Hosts Stacey Harris and John Sumser discuss important news and topics in recruiting and HR technology. Listen live every Thursday at 7AM Pacific – 10AM Eastern, or catch up on full episodes with transcriptions here.
HR Tech Weekly
Episode: 63
Air Date: March 24, 2016
This Week
This week John and Stacey discuss:
- Business Intelligence: Gartner Demotes Former Market Leaders, Now Seen as Laggards, and Oracle is Dropped Completely » Link
- Muse launches new Coach Connect services to provide professional coaching in interview prep, negotiation, and leadership » Link
- PwC prioritizes student loan debt repayment benefits » Link
- IBM and the Great Divide in HR » Link
About HR Tech Weekly
Hosts Stacey Harris and John Sumser discuss important news and topics in recruiting and HR technology. Listen live every Thursday at 7AM Pacific – 10AM Eastern, or catch up on full episodes with transcriptions here.
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- Downloadable MP3 File HR Tech Weekly: Episode 63: With Stacey Harris and John Sumser
Transcript
Begin Transcript
| John Sumser: | Good afternoon, and welcome to HR Tech Weekly, One Step Closer, with Stacey Harris and John Sumser. This is our 63rd show. How are you, Stacey?
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| Stacey Harris: | I’m doing well this week, John, doing well, looking forward to a little bit of time off next week with spring break with my family. I think many people are going on holiday this weekend, so it will be a nice little break. We’re changing our time a little bit today, so it’s a little bit later in my day, as well as yours, so I think we’re both a little bit more awake today as well.
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| John Sumser: | We’ll see if that helps or hurts. I wish I knew exactly what time this was because I’m in some new time zone and having a hard time with it. Daylight savings time plus a time zone switch is just too much for me.
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| Stacey Harris: | Too much, yeah, too much all at once, yeah. Where are you at today, John? You [crosstalk 00:01:11] …
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| John Sumser: | I am in Minneapolis. I delivered the keynote opening talk for MinneAnalytics, which is a group of 900 people in Minneapolis who are interested in people analytics. Fascinating, fascinating. It’s the highest concentration of people like that I believe I’ve seen anywhere.
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| Stacey Harris: | I was going to say, 900 people excited about people analytics. I thought there wasn’t 900 in all of the states that were excited about people analytics, so that must be a huge crowd.
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| John Sumser: | It was pretty interesting. They had 40 different speaking slots, 40, and I haven’t seen anything on that scale yet that’s specifically interested in analytics. It’s crazy. Then what you realize is Minneapolis is a central part of the story of HR technology, which this is a subset of. Minneapolis is where Ceridian was located when Ceridian developed the first fully fledged piece of HR software in like …
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| Stacey Harris: | That was very early days, yeah.
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| John Sumser: | … 1250 or 1310, way back when they were using those stone age computers. There a host of other things, like the University of Minnesota is really ground zero for I-O psychology. All of the major personality assessment companies, the really big ones, have their roots in Minneapolis, and the curriculum at the I-O school in Minneapolis has driven lots and lots and lots of research over the years. It’s a very interesting place. Analytics is just the next generation of I-O psychology in some ways. It was very cool to come here and see that there’s a culture, there’s a community and a culture of people analytics in Minneapolis. Who would have thought …
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| Stacey Harris: | My bet would be that there would be a lot of people elsewhere out in the market who would love to see that type of a culture grow up in all their own communities as well, because I think it tends to be a very lonely place sometimes when you’re working on HR analytics and people analytics in many organizations and cities because it’s not an area where you see a lot of people who have expertise who truly understand it. I would say that that would have been a fun group to be a part of. Probably a lot of [client 00:04:06] jokes going on there.
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| John Sumser: | Yeah, and a lot of measurement geeks, lots and lots of measurement geeks. It’s very interesting. The way that HR analytics hits the business world is not going to look very much like what you could see today at this event in Minneapolis. It’s still too academic. It’s still too focused on having all of the right capacity first before you produce results rather than producing results and then building the capacity. Did I tell you about the video course I took online [crosstalk 00:04:54].
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| Stacey Harris: | You were talking a little bit about it, yeah. In analytics, wasn’t it, in HR analytics?
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| John Sumser: | In analytics, yeah. David [Krielman 00:05:00], who’s this pretty smart Canadian guy who’s been at the hard end of HR for his entire career, put together this really wonderful hour. In the hour, what he said was, “What you really need to do to get analytics right is start by solving little problems, not by building a great big capability.” It’s an important and useful message.
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| Stacey Harris: | I know back in the days when I was doing the early HR analytics research, back when I was working with [Burke 00:05:39] and Associates, one of the best studies that I still to this day am able to bring out was a large organization, a large global pharmaceutical organization that had worked for three years just trying to get some reporting across the company that worked. They finally came down to 40 fields. If they could get 40 fields that everybody agreed on, that was enough to start doing analytics in their company, so I think that’s right. It’s really a matter of sometimes starting small.
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| The news this week, there’s a lot of news going on, but it falls into some of this conversation, so I think we can definitely pull some of your work that you’ve been doing in Minneapolis into some of the interesting stuff in the mailbag this week. Before we dive into the article though, I do want to just say that our thoughts and prayers go out to those who were affected by the terror attacks in Brussels. We’re hoping we won’t have too many more of those, but that was definitely a big part of the news this week. We didn’t see a lot of other HR tech news that jumped off the screen this week, but we did have I think a lot of interesting topics that will probably make for some good conversations today, John, as far as the way people are thinking about redefining not just HR analytics but HR because of the data capabilities we have.
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| The first article that I pulled today, which is right along with what you were talking about, is that Gartner’s, and Gartner’s has always been known for their famous Magic Quadrants and how they’ve positioned all the various technologies, business intelligence, HR, other marketing and business softwares and technologies in the market as either challengers, leaders, they’re visionaries, or niche players. The BI analytics space, particularly business intelligence space, Gartner’s been assessing for several years now. They basically revamped their whole way of looking at things, from understanding, and this came out just late February, the earlier part of this month or the latter part of last month.
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| In revamping their measurements of the business intelligence market, the long term players, SAP, IBM, Microsoft, Oracle, MicroStrategy, and [SAP 00:07:50], all dropped out of what would be considered the leaders’ quadrant. I think sometimes you can have a conversation about how accurate is Gartner, such as any other research firm doing this kind of work, but I think what was more interesting was this idea that this market is changing so much that they revamped the whole picture that they’re making assessments based off, and it basically took out most of the large players. The only leaders that were left in their quadrant assessment was Tableau, Click, and Microsoft, and they’re all at the bottom of the that leaders’ quadrant.
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| John, does this surprise you? Do you think this is worth people paying attention to, that many of the large players in business intelligence are being downgraded as far as their innovation, their ability to lead, their ability to change this market now, or do you think that this is what we would expect with an industry that’s going through these kind of cycles?
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| John Sumser: | I probably have two opinions here. Opinion one is this kind of research is almost a horse race that vendors have with each other, and there’s a certain class of client who wants to be part of a juggernaut that’s an industry leader juggernaut. I’m not sure I believe that the world could be subdivided into four nice, neat quadrants and that somehow some consultancy can be objective enough to get the people in the right slots. I’m going to just put my $5 on doubting that. That said, that said, one of the most difficult problems with analytics today is if I’ve talked to 1000 people about analytics, I would say that I got several hundred different definitions of analytics and that, really, the most common definition for analytics is something like, “That scary stuff I don’t understand.” From there it ranges from, in what country is a graphic visualization tool a business intelligence tool? That’s [putting 00:10:30] Tableau … Isn’t that top quarter?
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| Stacey Harris: | Exactly.
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| John Sumser: | What? No, no, but Tableau is a piece of a really great analytics workbench. What I’m starting to imagine is [inaudible 00:10:46], I think that I can identify 20 or 22 different technologies that are used by expert analytics people to build analytics, and they range from some fundamental kinds of data manipulation to model development to narrative visualization to graphic visualization to data mining. There’s just a huge slug of stuff that goes on at being part of analytics, and what will fill in an empty top quarter is a tool that allows somebody who’s pretty good to deliver Bespoke analytics solutions for Bespoke problems.
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| Stacey Harris: | Yep.
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| John Sumser: | That’s really what’s going on with analytics is different companies need to know different things, and what’s good in one company is not inherently good in another company, so we’re discovering that this branch of HR is like recruiting and learning and perhaps performance management, where you have a universe of tools that you use to solve your company’s specific problem.
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| Stacey Harris: | I think it’s really very similar to where learning was. I think we hit on this a little bit last week. If you look at the learning industry ten years ago when it was just starting out, no one would have thought that an LMS included content creation tools, and video playing tools, and social conversation tools. That just wasn’t … An LMS was a tool that tracked someone registering and un-registering into courses. I think that’s exactly where business intelligence and analytics is, is that no one really knows what goes into a true analytics package, so the world is changing the definition. I think you’re right on track with that. The only challenge I would make with this is that I think, at least from what I’m seeing and you might know these vendors better than I do, but at least on the HR side, none of these vendors are openly admitting that they don’t have everything.
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| It’s like, “It’s good enough to have just what we’re currently offering as a data warehousing tool with some visualization” instead of saying, “We need to create better relationships. We need to create better ways to get data across all these tools,” which is part of the reason why Microsoft Excel continues to grow, because people need to get data in and out of these systems, and they can’t do it across the system. It’ll be interesting to see if these vendors are willing to back down and start to look much more like our solutions and talent in the HR and learning bid, which is we need to start connecting the dots even if we can’t do it as a system but as a vendor.
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| John Sumser: | The only disagreement I have with your last characterization is I think that as a tool, Microsoft Excel is some kind of amazing. It’s really some kind of amazing. It gets used by so many people to do so many things, and I think that tells you that Microsoft Excel is how an entire class of people actually do this stuff. That may not sell a lot more new software licenses, but it’s really worth understanding that there are very competent people out there who get analytics done with very rudimentary tools. That probably in and of itself explains why sales in the analytics sector have not been particularly interesting yet.
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| Stacey Harris: | Maybe another way to look at this is diving into some of the other articles that I pulled this week, is understanding where some of this new data is going to be coming from. One of the things that I pulled in the database was that Muse is launching a new coaching service to help their members achieve what they’re calling their dream careers. Muse is an online buy as you need it career planning/resume building/solution, which is very similar to any other career management type of end user tools that we’ve seen in the market previously, but I think it’s a little bit more millennial focused, and definitely I think the millennials are much more interested in managing their own careers outside of their individual companies.
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| Muse might have a better opportunity to do this. It’s similar in a lot of cases to what you see coming out of onboarding or off-boarding organizations or outplacement organizations, but they’ve put it online. You know this company a little bit better probably than I do. This is some of the things that I think we’re going to be looking at, where new data is coming from a career coaching site that has nothing to do with the company that you’re talking about. This would have interesting data that you’d want to have in HR analytics, but it’s the employees’ data, if I understand how this system works correctly, correct?
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| John Sumser: | I don’t have the slightest idea who owns what pieces of the data here, but what you see, I think, with the Muse story is that the idea that software as a service had a big “S” and a little “s” in it. Software was the big “S,” service was the little “s”. We’re seeing over and over and over again the emergence of new business models that have more labor costs in them, and this would be one of those. The Muse, the team at the Muse, are so sophisticated that they wouldn’t make a move like that unless it was well thought out and cleared through the kinds of people who invest in next generation recruitment media companies.
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| Stacey Harris: | The new technology is offering interview coaching, negotiation coaching, and leadership coaching, which are all things, and I can go back to my own career which I have thought, “Boy, you know, I would love for a company to invest in me in this way.” Everybody hopes they get some sort of development in that type of arena. Muse is saying, “Come here and you develop yourself,” this idea of individual development at an employee level, their own ownership of it.
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| John Sumser: | Another way of thinking about what they’re doing at the Muse is that they are disrupting recruiting, and instead of a headhunter who might pick you out of the crowd to do this for you, you can buy that service that the headhunter would provide if you met the grade, through the Muse at some sort of optimized price point, which means they put candidates in deeper control over the recruiting process.
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| Stacey Harris: | The process, yeah.
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| John Sumser: | That’s interesting. That’s interesting.
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| Stacey Harris: | I’m very interested in watching this a bit more. I think there’s a lot more to learn here about not just how they’re doing this from a technology perspective and how that relates to the services, but I do think there’s a data conversation here, because I think as end users become much more focused on owning their own data, there’s going to be much bigger conversations about how that data gets analyzed at any level and who has the ability to analyze that and give some bigger picture answers back. I think you’re going to see less and less data sometimes in the hands of the businesses who are trying to get this analysis because of these type of offerings and services, but we’ll see. It’ll be interesting to see how that data gets integrated into the bigger picture.
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| Some of the other articles that we picked up this week probably doesn’t seem like they’re connected to this, but I think it actually is quite. This idea of creating technology off of these pain points that are very cultural and generational right now. One of the stories I picked up was PWC’s prioritizing student loan debt repayments as part of their benefits packages. I think we’ve all been talking for years about the fact that student loans, particularly here, especially here in the United States, is huge, and a trillion dollar student debt level, but what’s interesting about PWC investing in this and saying that, “We’re going to be offering student debt payment” is that they have connected with a Boston based company, called Gradifi, to administer their program.
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| Gradifi, owned by Tim DeMello, and I haven’t talked or spoken with this organization but I have seen a couple of articles about what they’re doing, is an organization that has basically focused on understanding the student loan problem, getting to know it, really, offering refinancing and all other kind of services for students who are struggling in this, this generation struggling with these challenges. As part of that, they’ve now created technology for the company so that they can administer all of this separately and do it at a much more cost effective cost than what these corporate companies could do themselves. This is actually a really big financial burden.
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| I’ve talked to many organizations who often talk about if they aren’t doing student loan repayment, they’re tax based analysis of their own investment in learning and development, that’s a big issue in many organizations, tracking that tax money they would get based based off of [development 00:20:33] they’re giving people in their organization, and managing any kind of benefits like this can be administratively a burden for those organizations. Do you think we’re going to see more of these type of niche players dealing with cultural issues that are turning them into technologies and service mixes? I think Muse and this company, Gradifi, fall into both those areas.
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| John Sumser: | I think it’s an interesting trend to be watching. It’s an interesting trend to be watching. The other way of saying that is that we’ve run out of things to automate, so now we’re going and looking for [little tiny 00:21:06] things to automate [crosstalk 00:21:08]. Doesn’t this really sound like a drop down menu item on a benefits suite?
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| Stacey Harris: | It could be.
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| John Sumser: | It’s just big, big employee impact but, really, it fits right into the row of the rest of the benefits package.
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| Stacey Harris: | I would agree that it’s big employee impact, but I also think that we oftentimes forget how much money it costs to administer these kinds of programs, because these are the little things that don’t get managed inside the existing systems right now, right?
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| John Sumser: | Right.
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| Stacey Harris: | To your point, yes, we’re maybe getting to the low hanging fruit or to the areas where the big systems hadn’t gotten to, but I think a lot of the reasons these things didn’t get into the systems initially was because they had services that had to go along with them. I think it’s that services conversation that makes it a little more interesting.
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| John Sumser: | Great. Agree.
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| Stacey Harris: | One of the last articles that I pulled, which I think maybe just wraps this whole conversation together was Peter Cappelli wrote one of his many famous articles in HR Executive Magazine this week about what he’s calling the individualized employee model, so his article on IBM’s recent foray into improving the experience of individual employees highlights how big a break a personalized approach would be from the past ideal of simply treating everyone equally.
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| We’ve been talking about this for a long time, but Peter seemed to really think that this was all of a sudden really changing how we’re thinking about management, which is that IBM is basically revamping their entire HR process, which they’ve been on this road for a long time, but he quoted Diana Gherson, the senior vice-president and head of HR at IBM as mentioning that they’re on this three phase model where the third phase, which they’re working on right now, is basically now taking all this data that they’ve been gathering and instead of trying to make sure that everybody is treated fairly, which has been the mantra of HR for how many years, everybody is now treated individually as they want to be treated based off of the data you now have in your system.
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| He brings to bear some interesting examples, such as talent quadrants, data about whether or not people might be flight risks, and talent analytics that go into recruiting processes as the examples of how this is being done. Me and you have talked about this. What do you think about this article? Do you think it’s on track? Do you think we’re … Is this a little bit something we’ve been talking about for a while and maybe is just starting to get some more feet now?
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| John Sumser: | In a certain range of companies, a new-ish model is maybe emerging. That new-ish model is, let’s see if I can get it right, is that you can find a lot of economic benefit by looking more carefully at the people who work for you. Now I don’t think this works in companies under 1000 or 2000, but once you get over a couple thousand employees, rethinking how you think about them is pretty important. You start to have things like an enormous pile of resumes that have come in over the transom that you can mine for information about the hiring process. There are vendors emerging who can tell you the degree to which some of your employees are vulnerable to recruiting. There’s a lot of really interesting additional information that you can learn about the individuals who work for you. Now whether or not that is a good thing or a bad thing, I think the jury’s out on that. I heard a guy today who said, “These sorts of analytics projects, while they don’t introduce bias into the system, they can wildly amplify the bias that already exists in the system.” Does that make sense?
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| Stacey Harris: | I think it makes complete sense. It’s one of the risks I’ve been warning people about, is that if your system … If you are unaware of what your existing data is, your existing issues are, you can just basically build a house of cards on top of them without realizing the foundation’s already bad, right?
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| John Sumser: | That’s right. That’s right. Part of what that says is we’re about to come upon a very interesting time during which the diagnosis of organizational behavior, diagnosis of categorization of organizational behavior, is going to get very sophisticated. You can imagine, I do, that there are multiple acceptable, effective models of how to deploy human capital in a work system. Why wouldn’t there be? The predominant model is something like, get all the people you can, and put them in a cage, and never let them out. It was outlawed a long time ago, but it’s still the sentimental favorite.
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| Then there are better models that are like the organization is a compost pile. If you keep stirring it up, the talent will get more effectively spread around. I think there’s a dozen models like that. Different companies use them in different ways, and analytics mean different things based on how companies utilize the stuff. An external rating of a 73 as a flight risk because Google just opened a plant next door or something, that’s interesting unless really good is 40 and they’re happy to see the 73s go, which it might be.
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| Stacey Harris: | That I think is the real risk in a lot of this, is the assumption of looking at this data and having a perspective, and I’ve often said this about kind of HR analytics, is that having a perspective about what is good or bad. The one thing about data is that data has no perspective on it. It is data. We put our own perceptions on it, and we put the own definitions of what’s good or bad about that data, and what you just explained. There was a really good example of one way of looking at it, saying that, “Look, for one person, 40 is bad. For another person, 70 is bad.” You really as a company have to define what it is that you’re trying to achieve and then look at your data through those lens.
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| Oftentimes when we talk about individualizing HR, and I’ve been a big proponent of this for a very long time, back in some of my very first reports was that now we have the data to look at people as individual human beings, instead of thinking about it as ways to make and optimize the work that’s going on in our companies, we might want to maybe think a little bit more about how we try and provide the employees with better ways to make decisions as well. I think that’s the other side of this individual conversation.
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| John Sumser: | I’ve got to tell you a funny story from today. I have a good friend here in Minneapolis, and he was sitting in the front row, making silly faces at me while I was doing my talk, so I used him as an example of a flight risk story. I said, “Paul here, Paul here is a 73.” It hurt his feelings, because he thinks he’s a 90. It doesn’t matter in what. He thinks he’s a 90. When I called him the 73, it made his day a little less good. That’s one of those things that people who do analytics simply don’t think about, that being labeled means something to people, and they’re not always happy to be labeled.
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| Stacey Harris: | Yeah, exactly, yeah. By us putting business type labels on it and [inaudible 00:29:57], instead of looking at the data as just what it is, which is data for helping people to make decisions, that can be some of the biggest challenges that we have. The bigger question is how do you make sense of it then if you don’t put people into categories, or things into categories?
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| John Sumser: | Yes, yes, yes, there’s two sides to the argument. It still doesn’t feel good to be thrown in a box as a number.
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| Stacey Harris: | No. John, we’ve hit the end of our half hour already. It’s been a fun conversation. Not a lot of big, big news but lots of interesting I think nuances to what’s happening in the HR tech space and how it’s going to impact people who are making decisions there right now.
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| John Sumser: | I do have to tell you that lots of people in Minneapolis came up and talked to me about our show and how they couldn’t understand how you put up with me because you were the important part of the thing, so we’re big in Minneapolis.
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| Stacey Harris: | That is very nice to hear. A shout out to all of our Minneapolis friends and people listening to the show and, yes, John is so hard to put up with, but as you can tell, he definitely makes the day for me because he makes me laugh, which is more important than almost anything these days.
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| John Sumser: | With that, we will bid our intrepid audience a fond adieu. Thanks, Stacey, for doing this.
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| Stacey Harris: | Yep.
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| John Sumser: | We will see you all next week, same time. Bye-bye.
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| Stacey Harris: | Thanks, everyone. Bye.
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End Transcript
