Summer weekends are the perfect time to catch up on reading and to think about things we often don’t have time to think about during the hustle and bustle of a “typical” business week.  This weekend I had the opportunity of reading an excellent article in the Harvard Business Review by Wharton School professor Peter Cappelli titled “There is No Such Thing as Big Data in HR.”  Peter is the George W. Taylor Professor of Management and is world renown for his work in the area of Human Resources.  In the HBR article, Peter shares his insights that while the rest of the world is just leveraging the power of big data analytics and is on the cusp of introducing Artificial Intelligence (AI) into the equation, even the largest business organizations on the planet only employ a couple of hundred thousand employees so by definition, it’s impossible to gain insights from “big data” because there simply isn’t enough big data to analyze.

Peter’s macro-perspectives are solid and provide strong logic for what some of the current data can be used for on a micro level and how straightforward database integrations of various HR sources can provide leaders with the data needed to make good business decisions.  For example, Peter shares ideas for basic analytics around employee engagement and the relationship between employee acquisition and business performance all which make a lot of good sense and are very valuable ideas.

While Peter’s perspective may sufficiently define the current state related to leveraging big data in HR, I am convinced the future state – especially in the part of HR that focuses on Learning and Development – will be different.  Learning and development is continuing to experience disruptive changes and the use of big data analytics in the near future could mean the difference between business success and failure.

During the past year, I designed, developed, and have delivered a “driverless” First-Line Leadership Business Simulation for new millennial leaders that is providing big data and intense analytics across the global spectrum of multiple companies.  This leadership business simulation presents participants with the opportunity of becoming a new leader in a simulated world of avatars with different personality styles and job descriptions.  Participants are required to lead a team and execute the strategy of the organization they work for by effectively running their department.  The new leaders participating in the simulation go through the experience in a “flipped-classroom” as there is no stand-up instruction or content; if participants want to explore a concept such as coaching, giving, feedback, understanding business strategy, or leading innovation, they click on a “Digging Deeper” in-the-moment micro-lesson that it embedded in the simulation, learn about the topic, discuss the topic with their cohort, and then apply it directly in the simulation. 

In one pivotal scenario of the simulation, Ellen Astor, a former peer who is a top performer but also very confrontational and short-tempered engages in a shouting match with Theo Harrington, a happy-go-lucky, pleasant contributor who likes to please other people in his company and on his team.  Ellen’s actions are egregious and some difficult feedback needs to be provided to Ellen. 

This is where I believe the future of data analytics will come in…

Today, based on just a few thousand data points, we can see that 88% of the millennial leaders in one type of company avoid providing Ellen with the hard feedback while 68% of millennial leaders in another company – that has provided their employees with intense training about coaching and feedback – choose the best practice path in terms of how they deal with Ellen.  The learning journey is continuous with months of new scenarios and additional practice around new leadership concepts and application.

In addition to the simulation work, we are also developing AI applications that will integrate with the big data.  These AI applications will be able to instantly analyze micro and macro trends and provide advice, coaching, and feedback.  For example, a participant from one of our business simulations will receive tailored feedback on which additional learning to pursue to close any talent gaps and will be able to access an AI SmartBot to listen to real-world conversations that the participant is engaged in and provide instant advice based on the best content and insight gained through the big data analytics.  The AI database will continue to grow with billions of data points, conversations, and analysis that will provide instant learning and development.

Yes, today big data in HR isn’t needed.  Tomorrow will be a different story…

In a business world that forces organizations to deal with both constant and disruptive changes every day, business leaders within these companies find themselves trying to find the right balance between driving long term performance and surviving through the next quarter.

One of the most critical and foundational elements of being a successful business leader is aligning priorities and goals of the organization or team being led in support of the execution of the business strategy.  Well-intentioned business leaders spend millions of hours having meetings, writing emails, and sending texts that try to create alignment yet are frustrated and ineffective most of the time.  Based on more than 25 years researching and working with leaders, there is an obvious yet neglected reason why despite the hard work and valiant efforts, their business success isn’t met; a lack of basic business acumen.

During a recent leadership development program I conducted for a large global company, my class and I were having a very frank discussion about the differences between success and failure.  One of the participants – a leader in supply chain management – was talking about his goals and objectives and how he felt completely stuck between what he was telling his team to do, what his boss was telling him to so, and what other key stakeholders were telling him to do.

“My boss told me that we have to cut 25% of our operating costs and at least 20% of our raw materials costs as part of the ‘Reduce-Innovate-Deliver’ (RID) program being put into place.  I told my team what we had to do and they complained bitterly because we already have cut things to the bone and cut many of our raw materials vendors to the bone to the point they are making less than 1% margin.  I then got my ass handed to me on a silver platter by the Platform Manager responsible for the product line who was screaming about product quality and customer complaints and returned products.  You can have all the goals and objectives in the world, and I can coach until I am blue in the face, but there is something wrong here.  I don’t know what to do…”

The participant became really emotional and had to leave the room for a quick break.  When he returned, we discussed the situation further to see what skills we could develop and how to address the challenge.  After some more discussion with the participant and a few others in the same business unit, the challenge started to become clearer.

When I asked what the business strategy of their business unit was, and they didn’t have an answer other than to “satisfy customer needs.”

When I asked what are the key financial goals and metrics of success for their business unit, their only response was “achieving the operating budget spend reduction goal.”

So, here is the problem as I discovered through further research and dialogue with the business unit leaders who sent them to the leadership development program: the value proposition of their business unit is innovative product leadership.

Innovative product leadership means investing in R&D and other parts of the business to develop and bring to market new and unique high-quality products that competitors can’t immediately compete with.  Unfortunately, no one in this entire leadership chain has participated in any formal business acumen training to be able to understand the strategy nor the key metrics and goals of the innovation strategy.  Instead, they were being told to cut and manage costs as if they were an operationally efficient low-cost player.  As a result, the supply chain managers were buying cheap, inferior quality raw materials which were resulting in customer complaints and product returns.

Sadly, this is not just an isolated story.  This same leadership archetype is being repeated every day and billions of dollars are being wasted because real alignment of goals and objectives can only be achieved when everyone is talking the language of business including strategy, financial management, measures of business performance, competitor analysis, the voice of the customer, and delivering the right value proposition to the right and targeted customers.