In a Consultant Corner post last month (see HR: Importance vs. Influence), my top-flight colleague, Suzanne Rumsey leveraged a recent survey from McKinsey & Co to demonstrate HR’s perceived lack of alignment with the businesses they support.  She highlights that line managers who participated in the study, much more than HR participants, agree that:

1.       HR lacks capability to develop talent strategies aligned with business objectives

2.       That HR is not held accountable for success or failure of talent management initiatives, and

3.       That talent management is viewed solely as HR's responsibility.

When I hear about alignment and ownership from HR clients of ours, I propose they use service level agreements (SLAs) to address them.  SLAs serve as anchors to the performance consulting models HR and T&D groups must employ to better support the needs of the business.  The purpose of these agreements is to require HR to work with its business customers to define their desired business and workforce outcomes and then what programs and services will be delivered to achieve them. 

To write an effective SLA and ensure it’s used to perpetuate alignment, I recommend combining it with your intelligence strategy.  Specifically, I recommend using SLAs to facilitate the 3 types of measurement needed not only to establish alignment and accountability, but to drive ongoing adjustments and improvements to the programs and services in-scope.

Use measurement to drive focus and accountability.  The SLA has an integral role to play in 3 types of measurement.  The first is predictive measurement, which is meant to drive alignment between HR / T&D investments and the needs of the business expressed, where possible, to KPIs important to line managers.  The KPIs documented on the SLA should establish the causal chain between the services being provided and workforce performance as well as establish service quality and accountability goals for both HR and line managers to meet.  In the case of talent management, these KPIs are typically tied to effectiveness in the form of workforce productivity, competencies, bench strength, retention, mobility, etc.  They may also include measures of HR service quality (e.g., our staffing group produces high-quality candidates) and efficiency (e.g., time-to-fill).

The second type is in-process measurement. Its purpose is to validate that a program or service is believed to be achieving its desired business results as measured through the KPIs identified on the SLA. In-process measurement may combine a mix of transactional data collected through HR systems (e.g., time-to-fill, participation in new product training) and survey instruments to assess whether or not HR services and programs are making the desired impact on the target audience, and in turn, the organization.  HR should use in-process measurement to make periodic/continual improvements to their services and programs.

The third and final type of measurement that leverages an SLA is retrospective measurement, which is meant to assess desired business impact.  This may or may not include calculation of ROI.  The assumption here is that enough time has passed and/or enough employees have been touched by the program or resource.  Retrospective measurement builds on data captured through predictive and in-process measurement by integrating data captured through other systems (e.g., point-of-sales, IT help ticket system, CRM) to demonstrate causality and ROI.  With sufficient data and analysis, the outcomes of retrospective measurement can be used to feed predictive measurement through scenario planning and analytics. 

My advice to those considering performance consulting models that leverage SLAs - start small and keep the language simple.  I also recommend engaging the right stakeholders.

My request to those who read this post - please share your thoughts…