How many organisations can answer what should be a simple question? Most organisations should be able to do this with relative ease. Surely if an organisation pays people on time and accurately then they must know how many people it employs.
However, the reality is quite different. Having worked on several large global transformation programmes a common question I hear as a business requirement is to be able to easily answer the key question – how many people do we employ? This can be broken down further with other key criteria such as; grade, country, length of service, diversity data. Understanding how many people are employed is the backbone for many other processes such as workforce plans, employee turnover analytics and rebalancing, authorisations matrix, cost management and forecasting for example. Without being able to understand how many and who is employed today, it is very hard to understand the types of capabilities and skills the organisation requires tomorrow and identifying the gap to fill. Employee data is crucial and important and is the organisation’s most valued asset and enables business processes can run efficiently and effectively.
So, why do organisations struggle so much with this question?
Partly because the definition of an employee to be included as headcount is difficult to decide due to the consequences of getting this right. For example there are 3 questions below, on how to treat different types of individuals
- Do you include your temporary workforce?
- What about contractors, should these be included?
- Or those on long term absence, i.e., maternity leave, sickness absence?
Tools and technologies don’t talk to each other. Today’s organisations often grow through mergers and acquisitions. This results in systems and technologies that aren’t integrated to share or manage information. Often even when information is integrated this isn’t always applied or defined consistently. For example in global organisations where the span of control is much wider.
The owner of employee data and responsibility to ensure data integrity usually has some impact of the ability to answer the question too. There are generally 3 roles that we find take some form of responsibility; the Chief Information Officer (CIO); the Finance Director (FD) and the Human Resources Director (HRD). Experience has shown that typically
- The CIO owns decisions on the technology and it’s use across the business including HR and therefore how the information on employee data is held
- The FD owns the budgets in relation to people
- The HRD owns the data and maintenance of the employee master data
This split model is often what causes challenges in getting the right data into and out of the tool. We recommend the ownership lies with the HRD and HR should take the end to end ownership for all HR data and work closely with the CIO to establish the recording and storage of this; while the FD is a client and may state business requirements from the tools and technologies.
Once ownership is agreed the key decision of who is classified as an active employee and therefore in the headcount report is the key (it is not a one size fits all here); followed by educating the business to ensure consistent usage. There must be owners and control points for the maintenance of the data and effective processes to ensure future data integrity and governance.
The advantage of having consistent data and usage of labels means that organisations are able to have one version of the truth from a local, region or global view as all the data held is telling the same story. This is critical as this information is used to drive effectiveness and efficiency in many business processes.
We have worked with a number of clients over the last couple of years, to help them resolve these issues by suggesting more effective, efficient and less time consuming means of maintaining this data; how to define headcount; how to integrate technologies; developing processes to manage the inputs of who you employ to other more dynamic processes.
So let’s take a short straw poll…do you know how many people you employ?