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Human capital intelligence: Raising the bar

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Human capital

The time has come for HR departments, payroll and personnel managers to stop caring that technology allows them to track and reward their employees accurately, says John O’Neill, managing director of Bond HR.


The fact that employee records can be shared across an organisation, kept up-to-date through self-service access, and result in timely and accurate payslips is no longer remarkable and should be taken for granted.

Now HR, payroll and personnel should raise their expectations of IT and seek more value from their systems and the information held by those systems. They should expect to realise information that supports their work at a strategic as well as operational level. They should expect systems to provide information that helps to solve business critical challenges, drive forward their organisations and deliver clear benefits to the bottom line.

Last piece of the puzzle

The tools for realising this step up are already available. Systems can be linked together, driven from a single database and process clean data securely around the clock from anywhere in the world.

“What is required is something that compliments these business intelligence systems – a human capital intelligence system which links together the recruitment, development and rewarding of employees.”

In the finance driven parts of an organisation, business intelligence systems already bring together diverse data to help company leaders predict and shape the future of their organisation, enabling them to make informed high level decisions. However, these systems fail to consider the most important asset of the organisation – the people.

What is required is something that compliments these business intelligence systems – a human capital intelligence system which links together the recruitment, development and rewarding of employees in a way that supports the objectives of the organisation.

Take the example of a business that is set to undergo expansion due to perceived increased demand of products and services. That expansion requires new investment which will only be undertaken if it is backed up by relevant and clear financial data, drawn from diverse parts of the business.

But even if the overall predicted sales and turnover are encouraging, how do the business leaders know they have the people on hand to make it happen? Is there any extra capacity within the current workforce to deliver increased production? How would increased overtime impact of the wage bill – indeed are their current employees legally able to work for longer and would they be willing to do so?

Does the workforce have the skills necessary to deliver or is recruitment the only way to successfully realise the business potential identified? If the latter is the case, what skills are required and what is the most cost effective way of bringing those skills into the organisation?

Undeveloped potential

Without clear answers, backed by relevant HR evidence, organisations will continually be held back from their future objectives, stalled by the need for the company’s personnel to meet new demands. More alarmingly, there is the chance that the entire personnel function will be sidelined from strategic discussions, regarded as a function to be negotiated around rather than brought on board to contribute positively.

In today’s competitive and global markets, it is not enough to be able to provide accurate facts and figures about an organisation’s workforce; what is required is actionable information.

This means taking a dynamic approach to company information, gathering data that identifies critical aspects of the workforce and inspires HR professionals to take the initiative and deliver improvements for their workers and organisations.

It is possible to identify absenteeism trends and to place an accurate cost on that absenteeism. Therefore, if HR implements practical steps to reverse the trend they can have a measurable impact on company productivity, turnover and ultimately profit.

“In today’s competitive and global markets, it is not enough to be able to provide accurate facts and figures about an organisation’s workforce; what is required is actionable information.”

Creating a system that delivers human capital intelligence does not mean being prescriptive in technology architecture, functionality or even the systems implemented. It’s about being aware of the individual needs of each organisation and creating the right links, connections and processes which will liberate the information already collected and held by the organisation.

One size does not fit all and every system must start with the identification of the human capital information that’s important to the business and how that information can be generated and used. With this approach, human capital intelligence systems can be developed for any organisation, regardless of size, sector and location.

Damning with faint praise

Today’s HR and personnel systems are often praised for enabling data entry to occur at the most appropriate point, ensuring line managers are able to maintain accurate information. Too often they ignore the fact that line managers are not just the source of HR information, they are consumers as well.

In other words, they should no longer be regarded simply for ensuring competent data entry, they should be permitted access to relevant information in order to manage, develop and reward their employees more effectively.

The opportunity to bring tangible value to an organisation through human capital intelligence is with us today. The technology works and does not require a host of disruptive implementations.

The importance of taking the initiative in this area is clear – more organisations will realise the potential of the information already existing in their systems – and it is only a matter of time before this approach becomes common place. Organisations that pursue this objective now can steal the competitive edge.


For more information, please visit www.bondhr.com.

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One Response

  1. Don’t re-create the wheel
    I agree with much this author says, and am happy to have more and more people recognize the power of human capital intelligence.

    However, I disagree that each organziation should build it’s own. Organizations would be best served to look at existing tools in the market. While the connection to business strategy is critical this can be accomplished with the content available in current solutions, even those offered on-demand. The content of our tool Workforce Insight OnDemand, based on 5 years of experience with the early adopters in this field, reflects the operational, organizational, and strategic analytics germane to all uses. Which ones to use and emphasize is where strategy comes in. We have worked with clients of different sizes and and in variois industries. Our product content is independant of the client’s current technology platform and future changes; can incorporate critical business KPIs so links to business outcomes can be discerned; and, has content in all talent management and HR areas, and so can show the return on all human capital investments. Based on experience with clients who ‘designed their own’ they simply automated the same ineffective measures they were already using. A best practice, on-demand product has the fastest time-to-value and the lowest total-cost-of-ownership, and can be acquired for very reasonable monthly subscription rates.

    Joanne Bintliff-Ritchie
    Chief Strategist
    http://www.doublestarinc.com

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