The Challenge of Proving ROI in HR

A few weeks ago, my friend William Tincup contacted me to ask if I would be a part of a series on the DriveThruHR show called "Convenient Conversations."  Essentially, they are inviting HR pros to come on for a 30 minute discussion about a topic that is on our mind relative to the work of trench HR.  Thirty minutes to talk about what's on my mind?  Where do I sign up?  It wasn't hard to convince me to sign up.  I am thankful for the invite and my session is scheduled for tomorrow at 12 noon.  

What I'm planning to bring to the table for discussion is the challenge we face with proving the ROI for HR initiatives and projects.  Any one who's spent any time in HR or selling into HR understands how challenging it can be to prove the ROI for people initiatives to gain the support of the CEO and other executives.  I think that there may be an argument to be made that HR is held to a different standard in this regard than other functional areas within organizations, but that discussion is going to have to wait for another day.  There's a lot of reasons that proving ROI in HR is challenging.  Here are a few of the big ones.

1.  Isolating and measuring the impact of a single variable in human systems is really hard.  People are really complex animals and we almost never change one thing at a time.  When we go on a diet, we may eat differently, exercise more, think about different things, etc.  If we lose weight, it's hard to know what had the biggest effect.  It could be that your ate was what did the trick, but you really can't say because you changed multiple variables.  In the work environment, it is equally as challenging if not more so to isolate what really makes the difference in human behavior change.

2.  ROI is an art, not a science.  For any given initiative, there might be a dozen different ways you could prove a return on the investment.  Consider an engagement survey.  Employee engagement can be linked to customer service, absenteeism, productivity, retention, innovation, etc.  The trick is choosing the outcome that matters to the people who have to say yes within your organization.  I have built eloquent, even brilliant, ROI analyses in my career that have failed miserably to secure buy in because the CEO who needed to say yes to the project didn't care about the particular outcomes I chose as most important.  When I worked in the call center world, every ROI ultimately came back to employee retention and productivity.  In other places, the same project instead was supported by the "happy employees=happy customers" analysis.  It all depends on your audience.  It doesn't matter what you think is most important, it's what they think is most important that will get you the buy in.  

3.  If your executives have mentally dismissed HR or they don't care about people, the best ROI in the world isn't going to fix that.  I can build you a dozen different ROI's for investing in improving employee engagement.  But, if you don't grasp the idea that treating people better will make them want to work harder for you, it's probably not going to happen regardless of ROI.  On the other hand, if your executives already embrace employee engagement, don't talk them out of it by beating them over the head with numbers.  Give them as much as they need, and then focus on delivering some killer, measurable results. 

These are a just a few thoughts on the subject.  If you agree or disagree, I'd love to hear from you and learn from your experiences.  I'm looking forward to chatting more about it tomorrow with you and the guys from DriveThruHR.  

New Year, New Look

I've given my blog a face lift.  Nothing major, just needed to make some tweaks so that it felt more like me. I've also dropped "Practicing HR" from the title.  That title seemed like a great idea when I originally created the blog, but it never quite fit.  Why the changes?  That bears a little explanation.  

One thing that has always been amazing to me is how easy it is to help others through your expertise, but how challenging it can be to use the same expertise on yourself.  As a sales recruiter, I was continually shocked by how inept successful, professional sales people were at selling themselves when it came time to look for another job.  Give them a product to sell, they can go make it happen.  But when it came time to sell themselves, they lost their mojo.

In the same way, I advise others on personal branding and communicating their value clearly, but haven't been doing a great job applying that same advice to my own personal brand.  This isn't to say that my brand was a complete mess, but it clearly needed some work. 

If you are reading this post, you probably know that I have a multi-faceted career.  I am an HR executive leader for a Midwestern bank where I do the good work of corporate human resources with my team on a daily basis.  I'm also a blogger (but you clearly already knew that).  I am a professional speaker and writer with my partner in crime Joe Gerstandt over at TalentAnarchy.com.  And, I am an advocate and crusader for the transformation of human resources as a profession (note HRReinvention.com as an example of this work).  All of these pursuits share something in common: me and my passion for understanding and unleashing talent to transform people and organizations.  I do a lot of stuff, but it's still the same guy pursuing the same purpose.  

So, what caused me to realize that I needed to do some work on my brand?  First, I met and became friends with Jason Seiden.  For those of you who don't know him, he does a lot of great work helping people live better stories.  He is a coach and an entrepreneur.  He does a lot of stuff including having written a couple of great books (which I have read and encourage you do the same).  Jason is awesome and he has a knack for asking the questions that matter.  At one point this year, I was sitting with Jason in a hotel bar in Chicago having a drink and he asked me a simple question, "What do you stand for?"  I game him an answer.  He looked me in the eye and asked, "Do you actually believe that is b*llsh*t?"  He was absolutely right.  I didn't really know the answer.  How could it be that I wasn't clear on what I stood for?  So, I started working on getting clear.

Later in the year, I was introduced to Carol Ross.  In our introductory phone conversation, Carol and I got to talking about social media and LinkedIn.  We also somehow ended up talking about the power of storytelling.    Ultimately, Carol told me about a process that she and a colleague had developed to help people create a compelling LinkedIn profile.  I was interested to hear about the process, but didn't think I personally needed it.  But when I gave it a deeper look, I decided I needed to give it a shot.  It ended up being about an 8-10 hour investment of time over several weeks, but by the end of the process, I felt like I could finally tell a story both in my new LinkedIn profile, but also just in general about what I stand for and what I am here to do.  (If you are so inclined, I'd love your feedback on my new profile.  If you like the end product, I encourage you to buy the kit from Carol's website here--it's worth every penny.).

Carol's process wasn't just about my LinkedIn profile, it was really a way to define my brand in a way that I couldn't before.  Once completed, it led me to make changes to my blog and elsewhere in my social media footprint.  

So, what did I learn through this process?  

• Personal brand is about knowing and telling your story.  Sounds easy, it's not.  But, it's worth the time to get it right.
• Even if you think you can write your own story, get some help.  It's really hard to be both clear and concise when telling your own story.  Use tools and others to help you refine it.  
• Naming my blog anything other than with my own name was a mistake.  People reference my posts by my name, so why not use that as a title?  
• Getting your story clear is really rewarding and empowering.  
• It's great to know really smart people like Jason Seiden and Carol Ross who will challenge you to get better, to be better and to do better.  (Thank you to you both.).

Probably a lot more explanation than you wanted or needed.  My hope is that something in my journey might be helpful to you as well.

Happy New Year!