale efficiencies at RBC — I won’t deny that. But we’re looking at putting five years of every piece of people data we’ve got together.”
The average observer might imagine this would be an enormous expense — but it will actually end up costing RBC about $120 a month in total, he said. However, there is still the collection of data and other costs.
So, with those trends in mind, how did RBC go about implementing its capital analytics journey?
There were three key components: leadership support, infrastructure investment in people, technology and process, and improved decision-making, said Carlyle.
“As the infrastructure investment builds up, you need to improve the decision-making and give proof back to the leaders that there (are results),” he said.
RBC had to fit its analytics across a number of different businesses in different countries, all with different staring points.
Each unit was in a different place in terms of not only HR’s role with the business, but also in terms of the views around how people should be managed, so that had to be taken into consideration, said Carlyle.
There are also a number of areas to consider when making decisions around collecting data. For instance, one area is around reporting routines — should they be more ad hoc or more systematic? said Carlyle.
Another area to consider is around data aggregation.
“We made a decision fairly early that we want to be fully consolidated in terms of (data aggregation). There’s a number of reasons for that that aren’t necessarily obvious. The first is that it’s ultimately cheaper in the long run, and that matters. But the deep analytics are often less interesting than connecting different data sources together,” he said.
For instance, RBC is in the process of combining employee data points with customer data points around loyalty and likelihood of recommending the organization (called net promoter scores).
It is combining that with employee data, engagement scores, environment, demographics, management information and more.
“We didn’t need enormous reams of data, we weren’t using real-time data analytics… these were fairly basic employee data that most organizations would have. But you put those together and some real magic can be had, so we can actually direct managers on the front lines,” he said.
And while it’s still early in the process, RBC has already been able to see an impact on customer loyalty, said Carlyle.
“There are a few branches that have these (changes) in place, and they are outperforming other branches materially.”
Potential of analytics not yet there
By Michael Clark
Analytics, the darling of our age, has the potential to be the driver of organizational effectiveness. I say “potential” because we are not there yet, and there are serious systemic barriers to overcome.
RBC’s Robert Carlyle acknowledged as much during his informative presentation. There are very good reasons to begin the journey: In an information economy, human intellectual capital increasingly drives value in organizations. HR analytics has emerged at the right moment.
But if the big five haven’t figured it out, the rest of us might want to wait until we overcome the systemic barriers to HR analytics and organizational effectiveness.
The heart of the matter is that HR processes and projections are based on best practices and rules of thumb. The profession has amassed a hard-earned level of expertise without analytics, and is invested in what it has achieved. But rules of thumb don’t work everywhere and in a post-industrial, globalized world, sometimes they no longer work.
Analytics, the fodder for evidence-based decision-making, is challenging “best practices.” Inevitably, there is push-back. As Carlyle said: “Opinion without evidence should not stand up over time.” It’s no wonder he repeatedly stressed that change management is vitally important to the analytics journey. He recommended deploying all the tricks familiar to HR: executive buy-in, early wins, education, infrastructure investment, breaking down silos and promoting a systems perspective. And, well, how often have your disruptive-technology change-management initiatives succeeded?
Which brings us to the foundation of any successful change initiative: Clarity of accountability and authority, or what Carlyle referred to as management “processes” and “routines.” Carlyle referred to success with HR analytics being connected to “improved decision-making.” This is clarity around who is accountable for what, with what and who, in which circumstances, how often.
This will be the “heavy lifting” of HR analytics: Using role clarity to break down silos within HR and across functions to ensure data and people are connected. To ensure, at the least, data reporting standards (accuracy and consistency) are employed, that an enterprise-wide common language is used to describe the workforce, and data reporting “on an industrial scale” is the way we do business.
The right talent
Carlyle’s most cogent insight was that data is not an insight: “It’s just a fact.” There is a misconception that data will tell you everything, whereas the gold in HR analytics is in the context of the data: Understanding HR and understanding the needs of the business, combined with insight.
Where is the talent to do all that? The role looks like an HR business partner with an executive MBA who has a deft hand at pattern recognition and challenging sacred cows.
As Carlyle said, “If you know someone who could fill the role, I’ll hire them.”
HR analytics, like all analytics, is the future. But the journey will be rocky until we overcome resistance, structurally embed the processes and build the talent.
Michael Clark is director of business development at Forrest & Company. Forrest is an organizational transformation firm, with over 25 years experience in developing the organizational and leadership capacity in organizations.
Human resources analytics advance HR’s value-add proposition
By Trish Maguire
How many times have we heard that HR does not have a seat at the executive table? As I listened to Robert Carlyle, director of strategic workforce management at RBC, I felt if more HR leaders fully optimized modern technology tools, they would actually find themselves owning the table — never mind having a seat.
Carlyle described how RBC’s HR business partners are leveraging and integrating people analytics to transform and enhance the workforce planning process. Gone are the HR metrics of the late 70s, along with the simple analytics of the early 90s.
With HR analytics, HR no longer needs to count on a sales forecast or past data to manage workforce planning. Neither practice has the capacity to give HR the data it needs to predict future workforce needs in today’s unstable marketplace.
It’s no longer about using workforce planning as an exercise in filling jobs; it’s far more holistic than that. Offering advice in pragmatic business terms about what is going to happen tomorrow — based on predictive techniques and planning processes — is a new value-add scenario for many HR leaders.
Globalization is changing today’s workplace. Between the incessant introductions of new technology, the constant drive of competition, the destabilization of the labour market and the turbulent global economy, HR needs to predict, plan, design and invest in future workforce capacity.
Pre-recession, the tabloid headings were all about the talent shortage in light of the pending exit of baby boomers choosing retirement options. Since 2008, however, not so many baby boomers are choosing the traditional retirement route. And now generation Y is entering the workforce. With the advancement in technology and HR analytics, HR now has the capability to leverage and integrate both scenarios effectively.
When 70 per cent of an organization’s expenses are in people, a shift has to happen in how intellectual people capital is measured. The value of people’s skills within organizations is changing, as it must.
More and more routine jobs are being automated and greater attention is being paid to building top-quality customer relationships. People are increasingly expected to create new ideas and products, offer advice and work with progressively more complex systems.
Enter the requisite role of HR. Enhancing the future workforce planning process by analyzing the trends, drivers and causes in recruitment, retention, employee development and engagement is a fundamental value-add proposition.
The key advantage with the new HR analytics Carlyle highlights is the ability to proactively analyze, predict and reshape future skills, knowledge and abilities as the organization and marketplace changes. RBC’s goal is to improve workforce and people management decisions, to better achieve business objectives and optimize investment in people.
A challenge for HR services has invariably been around quantifying its value to the organization. Being able to align, integrate and predict the effects of HR services on any organization’s performance is essential for today’s workplace.
Using human capital analytics to generate leading indicators, models and measures allows HR services to move away from offering transactional services to becoming a quantifiable strategic force.
Unmistakably, HR has every opportunity to “own the table and not just have a seat.” Now’s the time to step up, invest in and leverage modern technology tools and prove your value-add proposition.
Trish Maguire is a commentator for SCNetwork on leadership in action and founding principal of Synergyx Solutions in Nobleton, Ont., focused on high-potential leadership development coaching. She has held senior leadership roles in human resources and organizational development in education, manufacturing and entrepreneurial firms. She can be reached at firstname.lastname@example.org.
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