What does this mean for leaders? What can we learn from it?

A 2017 Deloitte study found that although companies believe in the power of people analytics, only “9% of respondents have a good understanding of which talent dimensions drive performance in their organizations”. This means that 91% of respondents are unsure about which talent dimension boost performance in their organizations.

What is the reason behind this incredible finding? Taking a page from ancient Greek philosophy can shed some light.

In his book “Politica” (IV century B.C), Aristotle defines the human being as a social animal to outline our propensity to develop social communities. The Aristotelian definition of human being sheds lights on the importance of understanding ourselves not as a single and autonomous entity, but as a function of our relationships with others. Forging interpersonal relationships is a central part of human nature.

So what does this mean for leaders? What can we learn from it?

Aristotle’s perspective suggests that the field of people analytics should evaluate not only individual traits (commonly measured in people analytics) but also social networks (aka relational analytics) to better predict employee and team effectiveness. Surprisingly, the vast majority of companies do not integrate people analytics with relational analytics.

Now, could the lack of a union between people and relational analytics explain why 91% of companies are unsure about which talent dimension drive performance?

Communication and relational patterns: the missing pieces of the puzzle

An HBR article written by Paul Leonardi and Noshir Contractor had an insightful suggestion — in order to reach a deeper understanding about what actually drives employee performance, companies should redesign their talent management strategies and analytics to embrace a more holistic approach. The authors make the claim that current people analytics measures are superficial, “myopic”, and thus, inefficient. They recommend managers to implement “better people analytics” (the title of their article), considering that employees’ behavior and performance at work are greatly influenced by their relational attributes, not just individual attributes. Rigid assumptions should be replaced by more adaptive ones that consider external and sometimes uncontrollable variables, such as how interpersonal communication impacts team and employee performance and engagement.

As an HR Analyst at Cally, I learned this first-hand. For instance, through the integration of Cally’s pulse surveys and relational analytics, we found out that performance issues of an early-stage startup team didn’t stem from interpersonal conflict or unclear goals, but from dysfunctional information sharing. It was not some personally attributable characteristic about the employees that resulted in lower performance, it was information dis-symmetry reducing awareness that was holding back overall performance of the team. As seen in Cally’s network graph below where names have been changed, the information Anthony receives is funneled through Rachel, the team lead. Just seeing this graph gave the team awareness of the bottlenecks and cliques that had formed. To reduce information dys-symmetry, Cally also suggested more interdependent tasks between Anthony and the other team members. Looking at Figure 2, which represents the next months communication network, Anthony is more connected and information is more evenly distributed.

Fig. 1 Month 1 — information unevenly distributed, Anthony only silo

Fig. 2 Month 2 — Team is more connected, information flows more evenly between nodes

As we can see, the lack of a union between people and relational analytics can explain why 91% of companies are unsure about which talent dimension drives performance. Taking an open system approach, that combines people and relational analytics, can help companies close the gap and better understand the critical factors that influence team and employee outcomes.

The benefits of an open system perspective

Today, competitive advantage is not driven by organizational practices that maximize productivity and efficiency, but rather by those that enable speed, flexibility, and a team-centric approach. By marrying relational and people analytics, companies can nurture higher-performing teams, spot the change agents, and identify where to focus resources for improvement in real-time. This open system approach enables companies to be more adaptive and competitive in their markets.

Let’s think about the automotive industry. Auto-manufacturers, such as General Motors (GM), are not the only protagonists of the automotive supply chain. Other important entities are crucial to build high-quality products. Supplier networks that provide auto-manufacturers with raw materials and components. Then, marketing channels, such as the dealer networks, are equally important to drive sales and customer love. In this situation, how can GM better cultivate relationships with key suppliers to improve economic returns? One answer could be to identify the person/team that acts as a bridge between the company and supplier and help them succeed.

To conclude, relational analytics can help identify who in the organization may be overwhelmed by communication, left out from key conversations, and any bottlenecks to information sharing.

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