Data overload; analytics turn a mishmash of facts into a workforce blueprint - Special Report - International Finance Corp

HR Magazine, Oct, 2003 by Drew Robb

For the past decade, HR professionals have dutifully entered employee data into HR management systems (HRMS). Every hire. Every transfer. Every departure. Within those databases lies a wealth of data that HR can use to guide workforce planning. But how can value be extracted from all of that raw information?

That was the challenge facing International Finance Corp. (IFC), part of the World Bank Group. Although IFC had some homegrown tools to pull data from its PeopleSoft HRMS system and import it into a spreadsheet, it didn't have what it needed to extract useful intelligence. Even worse, when different people would run seemingly simple queries, they ended up with conflicting results.

"We lacked an integrated view of our workforce and a historical perspective for doing analysis," says Joe Fucello, IFC's human resources program officer. "We needed quick answers to inquiries about our workforce, but we weren't able to provide those answers."

But all that changed once Fucello implemented a workforce analytics software package.

"We get a lot of queries such as, 'What is the average age of people who have left in the last five years?'" he explains. "It used to take overnight to run the numbers; now I can have the answer in five minutes."

Retention Challenge

IFC works in developing countries to provide financing for private-sector projects, assists companies with obtaining financing in international financial markets and advises businesses and governments. Last year, IFC approved $3.1 billion in financing for 204 projects in 64 countries.

Two-thirds of IFC's 2,000 employees work out of its Washington, D.C., headquarters, while the rest operate out of 80 branch offices. While IFC, like many companies, is concerned about workforce diversity, Fucello and his 40 HR colleagues must also ensure that the organization's workers reflect more than just the demographics of a single nation.

"IFC has 175 member countries who serve as shareholders and collectively approve the investments IFC makes in emerging markets," he says. "We have a very diverse workforce of 125 nationalities who are representative of the clients we serve in the developing world."

Hiring the right mix of staff is one thing; retaining them is quite another. IFC was losing a huge number of its loan officers before they had been on the job for five years, the point at which they become most productive. Fucello knew that to remedy the situation he needed a better way to analyze who left and why.

This is where workforce analytics comes into play. Analytic tools take all the raw data, combine it, compare it and present it in a format that managers can use for planning. Besides presenting historical trends graphically, such products also allow users to run "what-if" scenarios.

"The most useful tools are ones that can show relationships between changes you can make in the workforce and how it affects the business," says Jane Paradiso, national practice leader for workforce planning at Watson Wyatt Worldwide, a consulting firm based in Washington, D.C. This data must be presented at a high level. "If you get lost in the analysis of small details, that can be a problem."

Companies have several options in setting up such a system. (See "Analytic Options" on page 72.) At IFC, both HR and information technology (IT) staffs conducted evaluations, but HR had the final say. "The IT department helped us with the technical requirements," says Fucello. "But it was HR's decision in the end."

Nuts and Bolts

IFC considered several different products. One, from Cognos Inc., based in Ottawa, was a generic tool that would have required too much development to meet the organization's needs. Analytic tools from PeopleSoft Inc. in Pleasanton, Calif., and SAP AG of Walldorf, Germany, lacked the full features and functionality that IFC demanded. IFC went with Human Capital Management (HCM) software from SAS Institute Inc. in Cary, N.C.

"We felt it better to go with a pre-built HR solution rather than a generic OLAP [online analytic processing] package that would require a lot of customization," Fucello says. "This cut our implementation time and gave us a big head start."

Cost was also a factor in making the decision, Fucello says, but the declines to say what IFC paid for the software. However, Betty Silver, SAS's solutions strategist for HR, says the product is priced at about $5 per employee for the first year's license. Implementation typically runs about three times the software fee, with total costs starting around $100,000, she says.

Before beginning full-scale deployment, IFC conducted a six-month pilot of the software to see if it would integrate with the company's systems and deliver the information needed.

Although SAS's HCM software comes with many pre-built reports and features, like any other software it required a fair amount of customization. SAS's Silver acted as lead contact. "It started with us talking with the vice president of HR, Dorothy Berry, about her concerns about retaining loan officers," Silver says. "They would hire MBAs out of college who ended up using IFC as a training ground before leaving."