The pragmatic and visionary talk with Yannik from Kienbaum and Anna from Tandemploy
The ethical use of employee data has the potential to make all our (work) lives better – a statement that both the Tandemploy as well as the Kienbaum team would confirm immediately. All the more reason to stick our heads together and continue to push forward the smart use of data in HR. The role models: Trailblazing projects in the area of open data and smart city, such as those being implemented in Finland. These show the innovative power that data can unleash when used boldly, in compliance with the GDPR, and with good intentions. Namely, in a way that people understand that the use of their data benefits them directly and not some invisible “Big Brother”.
Open Data and HR – for most people this combination probably raises a million red flags. After all, we are talking about personal data being handled by corporations. They can’t just make that available to all employees and HR management. Or can they, Anna?
Anna (laughing): That’s not actually necessary. The employees share their data themselves: of their own free will and only as much as they feel will benefit them. That is the idea behind the smart talent marketplaces that we are developing at Tandemploy. To a large extent, we are putting HR in the hands of those it affects: the employees themselves. And they usually have fewer reservations in terms of data privacy than the HR department, right, Yannik?
Yannik: Absolutely. The centralized collection and use of data in HR are broadly perceived as fundamentally contrary to employee interests. However, we have noticed that for the ethical and responsible use of people analytics the opposite is true. If valid information in the form of data is used for HR decisions, transparency and objectivity increase, which of course primarily benefits the employees.
Perhaps we have to distinguish more clearly: unfortunately, it is still often the case that when people analytics or data-driven HR are mentioned, many people automatically think of intransparent algorithms that make automated decisions about employees. Fortunately, this is not possible under the GDPR!
We would like to make the case for a new employee-centric, transparent, self-determined, and responsible approach to HR data, because data can greatly improve HR work by offering an additional basis for decision-making in the interest of the employees. We just have to use it for the right purpose, in a way that benefits the people who provide their data – voluntarily, informed, and without the risk of suffering disadvantages should they decide not to share certain information with their employer. If this attitude is adopted by HR, it should be much bolder about systematically collecting and evaluating employee data.
Anna: The right attitude is an important point. It determines what the collected data can actually achieve and affect. So in the beginning, companies need to evaluate their company culture: What do we want to change? Why do we want to change it? And how can data support this process? Companies that are serious about digital transformation, that want to get to the core of the matter and are ready to scrutinize and break apart encrusted structures in order to offer employees a better work environment, do not need to shy away from the use of data. In an intensive process of exchange and discussion with the HR-Tech Ethics Advisory Board, we have developed pragmatic guidelines for the responsible use of data and algorithms, which organizations can use as a guide.
Yannik: In my opinion, the use of people analytics is also an essential step towards democratizing and increasing the agility of organizations. For example, when companies begin to anonymously collect and statistically analyze feedback from inside the organization regularly, then every voice, every opinion, and every bit of feedback in the organization counts equally – not just that of those who yell the loudest. But we can also notice how decisions in personnel development or recruiting gain transparency, objectivity, and, consequently, quality when data is used as a basis.
Your Tandemploy skill map is similar: it’s a great example of how the use of smart data can enable companies to look deep into their organization and see the potential that lies within. These are insights they can’t get without data collection. With this knowledge, they can always react to the needs and interests of their employees or, better yet, stay one step ahead of them so that employees can develop any time as needed. This is the foundation of a good employee experience, and data is the way to build it.
Anna: There are great examples from other areas of how data can be used sensibly and ethically, for example in urban planning. The city of Helsinki’s open data project is one such flagship project: Here, the city administration makes everything that could be relevant for residents and for improving their quality of life public, whether it be building projects or decisions, expenditures, maps, or traffic data. The goal is clear: to make the city more innovative and livable. Residents experience firsthand that their movement data, for example, helps to achieve this, because new services and apps are constantly being made available to make their everyday lives easier and more enjoyable. That’s exactly what it’s all about in the work context, too. When people realize that their data is being used to improve their work lives and promote their professional development, they provide it willingly. However, for employees in companies to realize this, the effect has to be noticeable. Companies are receiving a vote of confidence here that they should not squander. This means that new competencies must be built up at the management level. This fundamentally changes the role of HR management. Do you share this view?
Yannik: Yes, and I observe very critically that HR is still underestimated. By using people analytics, HR has the opportunity to make its own value contribution measurable, to speak the (numerical) language of the business, and thus to take on a stronger formative role. The scenario that HR professionals will soon be replaced by an algorithm is often discussed, perhaps even enough for a catchy headline – but it is often forgotten that it takes deep functional HR expertise to work in a data-driven way. On the one hand, HR questions must be translated into solvable data problems, and on the other hand, quantitative information must always be considered in its qualitative context – this is where HR experts are needed.
The real automation process takes place elsewhere – in HR administration, reporting, and service centers. HR can use these freed-up capacities for strategic, consultative, and empowering HR work and deliver entrepreneurial value for all business areas. This way, HR tasks can and will transition from administrative work to strategic design – because decisions about people should always be made by people, not algorithms. At the same time, HR managers need the space to define their own role in the changing fabric of the organization. They need opportunities to engage with employees, to listen, set up new working models and communication channels, and to maintain a connection with the people in the company. After all, they are taking on a role at the intersection of people and technology that requires them to learn continuously. That is not something that can be done on the fly while simultaneously dealing with recruiting. It is a whole new area of responsibility that is crucial for the success of the company and for which the HR department must be well prepared.
Anna: I also consider an HR update within organizations absolutely essential. Because ultimately, it’s not an algorithm that determines a good employee experience and working environment, but how we as people interact with one another. It also largely depends on the personalities that take on leadership roles in HR. The use of smart, data-driven HR technology is an opportunity to completely reorganize and redefine the way we work with each other. This is not “nice to have”, but absolutely necessary, not only to empower companies themselves but to trigger overall societal change. Many changes on the “outside” start with changes in our work environment. They are an important lever for a better work-life balance, for people’s mental and physical health, for a more conscious use of resources. Conversely, all of this benefits companies and their products. Win-win-win, I would say.
Yannik: I couldn’t agree more. If we manage to use data in a way that shows us new ways and perspectives to master the challenges you mentioned, there are hardly any arguments against using it. People analytics should therefore not take place behind closed doors. What we need above all is the courage to innovate and open discourse with everyone involved, especially the employees.