CONSULTING FOR THE MIDDLE MARKET

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1 BUSINESS INSIGHTS Big Data & HR s Collaboration in Middle Market Success Examining How Middle Market HR Leaders Can Leverage the Benefits of Big Data Patricia M. Johnson February 20, 2015 CONSULTING FOR THE MIDDLE MARKET The benefits of big data within the HR function are not simply for large enterprises. Middle market companies are also gaining insights, drawing correlations, and leveraging the value of information for recruiting, compensation, training, development, employee satisfaction and many other areas of the HR function.

2 1 BIG DATA AND HR S COLLABORATION IN MIDDLE MARKET SUCCESS EXAMINING HOW MIDDLE MARKET HR LEADERS CAN LEVERAGE THE BENEFITS OF BIG DATA OVERVIEW In the marketplace Big Data has received great emphasis and press, topping the -charts of business research. Big Data usage has become a vital arena for successful enterprises guiding key strategic initiatives and enabling fine tuning to garner strategic goal attainment and advantage. Rich, abundant information is being tracked on customers, potential customers, competitors, markets, and industries (external data), as well as all manner of enterprise dealings (internal data). Businesses that effectively use and gain understanding and value from accurate and real-time Big Data and then respond timely and preemptively to customers have a distinctive market advantage. Insights for making decisions, uncovered through sourcing and interpreting Big Data analytics, have been changing the way companies compete and innovate, especially for middle market companies. Middle Market businesses are beginning to play and even win against some of the big boys strategically positioning themselves, gaining insights, and taking timely, actionable steps to contend with the large corporations, who had been historically richer in resources and more experienced in mining and cashing in on insights from big data. So, what does HR have to do with Big Data? The answer is plenty. Analysts are not just needed in finance, sales, supply chain, and operations, but across all enterprise functions including in HR. As we know, HR s focus is on people and talent hiring the right people, putting them in the right positions, and retaining their services. HR s chief aims are to enable business and their leaders to reach their strategic goals through people.

3 2 Middle market business leaders, including HR professionals, are positioned to take advantage of growth opportunities in the current business and economic market climates. They will do well to collaborate in using Big Data by: establishing the right focus; creating the right culture; sourcing the right talent; mining the right data; making the right decisions; and taking the right actions. ESTABLISHING THE RIGHT FOCUS Business leaders and HR professionals are to be mindful of the current operational and analytical competence of their organizations with an eye on the road ahead. They benefit by operating in the marketplace with a keen awareness of their identity, their organizations strengths, weaknesses, and more, and alert to opportunities, threats, and conditions from the outside. Big Data insights can enable organizations to nimbly and proficiently take advantage of opportunities for growth and strengthening, while minimizing threats and weaknesses, as they journey. Essential to operating as a smooth-running engine, businesses must keep each part/business unit empowered, well-managed, and monitored to operate as close to optimal as possible. Effective use of analytics are designed to do just that. Organizations inexperienced in the use of Big data may benefit by using a smaller-scale approach. This can entail keeping a particular system tuned and running, while building and bringing online other systems until the vehicle is tooling down the road sleek and adept. As critical talent become data competent and as tools and systems are acquired or updated medium-sized businesses experience an improved outlook. CREATING THE RIGHT CULTURE Mid-market business leaders that value, reinforce, and reward change esteem it in their cultures, model it, communicate it with anticipation, joy, and logic, and encourage acceptance of it through empathizing with employee misgivings, will reap the fruit of transformation. Change and innovation are tantamount to market growth and expansion. They are forged in cultures where suggestions are welcome, mistakes are stepping stones, and passion for learning and overcoming challenges abounds. Change is deeper than do. It is what an organization becomes - a change agent. Agility, responsiveness through uncomplicated organizational structures enabling crisp, decisive decision-making and action, prepares medium-sized companies for nimble market ascension. By building reactive climates, these businesses are primed to embrace the next seed or even the next wave of disruption through change that is undergirded by and motivated by Big Data. HR professionals collaborate with enterprise leaders to build a culture of change, dexterity, and cooperation that will enable companies to get to the next growth tier. HR finds people who will be a match for and reinforce the

4 3 company culture and values - empowering talent retention, satisfaction, and engagement, and company enhancement. SOURCING THE RIGHT TALENT HR professionals work in partnership with middle market leaders to recruit and hire the right talent for present and predictive company talent requirements. This can include hiring people with analytical prowess in every business unit in response to expanding Big Data opportunities. Though, the rapid growth of Big Data is creating a short-fall of qualified talent. HR s response has been to deliver training for leaders and key unit talent with analytical skills or aptitudes, and express a commitment to learn. HR departments, themselves, most often are hugely lacking in analytical talent. Performance management tools and processes can be adjusted to stimulate and monitor this essential analytical skill development. As insights are gained from big data, redeployment of employees may be in order. After HR professionals and other enterprise leaders work together to establish plans to source initiatives or newly-formed strategic objectives, employees may be deployed to different positions, business units, or locations in response to data-driven needs shortfalls or excesses of human capital. MINING THE RIGHT DATA For some mid-market businesses, the right data may be ascertained to be the data that is readily available. The right data could be a combination of statistical comparative information in a given context, metrics relating variables, or basic measures in various combinations. Leaders in businesses who are just entering the space of big data seem to be overwhelmed with its pure velocity, volume, and variety seemingly drowning in it, barely surviving the deluge. Leaders experienced with managing big data tend to use it for expansion and growth, while analytic sophisticates aim to innovate from data insights. The foremost challenge for analytic practitioners is to discover key indicators related to organizational information on in-house products, services, strategic goals, business units processes (i.e. financial, supply chain ), employee performance, and benchmarks of competitors. HR can provide or arrange training hire adept analytical middle market consultants, that can help middle market business leaders sort through the mass of accumulated data, find lost data, or retrieve data to find the pearls of great price. Resourceful business and HR leaders will find ways/experts to help them to achieve their aims and ambitions. MAKING THE RIGHT DECISIONS In business, as in life, it s impossible to make all the right decisions. If the 80/20 Rule is applied here, only 20% of decisions need to be on track to effectuate an 80% impact. That is good news to all leaders no matter their competence with analytics. Getting a few decisions right can make all the difference.

5 4 Big Data could provide increased factual and predictive information to drive decisions through correlational, causative, or historical comparisons and competitive benchmarking. Not surprisingly, top performing companies tend to rely on analytics 5x s more than their lower performing competitors. Evidence that informed decisionmaking generally outperforms instinctually made decisions. Even better, cloud computing makes compiling big data secure, cost effective, and customizable to the needs of medium sized-businesses and their leaders. A robust IT system, selected for flexibility, scalability, security, ease of use, and interface capabilities (current & future), or an enterprise resource planning (ERP) system, which integrates all business units, and enables efficiency and problem-solving capabilities within a company can streamline the management of Big Data. In those systems, data is communicated broadly, while strategic initiatives, changes, and gaps are tracked making information and insights freely available. HR can promote the use of data by providing training in the use of key metrics and analytics, communicating measures simply, and assisting in analyzing and interpreting data. Company leaders, including talent leaders, timely, beneficial actions to key analytic interpretations seek to produce new outcomes and quantifiable results within the company and each department. TAKING THE RIGHT ACTIONS Commitment to acting on insights gained from big data is imperative for savvy middle market business leaders. Staying committed to change takes resolve, reinforcement, and recognition of the potency of insights. Those insights are based upon interpretation of, often times, complex data. Changes are implemented by business leadership by cascading, progressive, or organic strategies for employee buy-in. HR plays a significant role in communicating change positively through an array of media interfaces available to employees, while assisting in implementing changes through training, leadership support, and other suitable activities. So, how is understanding translated into effective action? At times the course of action is crystal clear, at other times it s shrouded in uncertainty or a myriad of possibilities. Failures may lead to more insights and deeper resolve. Leaders will be more effective by introducing only one, or at the most two, significant initiatives at a time, so as to not overwhelm or demotivate employees or short-change initiative results. Evaluation and refinement of initiatives will continue as more big data insights are gained.

6 5 CONCLUSION Now and in the future, HR will be taxed to find enough talent proficient in managing and interpreting analytics, and ensuring employees critical to the organization s success receive proper training with regard to big data. Changes brought about by Big Data will also stretch HR resources in both the preparation and implementation phases. Big Data is here to stay and is expanding, seemingly, exponentially. Reliance on it will continue to grow and its accuracy will continue to improve. Rather than Big Data being focused on historical data, an increasing emphasis will be placed on forecasting helping businesses to position themselves to meet future challenges and opportunities. Many top middle market businesses and their leaders already see and are enjoying the vitality and possibilities of Big Data. It s time for more Middle Market leaders to catch this wave and to see how far it will take them and their businesses. AUTHOR Patricia M. Johnson, Co-Founder, Chief Talent Office of Meris Consulting, LLC, a full-service consulting firm dedicated to helping middle market leaders and their teams flourish. Pat s professional career started in business in training & development for Marshall s, Inc., and took a highly treasured turn into raising a family and volunteering (domestically & internationally), before returning to professional work as a licensed marriage & family therapist. Passionate about people and forming meaningful relationships, Pat helps middle market executives see the transformational power of connected leadership. Meris Consulting, LLC 1790 Hughes Landing Blvd. Suite 400 The Woodlands, TX USA

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