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HR Analytics frameworks

HR Analytics frameworks

LAMP
framework

HR
Analytics
Frameworks

Talent ship HCM:21


Framework Framework
LAMP Framework
• The letters in LAMP stand for
• logic
• analytics
• measures
• Process
four critical components of a measurement
system that drives strategic change and
organizational effectiveness.
LAMP : Logic
• The logic element of any measurement system provides the “story” behind
the connections between the numbers and the effects and outcomes. For
example
• “Employee Health, Wellness, and Welfare .” : connections between
health/wellness and employee turnover, performance, and absenteeism
• “The Economic Value of Job Performance” : uses the logic that improving
performance of every product component is not equally valuable
• “service-value-profit” : the connections between HR and management
practices, which affect employee attitudes, engagement, and turnover,
which then affect the experiences of customers, which affect customer-
buying behaviour, which affects sales, which affect profits. Example : Sears,
which showed quantitative relationships among these factors and used
them to change the behaviour of store managers
LAMP : Measure
• quality of HR measures : timeliness, completeness, reliability, and
consistency
• Example : measure employee turnover, performance, engagement,
learning, and absence
• well-known principle is the “80-20 rule,” which suggests that 80 percent of
the important variation in inventory costs or quality is often driven by 20
percent of the inventory items.
• If absence has the most effect in call centers with tight schedules, this
should be very clear in how we measure absenteeism.
LAMP : Analytics
Suppose an organization has data showing that customer attitudes
and purchases are higher in locations with better employee attitudes.
This is called a positive correlation between attitudes and purchases.
customer attitudes and purchases actually cause employee
attitudes. This can happen because stores with more loyal and
committed customers are more pleasant places to work. The
correlation can also result from a third, unmeasured factor. Perhaps
stores in certain locations (such as near a major private university)
attract college-student customers who buy more merchandise or
services and are more enthusiastic and also happen to have access
to college-age students that bring a positive attitude to their work.
Store location turns out to cause both store performance and
employee satisfaction. The point is that a high correlation between
employee attitudes and customer purchases could be due to any or
all of these effects.
Analytics is about drawing the right conclusions from data. It includes
statistics and research design, and it then goes beyond them to
include skill in identifying and articulating key issues, gathering and
using appropriate data within and outside the HR function, setting
the appropriate balance between statistical rigor and practical
relevance, and building analytical competencies throughout the
organization.
LAMP : Process
(Key terms - explain)
• Knowledge
• Change process
HCM : 21 - human capital management for the twenty-first century
• HCM:21 is a four-phase process that starts with scanning the marketplace
and ends with an integrated measurement system. In the middle, it
addresses workforce and succession planning in a new way and shows how
to optimize and synchronize the delivery of HR services.
• HCM:21 is a model and a methodology for managing human capital, talent,
or simply people.
• HCM:21 is the broad strategy that provides the framework for analyzing an
organization’s data. It takes brainstorming lists, interview and survey data,
and market research and organizes these elements around human,
structural, and relational capital phenomena. By applying HRA tools,
predictive management uncovers the connections and interdependencies
among organizational activities. Study of the outcomes at the strategic,
operational, and leading-indicator levels yields insights into the future. It tells
not only what, how, and why something happened yesterday, but, most
importantly, also what is the likelihood of something happening tomorrow.
• Predictive management, or the essence of HCM:21, executes a strategic
scan of the external forces and internal factors that can affect the three
fundamentals of an organization: human, structural, and relational capital.
Human capital is your employees. Structural capital is the things you own,
ranging from patents and copyrights, to software programs and codified
processes, to physical facilities and equipment. Relational capital is the
knowledge and contacts you have with external stakeholders, which
• 1. Scanning. What is going on outside and inside that might
affect future operations?All the external market forces and
internal organizational factors are listed in terms of how they
might affect the organization’s human, structural, and
relational capital. Additionally, the interdependencies and
interactions across these three forms of capital are recognized
and accounted for.

• 2. Planning. Workforce planning is reconstituted as capability


development. The industrial-era, gap-analysis, structure-focused
model is replaced with an agile system focused on building
sustainable human capability rather than filling positions; in fact,
many of those older positions will be restructured or eliminated.

• 3. Producing. Human resources services are studied as


processes with inputs, throughputs, and outputs. Statistical
analysis is applied to uncover the most cost-effective
combination of inputs and throughputs to drive desired outputs.

• 4. Predicting. A three-point measurement system is designed to


include strategic, operational, and leading indicators. The causal
and correlation aspects of the three points are used to tell a
comprehensive story.
s the four phases of HCM:21 and the arrows indicate how
predictive analytics link the phases
Talentship framework
Efficiency
• The efficiency anchor point focuses on what resources
are used to deliver HR practices. Typical indicators of
efficiency would be cost-per-hire and time to fill
vacancies. As noted earlier, when applied to
sustainability, efficiency would focus on the resources
used to bring HR practices into compliance or to provide
incentives that reflect community, environmental, or
social goals.
• Effectiveness
• The effectiveness anchor point focuses on how HR policies and practices
affect the talent pools and organization structures to which they are
directed. Effectiveness refers to the outcomes of HR policies and practices
on human capacity (a combination of capability, opportunity, and motivation)
and the resulting “aligned actions” of the target talent pools. Effectiveness
applied to the traditional financial definition of success might include
measuring whether sales increase for individuals who receive training or
incentives. Effectiveness applied to the sustainability definition of success
would focus on how HR practices affect human capacity and aligned actions
that go beyond traditional job and performance requirements. Capability
might include knowledge about the organization’s social responsibility and
ethics codes. Opportunity might include time off from work to do volunteer
tasks in the local community. Motivation might include employee
perceptions that activities related to sustainability are noticed and rewarded.
• Impact
• Impact reflects the hardest question of the three and
most vividly illustrates the fundamental differences
revealed by a focus on talent decisions, beyond simply
HR service delivery. Impact asks, “How do differences in
the quality or availability of different talent pools affect
strategic success?” This question is a component of
talent segmentation—just as in marketing, where a
component of market segmentation asks, “How do
differences in the buying behaviors of different customer
groups affect strategic success?”

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