Mining the gold: gain competitive advantage through HR data analysis - HR Technology - first of two part series

HR Magazine, Sept, 2003 by Beth Patterson, Steve Lindsey

Employee Development

A key differentiator for many organizations is how well they provide development opportunities for employees. Employee development provides competitive advantage both by enhancing the skills and knowledge of the workforce and by increasing retention rates of key employee groups. Employee development occurs in a number of methods, most notably through formal training programs and development assignments.

Specific data analysis in the area of formal training programs might include:

* Costs. The benefit must outweigh the cost. By compiling training-related expenses, an organization can determine the total cost for each training program by region, location or employee demographic. This data can be compared to impact data to demonstrate return on investment (ROI) for individual training programs.

* Usage. By tracking employee completion and enrollment rates, an organization can determine a measure of program usage. The best training program in the world is useless unless measures are in place to ensure its effective implementation.

* Training impact. Are employees applying what they learned during training? Are specific work-related behaviors changing in accordance with learning objectives? By identifying data elements that can measure pre- and post-training performance, an ROI analysis can be completed to assess the success of a company's training program. For example, an organization could measure sales revenue before and after implementing a sales training program. Another area relating to training impact is its effect on employee retention and advancement. Are employees progressing as expected? Have retention rates improved? Has individual performance improved?

In addition to formal training programs, developmental assignments can be tracked in an HR system. Over time, an organization can construct successful career paths and gain insights into key development needs by analyzing the data available. Skill gap analysis for individual employees can identify gaps to close to meet desired job requirements. Managing investments in all areas related to employee data will not only provide organizational leaders with the confidence that they are getting a return on these investments, but it will also position the future leaders of the organization for success.

To conduct an employee development analysis, answer the following questions:

* Which employees have attended a required training event?

* Which employees are enrolled for a specific training class?

* What is the retention time of employees who have completed a specific development activity?

* What is the correlation between performance ratings and participation in specific development activities?

* What is the correlation between business trait performance and the implementation of a development program?

Your HR management system is running smoothly, and employees and managers have embraced your self-service applications. Are you effectively using the wealth of information that is contained within these systems? Are you leveraging technology to gather and analyze key data that can help you reach your HR management goals? Take the time to determine how you can collect and implement employee data to demonstrate the HR function's value and potential.