Somewhere in the market, vendors are providing products that can track a company’s headcount, breaking the workforce down into groups or genders or by ethnicity. These applications are fine for what they can do: give the user data about differences such as those between the marketing and finance groups, including salary differentials.
But is this talent analytics? Heck, no. This is essentially a dressed-up list. But some vendors might claim such a product is, indeed, talent analytics.
Elsewhere in the market, vendors are providing human capital management, talent management, applicant tracking and performance management software. These applications are fine for what they can do: essentially, help run a human resource operation.
Are they providing talent analytics? Probably not — even if a vendor claims otherwise.
Instead what they usually are doing is providing users with a very light ability to pull data from within their app, said Dave Weisbeck, chief strategy officer with Visier.
“That is not people analytics,” he said. “You could call that embedded reporting for your applicant tracking software.”
Dressing Human Resource Software in Talent Analytics Clothing
This isn't to suggest the world of human resource software is rife with fraud. Rather, this tendency to exaggerate and over-hype cuts across almost all software categories. We've already looked at this trend in the robotic process automation space and machine learning, to name just two. And so it also is with human resources, said Weisbeck. “There are dressed up applications out there that are definitely not people analytics, but say that they are.”
Often these applications are simply doing college-level regression analytics and statistics, said Xavier Parkhouse-Parker, co-founder and CEO of PLATO Intelligence. “It can be hard to spot because often times they can produce some really cool results — but it’s still not talent analytics.”
Related Article: Talent Analytics: What It Is and Why It Matters
Spotting the Difference Between Fake and Real People Analytics
To tell the difference between the pretenders and the real thing, companies shopping for a talent analytics solution should look out for the following:
An over-emphasis on reporting
There is nothing wrong with reporting, said Weisbeck, it is a viable use case. But reporting is only a small piece of talent analytics.
The reality is, such a vendor's core competency is likely something else — for example, applicant tracking or payroll. “But they know they need to check a box on analytics.” What these companies are really doing, though, is building lists, he said. Analysis, by contrast, “has to give you root causes and in order to find root causes you have to be able to find patterns and make connections. And that means cutting across the data.” Which brings us to ….
The application can’t bring in outside data
“If you can’t connect the data or bring together multiple sources, then you can’t do something as basic as improving your quality of hiring,” Weisbeck said. “Because to improve the quality of hiring you have to look at where you source people, you have to look at how they’re performing once they’ve joined the organization and then see how they are progressing. All of that is in probably three or four systems and if you can’t bring it together then you are not doing analysis.”
If the vendor can’t explain to you how they are using the data to get results then something is wrong, Parkhouse-Parker said. “More to the point they can’t run a proper test or pilot with your data. Or if they do, the answers are just generalized to your situation — sort of like a horoscope.”
Speaking of analysis …
The application must be able to perform multi-dimensional analysis, Weisbeck said. “A list is one thing, but multi-dimensional analysis would allow you to see, to give an example, the employees you have hired in the last year, next to the performance ratings in their initial hire — and then limit that list to the people hired by proactively reaching out and sourcing them through LinkedIn.” That exercise, he said, gives the company an understanding of how LinkedIn is performing as a source of quality candidates.
The vendor can’t give examples of past client scenarios
A vendor doesn’t have to tell you the name of the client, but it should be able to tell you what results the client realized from using the application, Parkhouse-Parker said. “At the end of the day, if you can’t see or hear about other people’s results then I would question whether they exist.”