Shifting perspectives and sentiment on how to leverage AI and Analytics within HR and Talent.
KPI Myopia: Moving towards post-hoc optimisation to redefine HR effectiveness
The need for innovation in HR analytics
Human resources departments today are navigating uncharted waters. The business environment is evolving at an unprecedented pace, and traditional HR technologies are struggling to keep up. These conventional tools focus on transactional tasks and generating reports—essential functions, but inadequate for the multifaceted challenges that modern organisations face. Effective people management requires more than routine operations; it demands an understanding of complex dynamics such as leadership, engagement, satisfaction, and performance. These areas require a more nuanced approach than what traditional tools offer.
The Case Study of Talent Acquisition
Most organisations pride themselves on the robustness of their talent acquisition processes, employing myriad key performance indicators (KPIs) to measure success. These KPIs include cost-per-hire, time-to-hire, quality-of-hire, applicant-to-hire ratio, candidate experience, retention rates, and many others. While these metrics provide insights into certain aspects of the hiring process, they often fail to address the ultimate measure of success: productivity and effectiveness of the hires.
The Limitations of Current HR Technologies
Many HR technologies claim to revolutionise the hiring process through innovative methods like video interviews and keyword matching algorithms. Companies spend millions on these solutions, believing they enhance efficiency. However, these technologies only address fragments of the recruitment process. The emphasis tends to be on superficial efficiency metrics, such as reduced time and cost to hire, rather than the actual effectiveness and productivity of the hires.
Functional KPIs can Create a Siloed Mindset
Focusing on niche KPIs can distort the broader view and objectives of organisations. For example, utilising AI for video interviews or CV keyword matching tools may streamline the process upstream, but these methods do not necessarily ensure that staff being hired will be productive. It is not enough to simply fill positions quickly and cheaply if the hires do not contribute meaningfully to the organisation’s goals downstream.
A Broader Analytical Approach to Track Hiring Effectiveness
VM Edge by Trusted Data provides added objectivity to talent acquisition by focusing on the end-to-end effectiveness of the hiring process. Our technology goes beyond traditional efficiency metrics to evaluate whether the hires genuinely contribute to the business. VM Edge achieves this through post-hoc optimisation, a process that redefines how organisations assess and improve their talent acquisition strategies.
Post Hoc Optimisation in Talent Acquisition
The traditional approach to talent acquisition has long been dominated by efficiency-driven metrics, which often neglect the importance of productivity and effectiveness. VM Edge challenges this paradigm by offering a comprehensive solution that addresses both sides of the equation with Post-Hoc Optimisation.
Post-hoc optimisation involves an in-depth analysis of the outcomes of the hiring process to determine the actual value and effectiveness of the hires.
Traditional KPI-centric View
%
Reduction in Time to Hire (YoY)
Post Hoc Optimised View
%
Greater probability that hires in the last year are classified in the lowest talent group
Here is how post-hoc optimisation works:
Multi-faceted Evaluation of Hires
VM Edge assesses the performance and productivity of hires after they have been on the job for a while. This evaluation considers various factors, including job performance, mapped competencies, contribution to team objectives, and overall modelled value to the organisation.
Feedback Loop Creation
Based on the performance data, VM Edge creates a feedback loop that informs future hiring decisions. This means that the system learns from past hiring outcomes and continuously seeks to improve the hiring methodology.
Channel Optimisation
VM Edge optimises the recruitment channels by identifying which sources yield the most productive employees. This could mean focusing more on certain job boards, refining the keyword matching algorithms, or even refining the interview process.
Balancing Efficiency & Productivity
The ultimate goal of VM Edge is to align efficiency with productivity. It ensures that the hires not only meet the efficiency KPIs but also contribute significantly to the organisation’s success. This dual focus guarantees that the hiring process is both cost-effective, reflective and outcome-oriented.
Conclusion: Embracing a Data-Driven HR Future
In conclusion, the innovation of VM Edge marks a significant advancement in HR technology.
By addressing the limitations of traditional HR systems and focusing on both efficiency and productivity, VM Edge provides a comprehensive solution to the complex challenges of talent acquisition. Through post-hoc optimisation, continuous improvement, and strategic alignment, VM Edge ensures that organisations can not only attract but also retain and develop the talent they need to succeed.
In a world where managing people is increasingly complex, VM Edge stands out as a powerful tool that evaluates and seeks to optimise the talent acquisition process, making it an indispensable asset for any forward-thinking organisation.
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