Date posted: November 22, 2016
McKinsey just released a list of the 10 most popular articles from the third quarter of McKinsey.com, and one that had caught our eye made the list. “People Analytics Reveals Three Things that HR May Be Getting Wrong” takes a look at how the analysis of big data is helping companies identify, recruit, and reward the best personnel, often with results that are counterintuitive.
Chief financial officers use real-time, forward-looking, integrated analytics to better understand different business lines. And now, chief human-resources officers are starting to deploy predictive talent models that can more effectively—and more rapidly—identify, recruit, develop, and retain the right people. Mapping HR data helps organizations identify current pain points and prioritize future analytics investments. … Surprisingly, however, the data do not always point in the direction that more seasoned HR officers might expect.
The authors cite three examples of this trend:
- Choosing where to cast the recruiting net
An Asian bank had a longstanding practice of recruiting the best and brightest from the highest regarded universities. As part of a major organizational restructuring, they used data analytics to identify high-potential employees, map new roles, and gain better insight into key indicators of performance. What did they find?
- Branch and team structures were highly predictive of financial outcomes.
- A few key roles had a particularly strong impact on the bank’s overall success.
As a result, new organizational structures were built around key teams and talent groups; in many cases, previous assumptions about how to find the right internal people were turned on their heads: The bank had always thought top talent came from top academic programs, but data analysis showed that the most effective employees came from a wider variety of institutions. Further, a correlation was evident between certain employees who were regarded as “top performers” and those who had worked in previous roles, indicating that specific positions could serve as feeders for future highfliers. These findings have changed the way the bank recruits, measures performance, and matches people to roles, resulting in a 26 percent increase in branch productivity and 80 percent higher conversion of new recruits.
- Cutting through the hiring noise and bias
Data analysis can also help organizations eliminate unconscious preferences and biases that can surface even when those responsible have the best of intentions. A professional services company that receives a quarter million job applications annually sought to reduce the costs associated with initial résumé screening—and improve its effectiveness—by introducing advanced automation. They were concerned that automating the process might compromise the goals they had set for hiring more women; but the assumption that screening conducted by humans would increase gender diversity more effectively proved to be incorrect:
The algorithm adapted by HR took into account historical recruiting data, including past applicant résumés and, for those who were extended offers previously, their decisions on whether to accept. When linked to the company’s hiring goals, the model successfully identified those candidates most likely to be hired and automatically passed them on to the next stage of the recruiting process. Those least likely to be hired were automatically rejected. With a clearer field, expert recruiters were freer to focus on the remaining candidates to find the right fit. The savings associated with the automation of this step, which encompassed more than 55 percent of the résumés, delivered a 500 percent return on investment. What’s more, the number of women who passed through automated screening—each one on merit—represented a 15 percent increase over the number who had passed through manual screening.
- Addressing attrition by improving management
A major U.S. insurer had been facing high attrition rates, and initially responded by offering bonuses to managers and employees who opted to remain. This yielded minimum success. Then it gathered data to help create profiles of at-risk workers; the intelligence included a range of information such as demographic profile, professional and educational background, performance ratings, and levels of compensation. By applying sophisticated data analytics, a key finding rose to the fore: Employees in smaller teams, with longer periods between promotions and with lower-performing managers, were more likely to leave. More effective than bonuses was providing greater opportunities for learning, development, and more support from a stronger manager. Consequently, funds were reallocated towards learning development for employees and improved training for managers. Performance and retention both improved, with significant savings to boot.
The authors’ conclusion: “When well applied, people analytics is fairer, has greater impact, and is ultimately more time and cost effective. It can move everyone up the knowledge curve—often times in counterintuitive ways.”
Date posted: November 15, 2016
If I had a nickel for every time I’ve talked to clients—or clients have talked to me—about brand support, I could retire. I could even stop writing this blog. But telling a brand story is something quite different from having a brand platform, and an astonishing number of enterprises don’t differentiate between the two.
In a post on the Type A Communications blog, Carla Johnson does an extraordinary job of defining brand storytelling and detailing why it’s important. Here’s some of what she has to say:
Plain and simple, a brand story is the story of the difference you make in the lives of your customers. While the best approach is to develop a brand story alongside a brand platform, make no mistake that they’re different and have distinct functions. Every company was started for a reason. The founders believed with all their hearts that they could do something better, different, or truly unique that mattered. They believed in a core purpose that they, and only they, could deliver. A company’s brand story is the succinct articulation of that reason. It has nothing to do with the products or services that you sell. Rather, it’s a definitive statement about why your brand exists and the difference you’re trying to make in the world. Three examples:
- Enabling Americans to perform extraordinary acts in the face of emergencies — American Red Cross
- To transform lives for the betterment of society — The University of Texas at Austin
- A relentless ally for the individual investor — Charles Schwab
Why do you need it? A brand story goes beyond branding. I talk to plenty of companies who’ve invested heavily in branding. They’ve endured the belabored process of developing a brand platform but still have nothing original to say about what they do. Besides using a new logo, most marketers don’t know what to do with a brand platform once they have it. Or if they use it, they use it in such a way that it constricts creativity and they function more as a brand cop. Consistency has its place, certainly, but not at the complete exclusion of creativity.
Jackson cites six specific things that brand storytelling enables companies to do:
- It lets you stand out in a noisy marketplace.
The most integral parts of your brand’s story—what you stand for—are what people care about most. No one can copy it. For one, it’s honest and up front. Second, it sounds different from everyone else in the marketplace.
- It increases relevance.
Disrupt expectations. Start talking based on what matters from your customers’ point of view. Think about how you can become more relevant, more often to more people. You brand story takes you away from focusing on what you have to say and points you toward what’s most important to a broader audience.
- It takes the focus off price and lets you compete on value.
When push comes to shove, what do most companies do? They default to features, benefits and, worst of all, price. The only way you’ll get out of the quicksand conversation of price is to tell the story of value. That’s the foundation of your brand story.
- It creates clarity across the organization.
With a brand story in place, decisionmaking becomes easier. You can look at an opportunity or a challenge and ask yourself, “Is this the right thing to do given our story? Does it further our cause?” If it does, you do it. If it doesn’t, you don’t.
- It creates internal aspiration.
Think about the difference you’d feel if you woke up every day knowing you were going to work to update your company’s website verses helping Americans perform extraordinary acts in the face of emergencies. There’s quite a difference, isn’t there? Employees want to perform amazing acts of grandeur for customers. But the problem is that most of them don’t have any idea what that might look like. In fact, a Gallup poll revealed that 41 percent of all employees don’t even know what their company stands for or what makes them different. If you want to catapult your customer service, engrain your brand story within your company and let every employee express it in ways that matter most in their position.
- It improves your bottom line.
While purpose and passion are fabulous, let’s face it—at the end of the day we have to make money to keep the doors open and the lights on. In their book Built to Last, authors Jim Collins and Jerry Porras talk about the increased financial results that companies experience when they let their purpose (story) drive what they do, and they have the values in place to support it. These companies outperform the general market by 15:1 and outperform comparison companies by 16:1. To back that up, John Koer and James Jaskett go further in their book Corporate Culture and Performance, and talk about how companies that have cultures based on their story (purpose) and values out-perform companies that don’t: Revenues grew four times faster, jobs created were seven times greater, and stock prices grew 12 times faster.
For anyone involved in brand marketing, Johnson’s post is essential reading. We recommend you go to the site and read it in full detail.
Date posted: November 8, 2016
In a recent column on Automation.com, Bob Hillier, managing director of Design Rule, detailed some thoughts on what enterprises should consider when researching PLM solutions. In particular, he points to four areas:
- Compatibility with existing systems
When engaging a PLM provider, one of the key things to consider is whether they will carry out compatibility tests upon implementation. For example, for engineering and design companies, it’s important to ensure new software works well with the computer-aided design (CAD) tools already installed and integrate to other business systems, like ERP. Many companies today use an internal portal to manage document sharing and work management. However, these sharing points should not be used to manage product lifecycle and related documentation because of limited security. Ideally, a PLM vendor should not only provide the software, it should also implement it. This way, if any problems occur during set-up, you have only one supplier to kick.
- Current non-value activity
Many companies decide to implement PLM because their existing processes are taking too long and errors happen on a regular basis. Both issues cause excessive non-value added activity (NVA) and increase the amount of time it takes the company to deliver a product or service. Two of the main reasons errors occur include working with incorrect data and lacking digital continuity across existing systems and procedures. More worryingly, employees sometimes misleadingly inform current systems that tasks have been completed only to keep the process moving to the next stage.
Inefficient approval processes are another major cause of NVA. You may think that in our digital world industry has done away with paper-based approval systems. Unfortunately, this is not the case. Many companies still use a paper-based system that can be misplaced or sits on someone’s desk when away on holiday. Hardcopy approvals can only be a serial process, which significantly delay the approval or change management process. A PLM system allows every user to see the exact status of a product or service at a glance, and parallel approvals can be used to speed up the process. Dashboards are available for managers to see the status of all activities [affecting] product release schedules, and identify bottlenecks.
- Global locations
If your company has multiple national or global sites and key suppliers that are part of your value chain, it’s important to use a web-based PLM system with a strong security model. Web-based access [ensures] all users in the value chain have simple common access to required data without additional software being installed on their PC or tablet. The additional security is critical is securing controlled user access to data that is either Intellectual Property, Commercially Confidential, subject to Export Control, or is Militarily Restricted, etc.
- Support during and after implementation
For companies that deploy PLM software, the implementation can be more critical than the software itself. When looking for a PLM supplier, choose a company that is willing to give you and your staff the time and attention to fully convert your requirements into a functioning PLM solution. While every company aspires to an out-of-the-box (OOTB) deployment, every company has its own way of doing things—so time is required to find the right balance. Every business wants to improve year on year, but not all have the tools in place to do this.
These seem good considerations to us, but the list is far from exhaustive. What do see as critical considerations when choosing a PLM vendor? We’d love to hear your ideas.
Date posted: November 2, 2016
According to a report by Research and Markets cited in a recent issue of Design Engineering, the global product lifecycle management (PLM) market is playing a significant role in helping small and medium-sized enterprise (SME) manufacturers fuel the economy. (SME manufacturers are defined as those having revenues of $500 million or less.) With that SME boost, PLM provider revenues—for both on-premises and cloud-based solutions—are expected to grow from $48.26 billion in 2014 to $75.87 billion by 2022, a compound annual growth rate of 8.1 percent.
The report shows that cloud-based PLM offers SME manufacturers more options to configure solutions to their specific business and engineering requirements. The rapidly growing need for product development based on systems engineering, emergence of product complexity, continued growth of manufacturing in emerging economies, and expanding adoption of a more holistic end-to-end PLM solutions all contribute to the documented growth in the PLM market.
While innovation is vital to any product development process, it’s particularly important for SMEs as they look to compete against larger, more established organizations. SME manufacturers, even those with the smallest scale facilities, are using technology to bring new, competitive products to market faster than ever before. PLM is a driving force in this transformation.
“Smaller companies are increasingly using PLM,” says Joe Barkai, former product lifecycle strategies manufacturing insights VP for IDC, “not only because they are required to do so by their customers, but also because PLM systems are becoming more flexible, accessible, and easier to implement and use.”