People Analytics: Giving Back-The Way to Move Forward

This is the forth blog in my People Analytics titled blog series. 

The first blog, entitled “People Analytics-It’s about the People not the Numbers” focused on the human side of People Analytics. 

The second blog, entitled “People Analytics: The Robots are Coming (A view of the future and a current AI product review)” focused on the non-human side of People Analytics and provided a current AI product review.

The third blog entitled “People Analytics: Increasing Employee Engagement through Non-Monetary Rewards” focused on the impacts non-monetary rewards have on employee engagement and my thoughts on an innovative rewards vendor. 

This forth blog focuses on the business impacts one HR Analytics consultant can make and advocates for HR Analytics practitioners to volunteer their skills for the greater good.

Caveat: This blog is not meant to recommend any specific software vendor. Therefore, any software mentioned will just be referred to as a product. 

Magical Product Saves the Day (Highest Cost Solution)

Every day on LinkedIn, I read software vendors describing results from their HR Analytics products that contain a predictive feature. This feature is almost always a predictive turnover model that results in an individual risk score. You can’t miss the vendor posts because they always start with something like “Millions saved.” 

When these products are demoed, the vendor shows the results of the prediction feature. These results typically take the form of a list of employee names next to risk scores and other associated employee data. This visually appealing presentation is typically met a “WOW” by the prospect. Most prospects don’t ask how the risk scores were generated, but if they do it requires an additional call from the Sales Rep to the Engineering Team. Another area that isn’t discussed is how to interpret the risk scores and when to take action.

One of the main selling points of these products is Return on Investment (ROI). If the product can decrease your turnover by X%, you will save X amount which will be significantly more than the cost of the product. My view is that many of these products are very useful, while others are snake oil. If the useful ones are applied correctly, they can bring noticeable ROI. However, make no mistake - the leading products in this area can be costly and only well-funded organizations can afford them.

Alternatives to the Magical Product (Low Cost Solution)

There is an alternative to buying one of the above products for organizations that cannot incur significant costs. A single HR Analytics Consultant with statistical modeling experience can build the same types of predictive turnover models with free or low cost statistical single license products. Even more, an HR Analytics consultant with OD intervention experience can advise on turnover reduction action plans. This means the consultant can go far beyond just giving you model results. Specifically, the consultant can create significant ROI but at a much lower cost. Once you take the high software costs out of the equation, the prospect is only looking at a short-term advisory engagement. 

Another Direction (No Cost/Giving Back Solution)

One of my goals this year was to volunteer more. Recently, I’ve been looking on Consulting volunteer sites such as Taproot Foundation and Catchafire trying to find a suitable project that would make a significant business impact. However, helping with a volunteer database for 10-20 hours isn’t my idea of a significant impact. I knew I needed something bigger.

Last week, I had dinner with my friend Chris who is a Hospital Administrator. He talked to me about how high nurse turnover and a shortage of qualified nurses are current HR issues at his hospital. The way he made it sound, these types of HR issues are widespread across US hospitals. Fortunately for Chris, his hospital is well funded and therefore he recently engaged with a leading software vendor to help him with the turnover issue. However, our conversation made me wonder what happens at hospitals experiencing these HR issues that can’t afford leading software or an HR Analytics consultant? I then decided to dig deeper to understand the scope of the HR issues facing hospitals.

My research below shows high costs associated with nurse turnover, a shortage of nurses, and a situation where insufficient staffing leads to more accidents and even more deaths.

Source: NSI 2017 National Health Care Retention & RN Staffing Report:

·      The cost of turnover can have a profound impact on the already diminishing hospital margin and needs to be managed. According to the survey, the average cost of turnover for a bedside RN ranges from $38,900 to $59,700 resulting in the average hospital losing $5.13M – $7.86M, annually. Each percent change in RN turnover will cost/save the average hospital an additional $410,500.  

·      When the labor market tightens, hospitals have historically sought to bridge the gap by utilizing overtime, agency staff and travel nurses. All of which are costly strategies and can lead to issues with quality, safety, physician satisfaction, employee satisfaction and the patient experience.

Source: American Association of Colleges and Nursing-Nursing Shortage Fact Sheet. Note additional sources from the Fact Sheet are cited below:

·      According to the “United States Registered Nurse Workforce Report Card and Shortage Forecast” published in the January 2012 issue of the American Journal of Medical Quality, a shortage of registered nurses is projected to spread across the country between 2009 and 2030. In this state-by-state analysis, the authors forecast the RN shortage to be most intense in the South and the West. 

·      According to the “Nurse Staffing Effects on Patient Outcomes: Safety-Net and Non-Safety-Net Hospitals” study published in the April 2011 issue of Medical Care, higher nurse staffing levels were associated with fewer deaths, lower failure-to-rescue incidents, lower rates of infection, and shorter hospital stays.

·      According to the “Nurse Staffing and Inpatient Hospital Mortality” study published in the March 2011 issue of the New England Journal of Medicine, insufficient nurse staffing was related to higher patient mortality rates. The data also indicated that the mortality risk for patients was about 6% higher on units that were understaffed as compared with fully staffed units.

Based on my research, I was curious if I could have an impact on patient accidents and even mortality rates if I can help a hospital identify the nurses at high risk of leaving and assist with OD interventions? If I go from helping a large corporation (my typical work) to saving lives at a hospital in need, then would that make me go from an HR Analytics SME to an HR Analytics Doctor? I’m willing to see.

Selecting a Deserving Project

I’m announcing my intention to find a deserving hospital for a free (no cost) advisory engagement. Specifically, I will build, test, and deploy a predictive turnover model for a hospital. In addition, I will advise on how to interpret the data results and develop OD interventions based on these results. 

As of now I have started researching potential hospitals (mostly rural) so I can narrow down a list to make a selection. However, I am also open to suggestions of a deserving US hospital that does not have the funds for leading software or an HR Analytics consultant. If you do have a suggestion, feel free to PM me. I will combine my list along with your suggestions and pick the most deserving hospital. 

Finally, I invite my fellow HR Analytics practitioners reading this blog to find ways to volunteer and use your skills in your community. The more business impacts we make, the more people will see the power of HR Analytics.

For more information on supercharging your HR Analytics or Workforce planning programs please contact me on the Lang Analytics site contact page or my LinkedIn page.