We all know that talent is a company’s most valuable asset. It’s also probably the biggest expense – so why not be more strategic about it? This common mindset has inspired today’s most innovative companies to adopt new, more sophisticated methods of analyzing employee data. People analytics, workforce analytics, talent analytics and HR analytics, terms that are often used interchangeably, have ultimately provided HR with tools to ensure the highest productivity, engagement, and retention of top performers.
Since this trend in HR is only increasing, we sat down with Andrew Levison, Founder and President of Above + Beyond, who gave us great insight into the world of Talent Analytics. A+B has developed a Leadership DNA™ Methodology that delivers critical insights about people in an organization: their preferences, their potential, what makes them more effective, and how they can contribute more to the success of their organization. It ultimately determines what makes people productive and willing to go the extra mile.
Q: What was the driving force behind your decision to use talent analytics to make decisions?
AL: We noticed that most companies rely on subjective criteria, gut instinct and a singular focus on performance to assess, identify and develop their people, but it can often prove costly and inefficient when the chosen person doesn’t fit the culture or possess the right talent.
In search of a solution, we met with OD professionals and experts in talent, and discovered that sport teams are best in class when it comes to talent management. What differentiates them from the rest is their use of data analytics to maximize the potential of their people. Similar to sport teams, we decided to utilize predictive talent analytics to assess, identify and develop employees.
Q: Tell us more about Leadership DNA. How do you use talent analytics at A+B?
AL: The basis for developing DNA follows a big data normative assessment, one that has become an industry standard and a validated assessment tool. These assessments use science and advanced statistical methods to help with selection, training and development decisions, and are based off 35 years of ongoing research into the components that make people successful.
Through our assessments, we interpret data to create ideal success profiles of high potentials and performers, and then assess that against the current state of the client’s organization. We then help our clients customize their training and development based off those results in order to provide the best possible solution for individuals, teams, departments, and the organization at large.
Ultimately, our Leadership DNA™ methodology enables companies to choose staff strategically and multi-dimensionally, which reduces costs and increases efficiencies. With a data-based approach to talent management, organizations can consistently assess, identify and develop the right people with the right potential to catalyze strategy, culture and customer experience.
Q: Tell us some of the things you have uncovered by digging into the data – what trends were you able to observe. Was there anything surprising?
AL: Through our research, although ”successful” leaders have similar character traits, there is one critical trait that is the same across all industries and levels: Self-Management. This character trait, an indicator of person’s ability to thrive in challenging, competitive and unknowing environments, is the most reliable indicator of potential for success that we have found.
Another trait that has evolved, as organizations move from a more hierarchical to collaborative structure, is Independence. We’ve found that “Coach-like leaders”, who are oriented towards teamwork, are the ones that are being rated as high potentials and high performers.
Further to this point, we know from our research that the vast majority of human beings are team-oriented and hard-wired to play on a team. We see this globally. Historically, in the West, independence has been rewarded in the workplace. We know this because our data shows that the majority of senior leaders (mainly baby boomers) in mature organizations are independent.
However, our data is showing that trend to be changing, as successful leaders in today’s workforce are much more hard-wired to play on a team. Collaborative technologies and matrixed workplaces are in part driving this. Demographics play a big role too, as Gen Y now comprises over 50% of our workforce. As more and more Gen X and Gen Y move into management positions, we see the successful ones are much more team-oriented compared to being independent.
Something less predictive that we are seeing is more and more senior leaders are showing lower levels of self-confidence and are not feeling 100% in control. This could be because we live in a much more collaborative world, and working independently in silo’s no longer works.
Q: How do you know that talent analytics works? Do you have any Leadership DNA success stories you’d like to share?
AL: One of our clients, a large retail chain in North America, reduced leadership turnover from 70% to 30% in the first year of using our model. This equated to a $500,000 savings in hiring costs, and 1500 hours saved by managers in the screening and selection of employees.
One of their stores ran an independent case study by hiring half of their employees using our assessment and half without. Those hired with the assessment had 100% retention after 12 months, while only 30% of those without remained.
Another client, a leading logistics company, was able to identify high performers, high potentials and strong professionals at the VP level, which eliminated long-term reliance on expensive recruiting firms. We began by assisting the client in segmenting training dollars in order to redirect the majority of spend towards high performers and high potentials. As a result, training budgets were reduced by 27%. We also reduced job position risk by identifying a larger pool of potential candidates – 0 vacancies after 27 months. Lastly, our model reduced leadership turnover by 80%. Overall, the Leadership DNA process helped them maximize their budget for training and development by segmenting their population, directing their spend, and giving people the exact training they needed in order to realize their potential.
We also helped a global payment company adjust their talent identification process, resulting in a new Performance Management process. The application of this major restructuring process reduced implementation time by 50% and increased accuracy in selection by 90%. Development Dollars were then relocated to specific groups, areas and regions within the company.
The effectiveness of talent analytics can help organizations let go of old-school, institution-based decision making, and move towards a more precise, validated, and objective way to develop people in the workforce. If you are looking to improve the performance of your people, but the old ways of doing that are no longer working, then digging into the data is a great place to start.
Do you know who your top performers are? How much is it costing you when you make an uninformed decision? Contact us today to learn more about Leadership DNA and our talent development programs.