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Hosts Stacey Harris and John Sumser discuss important news and topics in recruiting and HR technology. Listen live every Thursday at 7AM Pacific – 10AM Eastern, or catch up on full episodes with transcriptions here.

HR Tech Weekly

Episode: 60
Air Date: March 3, 2016

 

This Week

This week John and Stacey discuss:

  • Japan’s Largest HR Company Invests in People Analytics Firm hiQ Labs Link
  • Apple shareholders reject diversity plan to recruit minorities as company leaders Link
  • 1 in 5 HR Managers Admit That Women at Their Companies Get Paid Less Than Men Link
  • Wearable technology: Helping solve the productivity puzzle Link
  • Wearable Tech Familiarity and Consideration on the Rise Link
  • Redefining Talent: The CHRO Point of View (IBM) Link
  • Topics: #wearables, #HRAnalytics, CHRO

About HR Tech Weekly

Hosts Stacey Harris and John Sumser discuss important news and topics in recruiting and HR technology. Listen live every Thursday at 7AM Pacific – 10AM Eastern, or catch up on full episodes with transcriptions here.

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Begin Transcript

John Sumser: Good morning, and welcome to HR Tech Weekly, One Step Closer with Stacey Harris and John Sumser. Hey, Stacey, show 60.

 

Stacey Harris: Yep, we’re here at 60 shows, and I think we’ve done a pretty good job keeping up with every week new topics and articles, John, so I’m excited to continue on to the next 60 here.

 

John Sumser: All right, so here’s the big question. What’s in Stacey’s mailbag?

 

Stacey Harris: It’s not been a busy week, I wouldn’t say, for HR Tech at all, but there’s been some interesting I think things buzzing in the air, I guess is a good way to put it. I got a little article about hiQ Labs getting some funding from a Tokyo based company, and primarily I pulled them because I know you just recently spoke at a hiQ sponsored event. We’ll talk a little bit about that, and the world of HR analytics, and what’s happening right now. We also have some news being made right now around the area of diversity and women’s equity pay, those type of issues. There was interesting news about Apple shareholders rejecting a diversity plan to recruit minorities as company leaders.

 

Also about a study that came out around one in five HR managers admitting that the women at their companies get paid less than men, and they know that. There’s some new stuff going on at Mercer I think, and a couple of other organizations, like PeopleFluent, where they’re focusing on diversity, so there’s some interesting topics there. There was a fun article on wearable technology this week coming out of the UK and how UK workers are embracing wearables as a positive thing. I thought that was an interesting article, worth spending some time in. Then if we have a little bit of time today, there’s definitely some good articles from the work that’s being done with the two big what we’d consider as competing HR reports that come out [in L.A. 00:02:09] these days.

 

One is Deloitte’s Global Human Capital Trends Report, put out by our good friend, Josh Bersin, as well as IBM usually puts out annually or every other year their Chief HR Officer Report. That went out in the last week or so. Both of those have I think interesting differing opinions that we can maybe counterpoint today, so lots of stuff to talk about. Do you want to start maybe talking about your analyst, or speaking event, at the hiQ Labs event, maybe talk a little bit about what that was and then who hiQ is, John?

 

John Sumser: Sure. On Tuesday I did a keynote for hiQ Labs. HiQ Labs is, give it Haiku, HiQ, it’s a play on words. HiQ Labs is an analytics company. Their first product as an analytics company is an individual by individual score of the amount of pressure the labor market is inserting to pull that person away from your organization. They’re doing continued experiments with what you could do with external data to predict the behavior of people inside the organization. It’s a very interesting thing. I’m not sure that analytics is right, but I’m having a long, hard look at what the elements of analytics actually are. That day was, they do this great thing at hiQ, and that is that they’re building a community. They’re building a real vibrant community by having, I think they might be at five or six now, events a year pulling together people who do analytics for companies into small conferences.

 

The conferences, it opens with a couple of stories from customers, some introduction to the roadmap. It looks a lot like a user conference, but it’s richer in the customer content than the user conference. You’ve got this group of 400 people, say, talking about HR analytics and what it means, and it was phenomenal to see because this is a place where you could actually have somebody give a talk about what it’s like to clean data. Nobody wants to talk about what it’s like to clean data. For the geeks, for the people who are analytics geeks, this is like being able to discover that you’re not alone in the world. It’s a really big deal. There were a lot of very happy, very excited people at this conference, because it was a gathering of a tribe that’s highly dispersed.

 

Stacey Harris: It’s definitely our kind of people. There’s no doubt about that. Me and you were laughing right before the call. We were talking about the value of data cleaning. I know the research that I do, I have a coworker, Erin Spencer, who does an immense amount of data cleaning, and we do much of that in partnership. She does a lot of the heavy lifting, and I think there is so much energy that goes into data cleaning, and it adds so much value to the process, but it’s also the area that most HR analytics organizations wish they could speed up and wish that they could then somehow automate. It’s interesting to just hear that that was a topic of a big HR analytics function this week.

 

Do you find, John, that … We’re seeing more and more investment in these HR analytics softwares and companies. This investment by the Tokyo based organization, Temp Holdings, out of Japan, is just one of many that we’ve seen in the analytics space happening over the last couple of months and years. Do you think that organizations that are investing in these HR analytics solutions are investing in the technology? Are they investing in the processes? Are they just investing in people and trying … We don’t really know who’s going to win this game, I think, and whether it’s going to be things like data cleaning or it’s going to be the technology that’s going to take the most effort. What do you think?

 

John Sumser: I have a question for you actually here, and this will show you a shortcoming in my understanding. I have been seeing recently employee profiles being demoed that include flight risk quantification. Have you seen that?

 

Stacey Harris: Yes, definitely, yeah …

 

John Sumser: Is that new?

 

Stacey Harris: … For managers. I don’t know whether it’s new. You definitely have … If organizations have built some sort of a succession management model and have any kind of … Generally, the data comes from internal, so you’ll see a flight risk that’s based off of an internal set of data points, and organizations will have them in employee profiles. I think it is fairly new to see data and flight risk assigned based off of external data points. I think that might be new in the last year or so.

 

John Sumser: I guess I just wasn’t paying … Or I was sleeping through my job at the point where I was looking at that flight risk data and profiles, but it seems to me that it’s getting highlighted now. The idea that you can see data where people are characterized as flight risks strikes me as quite surprising, surprising because the consequence of being labeled in that way is significant, and it’s not all positive. It’s not a system that …

 

Stacey Harris: I think …

 

John Sumser: Go ahead.

 

Stacey Harris: I think the answer on this is the same answer with all data analytics, and that’s why I was asking the question about why are people investing in this space. What are they trying to get out of it? I think everybody realizes … The last analytics conference I went to, which was out in San Francisco, the other additional one that you spoke at, what I basically saw is that everybody has this line that they’re trying not to cross, which is almost an HR creepy line. We laugh about it, but it’s true, which is at what point are you assigning information, putting too much data to what a person, what they’re going to supposedly do or what they could possibly do?

 

At what point does that cross the line of affecting or having an impact on what that person actually will do? By telling someone that they’re a high potential, does that change how they react to the organization or what they will do? Then if you don’t do anything with that high potential rating in the next few years, does that mean that they may feel it’s time to leave? Where if you wouldn’t have said anything about being a high potential, would that have meant they’ve never really thought about it? We have that kind of question I think all the time in HR, which is, is the work that we’re doing actually having an impact, and does it have both adverse and good impacts, depending on what you’re looking at?

 

John Sumser: I think the problem is the accumulation of probabilistic information by people who don’t understand how to use probabilistic information. I’ll give you my stupid result example of me. I know pretty well what the odds are at any game in Las Vegas, but I’m not smart enough to play that very well or I haven’t taken the time to learn how to play that very well. In spite of the fact that I know the odds, I sit down at the blackjack table and lose my money, and I don’t want to get better at blackjack. That’s not on my list of things to grow up to be. Simply said, probabilistic information where you need to make a bet on the outcome is hard for people to process.

 

Not everybody knows how to do it. Most people don’t know how to do it. The number of successful people who understand the odds, who go to Las Vegas and play the odds, is quite low. I imagine the same thing is true about probabilistic information about human beings, which is even sketchier than the odds in cards. That’s where I end up with this problem, is people don’t know what to do with information like that even if they can have it.

 

Stacey Harris: I think that’s, to be honest, the challenge for almost all of HR analytics conversations right now, is that the companies themselves were built on the idea in most companies these days that you are trying to make the best decision with the information that you have and that the goal is always to be moving an organization forward in whatever performance metric you have decided important in the organization. People are not boxes though, and they’re not financial markets, and they’re not even large sets of marketing data points about how people might make decisions when it comes to buying things.

 

People are making personal decisions in an individual basis at a much more I think different level than what we see broad business based decisions being made at. HR, unlike some of the broad business based decisions, requires I think more humanity to the data than maybe some of the other analysis that we do at the enterprise level, and that’s the hard part. How do you put humanity into data analysis without basically going against all the models that we have in analytics in general at this point?

 

John Sumser: I think that’s interesting. It’s because all the rest of analytics refers to things in money. There are not really a lot of ethical questions associated with dealing with things in money. When you deal with people, there’s a big question there. I think the other thing that makes me anxious is there’s a bit of folk wisdom, and maybe you have an opinion on whether or not it’s true, that suggests that the likelihood that an executive, a manager or an executive, is a sociopath is much higher than the likelihood that somebody in your general universe is a sociopath, that the very things that make sociopaths occasionally dangerous are the things that are selected for in management, at least western companies. Have you heard that?

 

Stacey Harris: I have heard that, and I think another way of looking at it oftentimes is that if as companies get larger and larger, managers and executives stop seeing people and they start seeing numbers, a similar concept of this idea that you can ignore the other side of things. Whether it’s because managers have been selected for that or because as they go up the ranks things become less right or wrong and there’s a lot more gray areas or if it’s because the data masks what impact that organizations are having on people, I think all of those lead to the same outcome.

 

John Sumser: It unnerved me a little bit to see data about people put in the hands of that kind of mindset.

 

Stacey Harris: Let’s flip this a little bit. Two of the articles that I also pulled this week is the one about Apple shareholders rejecting the diversity plan to recruit minorities as company leaders, and the one about one in five HR managers admitting that the women at their companies get paid less than men. Tackle the one about Career Builder did a study on asking organizations, “Do you know that women at your company get paid less than men?” It was 78% of the men said, yes, they probably feel that way. Then there was the other percentage of the women and everything, but what I thought was the most interesting about this is I had just had this conversation with a group over at PeopleFluent, who have a technology that deals with diversity measurements and assessing compensation and how it’s played out in diversity levels.

 

I just said, “Are organizations really going to want to take advantage of something like that, because do they really want to know what’s happening?” To your point, when you start looking at data and start opening up what’s happening, and you start analyzing stuff, there’s decisions that have to be made once you have data in front of you because before that, you can basically plead ignorance. Once you have the data in front of you, you have to make some sort of a decision. Apple shareholders decided that they did not want to go forward with the plan that was put forward, not so much by anybody within the organization per se, but it was put forward by a civil rights group that wanted to basically say that Apple had to recruit minorities within their company leadership at a certain percentage and a certain pace.

 

The Apple shareholders basically said, “We can’t accommodate this and still run the company effectively” is basically what they were saying. They voted it down. They know for a fact that there is diversity issues across the whole technology space. What do you think about that, John? Do you think that plays into what you were just talking about? Is this is an issue of, we know the data. Now do we have to do something about it?

 

John Sumser: Something that I often tell people is that you should have a consultant doing your analytics projects because the analytics project will tell you things that you don’t want to hear. You’re going to want to fire the person who told you the thing that you don’t want to hear, and it’s easier if they’re a consultant. I think there’s real heat associated with the analytics job, and the kinds of people who are currently doing these analytics jobs are not people who thrive under conditions of heat. They’re a more rarefied and introverted class of people. You look at this thing at Apple, and I don’t know how to make sense out of it. What do you think?

 

Stacey Harris: I think the Apple thing was a group trying to put forth something on a company in a public format, in a way that they could, something that they felt was a way to maybe bring to light the diversity issues that are happening in the technology space. This was a great place where they knew it probably wasn’t going to get passed but they could bring to light what was happening and get some press about it. I think that the reason that it’s being brought to light is because anybody who’s looked at the data knows across the technology space that there is an issue with at the very least racial and gender diversity if not thought diversity when it comes to the HR tech, or the technology space as a whole, not just HR, but I think we still have the issue in the HR tech space as well.

 

My thought is that what we’re seeing is that data can be used in ways to create the conversation, and the organizations that are open to the idea that data is a conversation starter and not something that has to have an immediate decision done with it, I think it leaves more possibilities for organizations. If they’re an organization that is used to always making decisions as soon as the data is in front of them, I think that creates a bit of a scarier picture for HR analytics as a whole.

 

John Sumser: It’s territory that we’re going to have to navigate because what’s happening is we’re being buried with data, so we need tools to help us to make sense of the data. I don’t know anybody who isn’t overwhelmed by the amount of information they are trying to consume on a routine basis. It’s just the beginning of that. It’s just the beginning. It’s going to be unbelievable, when you have an Internet where everything is connected to it, and you know everything about everything, and you can figure out additional functionality. My favorite example of additional functionality is the microphone on a cell phone is also a speaker, because a speaker and a microphone are the same thing. It’s like a line where the water can go one way, and then it can go the other way. The very same things you have to do to get the sound into the system are the things you have to do to get the sound out of the system.

 

Any microphone can be used as a speaker and vice-versa. There are hacks out there that take advantage of that so that you can have a flow of data about what’s actually going on in somebody’s physical existence by simply tweaking their microphone on their cell phone. Tweaking the microphone on a cell phone is a trivial bit of code. It’s not some rocket science thing. It’s trivial to do this. There are conspiracy theorists who think that all of the big [inaudible 00:21:01] players are already doing it and that you can see things that come from your conversations show up in the stream of ads on your Facebook [cover 00:21:14], for instance. This kind of stuff is going to happen. It’s so crazy what’s going on, and there’s so much data being moved around that we need tools to understand. That’s what the promise of analytics is.

 

Stacey Harris: Do you think then, jumping to the article about Deloitte’s Human Capital Trends Report, one of the things that came out of this report I think that I wouldn’t say shocked everyone but basically I think raised some eyebrows, was that organizational design, which is as an issue in the HR space, has always been, “Yeah, organizational design groups are sort of off to the side, part of learning, maybe part of HR.” They’ve never been seen as a huge focus for HR unless an organization is going through mergers and acquisitions or big changes or downsizing or things like that. Organizational design was listed as the top issue of importance when Deloitte asked their 7000 individuals that they asked.

 

They asked business HR [persons 00:22:29] to assess the importance of specific talent challenges facing their organization. Organizational design popped to the top, above leadership, culture, engagement, all kinds of other things. I don’t know what was all on the list, but 92% of people said that it was very important. That’s the center of what is Deloitte’s 2016 Global Human Capital Trends Report. Do you think that it’s the center of the new focus for people because the existing organizations we have simply can’t take advantage of the data and simply can’t take advantage of how to make the decisions with this type of information we’re giving them?

 

John Sumser: It’s an incredibly complicated question to answer, and we should have a whole show about it, but if you work in Deloitte, this is what the world looks like. Deloitte, like many companies of it’s most, all companies of it’s size and scope, in other words B2B, business consulting, writ large, with some sort of other thing on the front end, but they don’t have companies in the way that the rest of the people have companies. Their people are in meetings while they’re on airplanes because they don’t actually have a desk. Their desk is at home. They’re not at home all that much.

 

They’re in a consulting environment somewhere, generally speaking, so this is exactly what the world looks like because it’s impossible to tell what the organization is when it is that amorphous and not constrained to a building. Organizational design really, really matters in that part of the world. My guess is that in the universe occupied by Deloitte, all of the people that they consult with and all of the people that they might consult with have similar problems. I can see how it gets to the top of the list very quickly, because it’s hard to get that stuff right. It’s really hard to get that stuff right. What do you think?

 

Stacey Harris: I agree that some of this might be the audience that Deloitte is working with on a regular basis, but I think that audience has for the last several years thought that things like leadership and engagement were big topics. I think the organizational design has become a bigger issue, although it’s always been an issue with those groups, I think it’s become a bigger issue. My sense would be, in reading through some of the stuff that Josh wrote on this, I think generally they’re of the same perspective, is that organizations are struggling to define what a new organization is in this world where there is not always a right or wrong answer.

 

Generally, when you … Business over the last hundred years or so, there has been some pretty tried and true ways about how you progress and build an organization and grow an organization. The models have stood true on management, and finances, and even to some extent how fast and quickly technology would change. All that has stood true. We know the type of makeup of your organization over time. That stood true for many, many years, but I think what’s happening, at least today, is that a lot of those old models are breaking down. A lot of the things that we assumed would keep working are not working.

 

I think in this world where data is freely available but yet so terribly disorganized, we need some new organizational models to support this concept, to support the idea of making decisions, running a business on data and not just off of intuition or skill sets or backgrounds or experience. Now IBM’s Chief HR Officer Report had somewhat of a little different perspective but still dealing I think with this data conversation. Their big imperative that came out of their report from their big survey … I think they do their research a little bit differently. They don’t do a survey per se. They do a series of interviews with over 600 different chief HR officers.

 

They’re really looking at the most senior levels in those organizations. They basically came out saying that, “Look, talent, everybody has to look at talent through a marketing lens.” The executives are starting to realize this, and when you look at things through a marketing lens, that means you’re looking at things through a data driven decision making model. You have to exploit technology, which means you have to use it from an analytical perspective, but you also have to use it to get work done, and that you have to become more flexible, and analytical, and social as an organization.

 

Again, the concept of designing and rethinking your organizational model fits there as well. I think it’s a reality. I don’t know what it looks like in the future, but I think it’s a real issue organizations have to tackle, which is today’s organizations are probably not what tomorrow’s will look like.

 

John Sumser: Another way of saying that is our old model of corporation no longer fits what’s going on in the world.

 

Stacey Harris: At least in the U.S. right now, yeah.

 

John Sumser: Yeah, and probably because … It would be interesting to understand if the U.S. model depends on other people having the old model. That would be a very interesting question, a really interesting question. You could then describe that as a kind of a colonial process. I think the U.S. has been criticized for that before, but I never really put it together in this way, that it’s organizational design that drives that entire thing. What a great conversation. It’s so cool that Deloitte has managed to end up in the position where this is the central conversation in the industry. That’s an extraordinary accomplishment.

 

Stacey Harris: I think we’ll be talking about this a lot more over the next year, whether it’s organizational design, how HR analytics fits into this, what is the role of organizations like IBM, Deloitte and building the conversation or pushing the conversation, or is this a conversation that is actually starting in places like HR analytics and HR technology organizations as well, who are trying to help organizations do something with all this data that’s in front of them. I think it’ll be interesting to see how it plays out over the next several months and year. [crosstalk 00:29:24] I think will be an interesting year.

 

John Sumser: I’m looking at the list of the trends again, and I think there’s a very interesting story to be told here, I think a very, very interesting story to be told here about how do you make sense out of the contemporary business environment. Very interesting. Cool. We’ve blown through our allocated time once again, and it’s been a great conversation.

 

Stacey Harris: Definitely. Never enough time to cover it all, John. I look forward to talking to everybody next week. We might be joining you next week at a different time. I think we’re going to do 3:00 Eastern next week instead of our regular time frame because of some challenges both you and I have from a traveling perspective.

 

John Sumser: Oh, that’s right, the whole airplane thing. Yep, so 3:00 next week. Good. Have a great day, everybody. You’ve been listening to HR Tech Weekly, One Step Ahead with Stacey Harris and John Sumser. Have a great … Where in the world did it go? Have a great time. Bye-bye.

 

Stacey Harris: Thanks, everyone. Bye.

 

End Transcript

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