Predictive Analytics for Human Resources

The step–by–step guide for executing an effective analytics project We are standing amid the greatest accumulation of data ever in existence, and it is growing exponentially while you read this. The imperative is to turn data into information and then into intelligence .From the Preface Dr. Jac has been the real deal in Human Capital thought leadership for more than 35 years. He proves it once again by laying out a step–by–step roadmap to analytics in his fifth book on the subject, co–authored with John R. Mattox II. If half as many people buy it as have come to hear him speak about the subject at the HR Technology Conference over the years, you wont get to read this. Bill Kutik, technology editor for Human Resource Executive for 25 years; father of the 17–year–old HR Technology Conference Jac and John write from decades of experience, describing practical steps for human capital managers to get started with human capital analytics. They provide a wealth of very accessible tools, tips, and examples, distilling the best from their unique insights. Dr. John W. Boudreau, Professor of Management and Research Director, Center for Effective Organizations and Marshall School of Business, University of Southern California Predictive Analytics for Human Resources is a must–read for HR professionals seeking to build a robust analytics practice. Jac and John have provided the HR profession an indispensable guide on how to get started and how to move forward with predictive analytics. If you are serious about building capability in human capital analytics, you will follow the guidance found in Predictive Analytics for Human Resources . Patti Phillips, PhD, President and CEO, ROI Institute Fitz–enz and Mattox have applied analytics to predictive analytics. Their work isolates the analytics process and reintegrates it into useful tools for solving business problems. This excellent work is both a primary on the principles of analytics and a codebook on how to use them. Jac continues to evolve this field in creative ways. Dave Ulrich, Rensis Likert Professor of Business, University of Michigan; Partner, the RBL Group Jac and John have written the essential book on analytics for human resources. Its a practical guide on how to design, develop, and maintain an analytics program. If you want to know where to start and how to do it, this is the book for you. Stuart Evans, PhD, Distinguished Service Professor, Carnegie Mellon University–Silicon Valley Dr. Jac Fitz–enz is simply a gift to HR leaders who want to be effective in business today. Any HR practitioner living through the dramatic curve jump from too little to too much quantitative workforce data should read this book. It is a practical and insightful manual that will help the reader navigate the critical requirement of transforming data into knowledge that drives performance. Joni Thomas Doolin, CEO and Founder, People Report, a TDn2K Company

Foreword xiii Preface xv Chapter 1 Where’s the Value? 1 Some Basics 1 What Is Analytics? 2 Two Values 4 Analytic Capabilities 4 Analytic Value Chain 6 Analytic Model 8 Typical Application 14 Training Value Measurement Model 15 Inside the Data 16 Notes 19 Chapter 2 Getting Started 21 Go–to–Market Models 22 Assessment 23 Developmental Experiences 23 Financial Connections 24 Sample Case 26 Focusing on the Purpose 26 Present–Day Needs 28 How Human Capital Analytics Is Being Used 29 Turning Data into Information 30 Three Value Paths 30 Solving a Problem 31 Essential Step 31 Prime Question 32 Case in Point 32 Preparing for an Analytics Unit 33 Ten Steps for an Analytics Unit 35 Structure and Team Building 36 Developing an Analytics Culture 37 Notes 37 Chapter 3 What You Will Need 39 Dealing with the C Level 40 Breaking Through 41 Research 41 Recruiting a Sponsor or Champion 42 Making the Sale 43 Selling Example 44 Working with Consultants and Coaches 46 Designing and Delivering Reports 48 Making an Impact 50 Process Management 50 Preparation 52 Notes 54 Chapter 4 Data Issues 55 Efficiency Measures 56 Effectiveness Measures 61 Business Outcome Measures 67 Note 69 Chapter 5 Predictive Statistics Examples 71 Begin with the End in Mind 71 Go Back to the Beginning 74 Who Owns Data, and Will They Share It? 75 What Will You Do with the Data? 77 What Form Is the Data In? 79 Is the Data Quality Sufficient? 80 Note 82 Chapter 6 Predictive Analytics in Action 83 First Step: Determine the Key Performance Indicators 83 Second Step: Analyze and Report the Data 89 Relationships, Optimization, and Predictive Analytics 96 Predictive Analytics 97 Interpreting the Results 102 Predicting the Future 111 Structural Equation Modeling 113 Notes 114 Chapter 7 Predicting the Future of Human Capital Analytics 115 What Does the Future Look Like? 116 Bringing It All Together 126 Predictive Analytics for HR in Action 126 Notes 128 Epilogue 129 Appendix: Example Measures of Efficiency, Effectiveness, and Outcomes 133 About the Authors 135 Index 137

JAC FITZ–ENZ, P H D, is founder and Chief Executive Officer of Human Capital Source, Inc. He founded the Saratoga Institute in Santa Clara, California after holding human resource positions at several major technology and financial services companies. He is widely regarded as the father of human capital strategic analysis, having published the first HR metrics in 1978 and the first international HR benchmarks in 1985. JOHN R. MATTOX II, P H D, is Director of Research at KnowledgeAdvisors. He is a former Associate Director of Performance Management at KPMG, Manager of Learning Effectiveness at PricewaterhouseCoopers, and a Manager at Arthur Andersen.