I was talking with a change management peer a few days ago and I was struck by his preoccupations revolving around Big Data. My fellow professional is a very smart guy with a degree in psychology and a wealth of experience dealing with human behaviour.
Why all these worries I wondered? Because it appears that some executives are under the incorrect impression that Big Data is the next panacea that will resolve all their issues relating to attracting and retaining talent. Well, Big Data if used correctly is a powerful ally, but it is not a substitute for competent individuals that deal with human behaviour in an organisation as well as with techniques to hire and retain talent.
Big Data applied to human resources is usually called People Analytics. I am a fan of the clever use (not the abuse) of People Analytics. Why? This is a great chance for the HR function (or any other fancy name is used in your organisation to call it) to finally step up and become a strategic partner of senior executives by using recruitment and retention techniques based on hard fact data. We are not talking about subjective opinions or gut feelings anymore.
You would notice that all the big size consulting companies are starting to offer “off the shelf /ready made” People Analytics solutions. Why? Because in the beginning people were, as it often happens, completely ignored by this discipline. Big Data has been around for more than a decade. Now, in an attempt to create a new revenue stream, people are becoming the target of these tools.
Is all the glitters gold? No, not at all.
One of the problems that I have with “off the shelf/ready made” People Analytics solutions is that they offer exactly the same tools and results for all the companies that are purchasing them!
Let’s make an example: if you buy a Ferrari for a car race and the other racers have a Ford Mondeo you will gain a significant competitive advantage for that race as your car is more powerful, it can reach high level of speed, etc. But if all the other racers buy a Ferrari the competitive advantage will come from somewhere else: e.g. the mechanics, the driver.
In the same way, for People Analytics to be really effective for your organisation it goes down to customisation and to alignment with your business strategy and objectives. It is how you leverage the Big Data that makes the difference.
Therefore, are companies going to get rid of HR people and hire only engineers and individuals that can code? It is extremely unlikely. In fact, if you want to be competitive you need both: talent that can build algorithms and systems to extract and elaborate data. But you still need people that are very well versed and knowledgeable about the human behaviours, how to interpret them and how to implement effective measures when the data has been obtained.
What Big Data will likely do is to finally force the HR department to step up: those that do not embrace Big Data and specifically People Analytics will simply become obsolete. This is the type of HR person the Big Data will make disappear. And to me it does not sound as bad news at all.