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Our work at Talent Analytics, Corp., focuses on using predictive analytics to decrease employee turnover or increase employee performance. We work with our customers to define the problem to solve, and then together identify useful data inputs to include in predictive model development.
How Valuable is Employee Engagement Data in Predictive Work?
We are often asked if many years worth of employee engagement data would be meaningful in our analysis. I understand as there can often be years worth of employee engagement data, and the data is typically in HR’s control.
Businesses and their HR teams have long measured employee engagement “believing” employee engagement is a leading indicator for business performance. Hundreds of millions are spent, annually; conducting engagement surveys, and creating follow on programs that target areas that measure low in employee engagement.
It has to be satisfying to see reports that highlight areas in the organization with and without engagement. Engagement reports often provide a false sense of control that engagement, training and other employee development programs will lead to an increase in actual, real business performance.
It seems that executives and their HR teams, at the highest levels, have bought into the myth that high engagement leads to high performance. I say myth, because of the limited number of companies (and the consultants that work with them), that have done their own research proving this connection.
Employee engagement data definitely has value. But it needs to be used for the right thing. Use this data consciously – perhaps in HR programs. We’re suggesting employee engagement data is best kept out of the predictive domain.
What follows are 6 reasons we believe employee engagement data is best kept out of the predictive domain.
In most companies, this means we need to leave HR, go across the building, and talk with an LOB manager to get the KPIs. Business KPIs are where the rubber meets the road and where your predictive project will finally gain supporters and more resources.
If we don’t go all the way to predicting the KPIs, we are proving nothing and not adding predictive value.
Employee Engagement Measures can be Useful – but Using Them as Inputs to Predict KPI Performance is Tricky
I’m not negative on employee engagement scores for any reason except that businesses and their HR teams have been led to believe high engagement equal business success. And they often don’t know or haven’t proven it. I actually applaud organizations in years past for trying to find and measure metrics that could lead to a prediction of future business performance.
Employee engagement was a good try but ultimately doesn’t reliably and repeatedly show a strong connection. Current predictive analytics methods and approaches and better systems and data make it possible to move beyond this “middle measure substitute” to predicting real business performance.
Employee engagement surveys can be useful when used the correct context – and “right sized” in terms of their importance to the organization. If they are used to gain a general measure of sentiment then they have value.
Predicting KPI performance is another issue, where there are more direct measures with a lot less bias and are more efficient in their predictive capabilities.