Framework Framework LAMP Framework • The letters in LAMP stand for • logic • analytics • measures • Process four critical components of a measurement system that drives strategic change and organizational effectiveness. LAMP : Logic • The logic element of any measurement system provides the “story” behind the connections between the numbers and the effects and outcomes. For example • “Employee Health, Wellness, and Welfare .” : connections between health/wellness and employee turnover, performance, and absenteeism • “The Economic Value of Job Performance” : uses the logic that improving performance of every product component is not equally valuable • “service-value-profit” : the connections between HR and management practices, which affect employee attitudes, engagement, and turnover, which then affect the experiences of customers, which affect customer- buying behaviour, which affects sales, which affect profits. Example : Sears, which showed quantitative relationships among these factors and used them to change the behaviour of store managers LAMP : Measure • quality of HR measures : timeliness, completeness, reliability, and consistency • Example : measure employee turnover, performance, engagement, learning, and absence • well-known principle is the “80-20 rule,” which suggests that 80 percent of the important variation in inventory costs or quality is often driven by 20 percent of the inventory items. • If absence has the most effect in call centers with tight schedules, this should be very clear in how we measure absenteeism. LAMP : Analytics Suppose an organization has data showing that customer attitudes and purchases are higher in locations with better employee attitudes. This is called a positive correlation between attitudes and purchases. customer attitudes and purchases actually cause employee attitudes. This can happen because stores with more loyal and committed customers are more pleasant places to work. The correlation can also result from a third, unmeasured factor. Perhaps stores in certain locations (such as near a major private university) attract college-student customers who buy more merchandise or services and are more enthusiastic and also happen to have access to college-age students that bring a positive attitude to their work. Store location turns out to cause both store performance and employee satisfaction. The point is that a high correlation between employee attitudes and customer purchases could be due to any or all of these effects. Analytics is about drawing the right conclusions from data. It includes statistics and research design, and it then goes beyond them to include skill in identifying and articulating key issues, gathering and using appropriate data within and outside the HR function, setting the appropriate balance between statistical rigor and practical relevance, and building analytical competencies throughout the organization. LAMP : Process (Key terms - explain) • Knowledge • Change process HCM : 21 - human capital management for the twenty-first century • HCM:21 is a four-phase process that starts with scanning the marketplace and ends with an integrated measurement system. In the middle, it addresses workforce and succession planning in a new way and shows how to optimize and synchronize the delivery of HR services. • HCM:21 is a model and a methodology for managing human capital, talent, or simply people. • HCM:21 is the broad strategy that provides the framework for analyzing an organization’s data. It takes brainstorming lists, interview and survey data, and market research and organizes these elements around human, structural, and relational capital phenomena. By applying HRA tools, predictive management uncovers the connections and interdependencies among organizational activities. Study of the outcomes at the strategic, operational, and leading-indicator levels yields insights into the future. It tells not only what, how, and why something happened yesterday, but, most importantly, also what is the likelihood of something happening tomorrow. • Predictive management, or the essence of HCM:21, executes a strategic scan of the external forces and internal factors that can affect the three fundamentals of an organization: human, structural, and relational capital. Human capital is your employees. Structural capital is the things you own, ranging from patents and copyrights, to software programs and codified processes, to physical facilities and equipment. Relational capital is the knowledge and contacts you have with external stakeholders, which • 1. Scanning. What is going on outside and inside that might affect future operations?All the external market forces and internal organizational factors are listed in terms of how they might affect the organization’s human, structural, and relational capital. Additionally, the interdependencies and interactions across these three forms of capital are recognized and accounted for.
• 2. Planning. Workforce planning is reconstituted as capability
development. The industrial-era, gap-analysis, structure-focused model is replaced with an agile system focused on building sustainable human capability rather than filling positions; in fact, many of those older positions will be restructured or eliminated.
• 3. Producing. Human resources services are studied as
processes with inputs, throughputs, and outputs. Statistical analysis is applied to uncover the most cost-effective combination of inputs and throughputs to drive desired outputs.
• 4. Predicting. A three-point measurement system is designed to
include strategic, operational, and leading indicators. The causal and correlation aspects of the three points are used to tell a comprehensive story. s the four phases of HCM:21 and the arrows indicate how predictive analytics link the phases Talentship framework Efficiency • The efficiency anchor point focuses on what resources are used to deliver HR practices. Typical indicators of efficiency would be cost-per-hire and time to fill vacancies. As noted earlier, when applied to sustainability, efficiency would focus on the resources used to bring HR practices into compliance or to provide incentives that reflect community, environmental, or social goals. • Effectiveness • The effectiveness anchor point focuses on how HR policies and practices affect the talent pools and organization structures to which they are directed. Effectiveness refers to the outcomes of HR policies and practices on human capacity (a combination of capability, opportunity, and motivation) and the resulting “aligned actions” of the target talent pools. Effectiveness applied to the traditional financial definition of success might include measuring whether sales increase for individuals who receive training or incentives. Effectiveness applied to the sustainability definition of success would focus on how HR practices affect human capacity and aligned actions that go beyond traditional job and performance requirements. Capability might include knowledge about the organization’s social responsibility and ethics codes. Opportunity might include time off from work to do volunteer tasks in the local community. Motivation might include employee perceptions that activities related to sustainability are noticed and rewarded. • Impact • Impact reflects the hardest question of the three and most vividly illustrates the fundamental differences revealed by a focus on talent decisions, beyond simply HR service delivery. Impact asks, “How do differences in the quality or availability of different talent pools affect strategic success?” This question is a component of talent segmentation—just as in marketing, where a component of market segmentation asks, “How do differences in the buying behaviors of different customer groups affect strategic success?”