Insight into the future is the greatest asset anyone can have. Consider how wealthy you would be if you had the ability to foresee future trends or events. If you foretold an event was it because you were lucky or wise? Luck comes in two forms: dumb luck and true luck. Dumb luck is when you meant to bet on the number 6 horse but made a mistake and bet on the number 5, which won while 6 finished out of the money. True luck seems to be a function of preparation. There is a story from the golfing world that makes the point.
One day Gary Player, one of only four professional golfers who have won all four major tournaments: US and British Opens, PGA and the Masters, was practicing sand shots. A man watched as Player knocked most of the shots from the bunker into the cup. He said to Player, “Son that is the luckiest thing I’ve ever seen.” Player responded, “Sir, I find the more I practice the luckier I get.”
Most organizations do not rely on dumb luck to save them from market fluctuations. They prepare by buying commodity futures to protect themselves from shortages or cost increases. They buy advertising space a year at a time to obtain volume discounts. What do they do in the human capital arena to offset future surprises? In most cases the answer is nothing. If you were to ask what will be the most cost-effective staffing strategy and applicant sources in the coming year or what is the most effective training method for the new product line sales people what would be the answer? Typically, there would be no data on which to base a reply. Only isolated anecdote or obsolescent cases would be offered. The chief administrative officer of a major bank once told me that he spends over $250 million annually on training and has no idea if it is effective. His human resources function applies a helter skelter approach to service delivery. It does not have a management model or operating system with predictive capability until now.
In today’s marketplace insight is essential. This is where and why predictive analytics is so important. If you don’t agree let me ask you this. What is your basis for making decisions about future investments in HR processes? Can you show me data that predicts with a high degree of certainty what the outcome will be if you invest in one vendor, service, process or tool versus another? Would you be comfortable going before your board of directors and recommending one versus the others? What would you have to offer if they asked you for evidence in support of your choice? What objective data could you show?