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Who's Really Moving the Big-Data Needle for HR?

My colleagues Cade Massey and Adam Grant put on an interesting conference at Wharton this month with the title of "People Analytics." That title referred to the use of sophisticated analytic techniques to solve human resource problems, aka Big Data Meets HR.

Here's what I thought was interesting about it: They had a huge turnout, not just among MBA students, who did most of the organizing, but also among employers. For people who work around the topic of human resources, that's a big surprise. It's hard to get business students interested in workforce topics. It's even harder to get companies interested in showing up for events on these topics, let alone donating money -- as they did -- to support this event.

Here's the second surprise, or maybe shock, depending on who you are. Most of those people at the conference, both students and employers, weren't interested in human resources. Most of them, frankly, didn't seem to know a lot about it. Who were they? The best label might be engineers, people with a background in industrial engineering and sophisticated applied statistics. The business function where most of these people were located was probably information technology, because that's where most of the data they were using was either based or accessed.

In short, this was not a meeting of HR people who were using sophisticated techniques to answer their questions. This was a meeting of people who know sophisticated techniques who were moving into HR.

A few days later, I was at a presentation by an IT colleague here at Wharton who had done a sophisticated analysis of email traffic for a company, where they were able to determine the type of communication that made employees more productive. The general content of the emails also predicted who was likely to be laid off. The study led to a new arrangement for employees to use in interacting with each other. All very interesting.

Someone in the audience asked where this project was housed in the company. The answer was the CIO's office. What was HR's involvement?  None. HR was seen as an obstacle, likely just to throw up legal concerns.

There is a fair amount of carping among HR experts about big-data researchers, specifically about the things that we already know about HR outcomes that the big data people don't know. This seems to be particularly so for psychologists who have been in the business of studying selection and predicting good hires. Many of the big-data people are indeed trying to predict things that have been studied for some time, including how to predict good hires, improve retention and so forth.

Here's the thing, though. The big-data people aren't reinventing the wheel. They've already found things that traditional HR researchers never knew and, frankly speaking, never thought to ask. One reason is because they have better data. While HR researchers have been kicking around small and simple sets of data, much of it collected decades ago, the big-data people have fresh information on hundreds of thousands of people -- in some cases, millions of people -- and the information includes all kinds of performance measures, attributes of the individual employers, their experience and so forth. There are a lot of new things to look at.