Speaker 1: I mean, if we look at HR, there seems to be a bit of a fundamental problem. As you said, things are becoming more dynamic, so organisation design is increasing in importance, frequency and probably complexity as well. But the vast majority of HR functions don't necessarily have the tools and capabilities required to succeed. And when we were talking about this last week, you drew a really nice link between finance and HR, and the need to distinguish between operations and planning. I think that'd be a really great story or process to outline to our listeners.

Speaker 2: Great. No, thank you. So let's start with finance. And finance is broadly broken into two sub-functions. There is financial control. So that's doing all your financial accounting, bookkeeping, credit control, treasury. And without that, you literally run out of business. You don't have cash, you can't do your regulatory accounting, you're kind of finished. But it's not the financial controller that is sitting next to the CEO and the executive team, the management team, helping them. It's the other finance function, FP&A, financial planning and analysis. They do the budgeting, they do the planning, they pull the levers and do the analysis so you can execute the strategy from a financial perspective. And FP&A is there in that ongoing planning, forward-looking, driving the business forward. Now, what's interesting according to Deloitte, 75% of the finance function is financial control, 25% is FP&A. So it's a huge investment in the finance function and financial planning and analysis. And data from our own clients bear that to be true as well. We see a similar thing. Now, in HR, we have HR operations, the employee lifecycle management. So think talent acquisition, join and move a lever, L&D, dispute resolution, which is a favorite of many people in HR. And without that, you don't have a business. It is fundamental and it's crucial that that operates effectively. But what you also have is organizational planning and analysis, OP&A. And OP&A is the workforce planning, which is tied to organizational design. And organizational design becomes workforce planning. Because all your positions that you design is your 2B, or your 2B isn't a point in time, it's every month you have new positions that are coming and going. And so that dynamic process becomes workforce planning. It's also the analysis, which is one of your big passions, but it's the forward-looking analytics. And the mistake that people often make when they talk about analytics is they think about historical analysis. And even they talk like the Nirvana of analytics is being predictive. Well, I disagree with that respectfully because it's not just about predicting the future like employee churn, who might leave or who might not. It's about planning the future against that strategy. And OP&A is a function like FP&A. Now, the data, when I look at my clients, when we arrive, most HR functions at between 98% to 100% operational HR. And it's at most 1% to 2% OP&A. And so think about that disconnect of investment and resources. 89% of organizations we survey are doing HR analytics. But the vast majority and the vast majority of CEOs make no decisions based on HR data. I think it's max 15%, something like that. And why is that? It's because they're looking at that HR for HR backward-looking, even predictive churn, but not that planning, which is the OP&A. And not necessarily converting

Speaker 1: some of the sometimes great insights from the kind of looking backwards into something that actually resonates with the business. What's the action? Yeah. What's the action to take?

Speaker 2: How does this impact our revenue, our costs? Yeah. That is strategy. But it's also management is about plan, do, review. I plan something, I do something. Where was I successful? Where was I not? Yeah. And there's a cadence to management. And the issue is finance gets that cadence. There are monthly management reports, quarterly ones, annual ones, annual budgeting cycles, some organizations moving to continuous budgeting. Yeah. Right. That relies on continuous HR should be the same, plan, do, review. And what I call it, because I love, you have to forgive me, but I love to create TLAs, three-letter acronyms, it's sort of a hobby. So one of them is TAF. What is your target? Yeah. What is your actual? Yeah. What is your forecast? If you don't have a target, how do you know if you're on track or not? You don't. So you don't. So let's start with the target. Where do we want to get to? Strategy is about target setting, but those have to cascade. If you don't know where you are versus those targets, again, you're lost. Right. Where are we good? Where are we not? Why? And then your forecast is where do we think we're going to get to? And that's what planning is. It's planning the future. And that's what management is. And the seat at the table is doing that with organizational data. And that is what I think is the future of HR. Well, not just the future, because obviously you need to do the operations. You need to have excellence in that. And a lot of the OP&A feeds that and feeds the HR business partner. Because what is the role of the HR business partner if it isn't to help their people they're doing, you know, have the relationship with, to do that planning. To do the planning, yeah. And the planning for me isn't just around how many heads do we need? So the position management, the workforce plan. It's understanding the roles. And so most people have written a job description at some point in their life. So it shouldn't be too much of a surprise to say, what data do we have on a job description? Well, we have what's the purpose of the role? But we also have what are the objectives? What do you try? What does the role need to achieve? What is the work and the accountabilities? And what are the competencies to be excellent at that? And so you also need to understand that from a job family perspective. So what are the technical competencies? But also when you think about the grades. Yeah. So the seniority and what are the competencies? And that creates a job grid. And so what I'm really talking about is master data management, a lot of this. And the foundation of good analytics is good data and therefore good master data management. And each of these components are components of that data that

Speaker 1: are connected. In this series, we will be speaking to a range of senior leaders who are pushing a data-driven and digital HR agenda. Make sure that you subscribe by your podcast app of choice, and also via our YouTube channel for free and regular interviews with the digital HR leaders of the future.