Does your talent supplY chain measure up? Applying advanced data analysis to your human resource needs

Tom Tisdale

IT skills: 8.3 Reliability: 6.4 Affordability: 3.0

Finance skills: 5.2 Reliability: 7.6 Engineering skills: 7.3 Affordability: 8.0 Reliability: 5.0 Affordability: 6.7 Table of contents

3 Introduction 5 The mirror is your worst enemy 9 Asking the right questions 11 Speaking the language of big data 13 Conclusion

2 Introduction

Workforce planning by gut feel is a hallmark of many companies—but Tom Tisdale it’s also a relic of the past.

Few companies can succeed The solution for companies looking However, many companies develop without having the right people to overcome these constraints these insights within a narrow band. in the right place at the right is to revamp their workforce They use analytical tools to examine time, but most companies are planning and make more use of inward-facing factors looking at flying blind when it comes to data analytics capabilities. In fact, metrics independently, such as how establishing effective talent supply research conducted by the MIT quickly they can fill roles. Leading chains. This is because they’re Sloan Review, in companies are instead tapping constrained by four key actions: with the IBM Institute into higher-value analytics activities for Value, has found that that look at inter-relationships • Benchmarking against top-performing between performance metrics themselves instead of are more likely to have advanced and enable them to benchmark global best practices workforce analytics practices than their talent suppliers against peers • Fixating on the who, what low-performing companies. across their entire industry. and when of workforce planning and largely Making the most of data ignoring the why and how In an era of big data, companies • Acting on gut feel when have access to more information making decisions about talent, than ever about their staff and rather than concrete data talent suppliers. By analyzing • Narrowly focusing on managing this information in more depth, talent suppliers in order to fill companies can develop actionable roles, rather than managing insights to improve their talent the entire talent supply chain. management practices.

1 IBM Institute for , Analytics: The new path to value, 2010, www-935.ibm.com/services/uk/gbs/pdf/Analytics_The_new_path_to_value.pdf, p. 4.

3 That’s the focus of this paper: How you can make the most of the intelligence available to your business by focusing on what we call Talent Supply Chain Analytics—using big data and the latest analysis tools to improve the effectiveness of your whole talent supply chain.

4 the mirror is your worst enemy

Successful companies are When it comes to workforce Given the complexity of talent taking a much wider view planning, many companies are supply chains, a company cannot of talent and their needs. transfixed by the mirror. That is, consider workforce planning in they are predominantly focused on isolation. Rather, it should rigorously themselves and how they will meet evaluate its activities across the their immediate need for talent. entire talent supply chain—and However, this relatively self-centered against global best practices. The key to this approach is to use big approach could be instilling data and the latest data analysis ineffective talent management techniques to gain new insights. practices and lead to myopic decision-making. Talent Supply Chain Analytics enables a smarter, more data- The workforce planning landscape driven approach to creating and extends well beyond a company’s managing your talent supply chain, current need to fill a role. It includes and delivers actionable insights for the talent you need and the talent enhancing its effectiveness. you have; it includes the talent you will likely need in the future and the A break with tradition talent you had in the past. Typically, companies judge their It’s also vital to consider how your talent management strategies corporate functions—operations, and the effectiveness of their and — talent supply chains by evaluating interact to drive strategic alignment how efficient they are in bringing with the talent supply chain. people into the .

5 the mirror is your worst enemy

This could involve understanding Figure 1: Understanding the full scale of your talent supply chain how long it takes to recruit staff and how much this process costs. corporate Talent But once talent is working at the strategic plan Temporary company, the analysis stops. staff

Independent Talent Supply Chain Analytics contractors/ freelancers considers the continuous flow of talent through a business, including operations how long they stay and how Workforce analytics effectively suppliers perform in service providers delivering talent. It also considers Strategic (SOW) workforce how other factors affect the planning operation of the supply chain as a human resources whole; if you pull one lever forward Alumni, and push another back, how does retirees and interns that change the overall supply of talent and key metrics? full time employees procurement In an overall sense, Talent Supply Chain Analytics helps companies look beyond themselves—and the present—to develop actionable insights that will enhance talent supply strategies. In particular, Talent Supply Chain Analytics uses internal

6 the mirror is your worst enemy

and external data, across labor This progression requires a shift of current suppliers. This narrow types, input models and geographic from transactional management frame of analysis limits the scope locations, to underpin improvement towards process management, for continuous improvement of the initiatives and set companies on a understanding and planning. supply chain and, consequently, the path of continuous improvement. agility of the business. If that can be achieved, the business So, while most companies are will move from being tactical to Talent Supply Chain Analytics can focused on basic reporting metrics strategic—not just managing the be used to benchmark a company’s that are largely internally driven, supply chain but relating it to the supply chain management practices leading organizations are leveraging company’s overall . against their entire industry and Talent Supply Chain Analytics to drive It will also demonstrate how the key verticals for a range of factors, higher-value activities and decision- company’s talent strategy is helping including supplier performance. making. These activities include to deliver on those goals. benchmarking and developing Companies should know how predictive insights, which are the Testing yourself effective their current suppliers are foundation of a truly strategic against the best in securing necessary talent. In this approach to workforce planning. evaluation, cycle times are extremely One way to draw your gaze important. want industry- As can be seen in the chart on away from the mirror is to leading suppliers that can deliver page 8, companies moving up prioritize benchmarking. the right talent in a timely fashion. the workforce planning value chain progress from visibility and In our experience, relatively few To benchmark cycle times, a clarity (efficiency) to optimization companies undertake consistent company would first examine and benchmarking (effectiveness) talent supply chain benchmarking, its current suppliers’ cycle through to or, if they do, they evaluate their times and look at how they’ve that enable strategic alignment. performance within their known set changed over time. The

7 the mirror is your worst enemy

business would then compare Figure 2: Where you are... and where you want to be this performance to the entire industry and across key verticals, Strategic workforce planning to consider questions such as: • How does our network of suppliers compare to others in the market?

• When we look beyond ourselves, predictive insights are our suppliers outperforming or underperforming? benchmarking

The next step would be to test Moving up the various levers. For example, if workforce planning we remove our least effective value chain suppliers and replace them with more effective providers, how will optimization that affect cycle times? This process helps companies put in place the right mix of suppliers based on benchmarked data, rather than incumbency or gut feel. visibility and clarity

For many companies, this is a radically different approach to supplier management because current supply base performance is only the starting point for more in- depth analysis and benchmarking. 8 Asking the right questions

The key is for companies When it comes to talent supply insights. These insights can help to stay one step ahead chains, many companies become the organization better predict the of themselves—and content with visibility and potential impact of making changes. the competition. optimization within their existing The dashboard on page 10 shows supply chain. Instead, they how a company can understand the should move from seeing what is way in which its number of suppliers happening to understanding why it affects cycle time. It also illustrates is happening. To achieve this level of trends, the expected results of insight, requires asking the how and changes and the benchmark why questions. Where are the talent itself. Key components to the bottlenecks occurring, and why are analysis include: they occurring? This is where Talent • Leveraging big data to Supply Chain Analytics can help. benchmark across multiple markets and programs By using analytical tools and • Analyzing the inter-relationships visualizing the results of analysis, a between multiple KPIs, instead company can identify and respond of measuring only one indicator. to emerging trends before they • Using data visualization become stumbling blocks. By instead of columns of cross referencing key performance data to tell the story. indicators (KPIs) and understanding their interrelationships, an What’s my age again? organization can see how things are working, diagnose root cause Some companies struggle with issues and determine topical aging orders—staffing requests

9 Asking the right questions

Figure 3: Sample analysis—answering how supplier numbers affect cycle times

that remain unfulfilled by their Figure 4: Visualizing canceLled and aging requisitions suppliers—as well as orders that are cancelled internally. Aging orders mean that a business does not get the right talent at the right time, and continued cancelled orders reflect that the supply chain is being wasted and will eventually be depleted (suppliers will be fed up working on orders that get cancelled and take their talent elsewhere).

Companies can currently see how long orders are open and how many are cancelled at varied aging intervals. However, by using Talent Supply Chain Analytics to layer to the depth of analysis that orders that are still unfulfilled understand the inter-relationship and helps businesses to be more after 10 days are likely to be between the two (when aging efficient in delivering supply and in cancelled, and why they’re likely to orders are cancelled and why), they managing demand. Even better, it be cancelled, they can use those can undertake deeper analysis and can harmoniously balance the inter- insights to refine their sourcing calculate at what point an aging relationship of supply and demand. strategies. At the same time, order is likely to be cancelled. Armed with this information, suppliers can act to better regulate This information can also be decision-makers can get ahead of the flow of talent they provide evaluated by role. This adds another the curve. For instance, if they know to enhance utilization for both.

10 Speaking the language of big data

The war for talent The era of big data is giving They are shunning decisions based has moved to a more companies fresh opportunities to on emotion or gut feel, and have technologically advanced glean insights and enhance their instead developed a culture of battleground. talent supply chains. However, while evidence-based decision making many businesses have invested to glean actionable insights from substantially in big data tools, not vast data sets.3 all of them are using these tools to To create such a culture, improve workforce management. organizations should prioritize We believe that all companies should four practices: recognize the tremendous potential • Establishing one undisputed of big data and workforce analytics source of performance data when it comes to talent. Research • Giving decision-makers at all published by The Conference levels near–real time feedback Board suggests HR leaders should • Articulating business rules and think like economists and maintain regularly updating them in a 360-degree view of KPIs.2 These response to facts factors might include: regulatory • Providing high-quality coaching changes, the outlook for the to employees who regularly economy, and labor supply trends. make critical decisions.4

Other research has found that But it is important to note that, leaders in talent supply chain despite its benefits, organizations management are fluent (or may need to secure buy-in from approaching fluency) in the to implement language of big data and analytics. big data analytics. This could include

11 speaking the language of big data

executive sponsors who are willing Research published by to put in the right framework for such The Conference Board suggests analysis—a framework that includes consistent data collection; a robust HR leaders should think like and relevant set of business-related economists and maintain a 2 questions that have been developed 360-degree view of KPIs. by managers; and the presence of trained analysts who understand the business, data sets and analytics tools.5

The important point is that developing actionable insights from big data is not a technology question. Rather it is about the way companies open themselves up to critical analysis, learn from the insights of analytics, and take calculated risks to improve their talent supply chain.

Data is a differentiator and its consistent application in strategic 2 Phillips, P. & Hubble, C., “ in Review: Focus on Human Capital Analytics,” The Conference workforce planning will give Board, 4(1), 2014, www.conference-board.org/publications/publicationdetail.cfm?publicationid=2684. 3 Ross, J.W., Beath, C.M., & Quaddgras, A., “You may not need big data after all,” Harvard Business Review, December 2013, hbr.org/2013/12/you-may-not-need-big-data-after-all/ar/1. companies that embrace it a 4 Ibid. 5 Modern Survey, “Why your HR department needs big data,” 2013, www.modernsurvey.com/wp-content/ significant competitive advantage. uploads/2013/08/Why-Your-HR-Department-Needs-Big-Data.pdf.

12 conclusion

Talent Supply Chain Analytics is about more than filling one role or addressing a single trend. It is about implementing a robust, fact-based approach to workforce management that ensures companies can address their talent needs efficiently and effectively.

In practice, Talent Supply Chain And it is about making decisions Analytics is about putting the mirror based on the power of big data aside and relentlessly comparing rather than gut feel. In today’s your supply chains to those of the global market for talent, the most best-performing companies in successful companies will be those relevant industries and verticals. that explore every angle possible to It is about asking (and answering) secure the right staff. They will be the tough questions: using Talent Supply Chain Analytics • Where are we underperforming? to make the right decisions at speed • Why are we underperforming? to drive business success. • How can we improve? • Are our supplier networks letting us down?

13 For more thought go to talentproject.com

About the author Tom Tisdale is , Talent Supply Chain Analytics, KellyOCG Centers of Excellence. In this role, Tom leads a team in analyzing and aggregating internal and external data to assist clients in managing their talent supply chain. Prior to Kelly, Tom was part of the founding team and the SVP of Strategic Initiatives with one of the market leading VMS and ATS providers. Tom has worked for a variety data warehouse firms in executive level positions and has been ranked as one of the most influential top 100 individuals (SIA) in staffing. He has sat on numerous advisory boards including SIA and Staffing.Org (both in initiatives to establish industry standards for KPIs). Tom has a BS from VA Tech in Industrial Engineering and Operations Research.

About KellyOCG KellyOCG® is the Outsourcing and Consulting Group of workforce solutions provider, Kelly Services, Inc. KellyOCG is a global leader in innovative talent management solutions in the areas of Process Outsourcing (RPO), Outsourcing (BPO), Contingent Workforce Outsourcing (CWO); including Statement of Work (SOW) Management, Independent Contractor Solutions; Human Resources Consulting, Career Transition and Executive Coaching & Development, and Executive Search.

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