Today, I’m excited to feature a guest post by Eva Rykr of iOrgPsych.
To make an improvement, you must start with measuring what you have. To truly know the impact of a change, you must evaluate pre and post. But to make the best decisions, you must discover the seemingly unknowable. It’s not impossible, it just requires that you gather lots and lots of data. This is where analytics comes in.
The concept of business intelligence and evaluation is not new. Data-driven decision making has cut down on operational expenses throughout organizations. For example, data is needed to answer the question, “What is the price point that maximizes both profit margin and volume of sales, while taking into consideration customer characteristics?” But can data help companies gain a competitive advantage? And can it be used in a “soft” area like human resources?
The peer-reviewed research that ends up in Harvard Business Review or your University library is great. It gives us credible information and generalized conclusions that can help us make better decisions in our organizations. But those conclusions heavily depend on the situation. Often, you read it and say… yeah I’d like to try that but how would that interact with the fact that our department is five times the size of the one used in this study?
Do your own research. Your organizational culture is unique. Your collection of programs is unique. The only way to know what you are doing is right is to measure everything you possibly can. With technology, preferably.
Three Basic Analytic Styles
Thoughtful. Think. Collect Data. Do.
This is what the scientists do. It is, generally speaking, the best way — but you need time and resources. You need to be able to think of the interesting questions and devise a plan on how to get to the answer.
Decisive. Do. Collect Data. Think.
Sometimes, the situation calls for making a decision and evaluating it later. It is the quick way and the substandard way. But it is the ideal way when the consequences of failure are not as bad as the consequences of failing to act. Just don’t do this with selection tests.
Exploratory. Collect Data. Think. Do.
When your problem has not been clearly defined and your solution is even more nebulous, it can be difficult to know what to do. This is the method to use when you have no idea what is going on. More information helps in this case.
None of these ever lead to a final conclusion, so you can also add “Repeat.” Research is an ongoing process. The variables involved always change eventually, changing the nature of your conclusions. And arriving at new information almost always leads to new questions.
The competitive advantage comes when you take it all to the next level. When you go above and beyond tallying frequencies (how many PTO days did John take this year?) and computing means (how many PTO days did employees take this year?) and start using predictive modeling to get the answers to the questions you really want to know (does imposing a maximum on PTO increase the amount of time employees spend away from their work?).
Analytics is much more than measurement and evaluation. It is much more than a process or a task. It is a state of mind in individuals and it is a culture in organizations. Consider it a way of decision-making.
Employees hired for their expertise with numbers or trained to recognize their importance are armed with the best evidence and the best quantitative tools. As a result, they make the best decisions: big and small, every day, over and over and over.
- Harvard Business Review, Competing on Analytics
The analytic mindset is rooted in a deep desire to know the results of your actions, systems, and processes – no matter whether that message is positive or negative. It requires a willful attempt to figure out how to tweak what when to get to the outcome you desire. It’s much more proactive than an afterthought, post-implementation. It is the first thing you think to do, every step of the way.
About the Author: Eva Rykr is an Organizational Psychologist and the Director of Learning at EQmentor. She has a passion for applying insights from the world of psychology to make work better, which includes measuring everything. As the author of iOrgPsych, Eva provides a psychological perspective on business, asking the questions, “Why do we do what we do?” and “How can we do it better?”
