I attended the Wharton People Analytics Conference 2016 in Philadelphia on April 7th and 8th. After having taken some time to sort the flurry of ideas and thoughts encountered during a high-density conference, I present my filtered view and commentary below.

People analytics exists in a simultaneous state: entrenched in overcoming the artifacts of a regrettable past while pushing forwards into an uncertain future. The Behavioural Insights team in the UK government designed a tool to reduce discriminatory biases in recruitment, while research at Stanford quantified company culture by analyzing millions of emails. The heralding of artificial intelligence while organizations still struggle to overcome inequality is precisely what worries Daniel Kahneman, Nobel Prize Winner In Economics, about the potential for artificial intelligence in business. After all, Kahneman said, “I have not been awed by decision making in organizations.” As people analytics continues to become more robust in its ability to predict, and eventually develops AI capable of making business decisions, there must be a collective devils advocate to question the limits of these decisions, and collective action towards realizing the beneficial improvements they can bring.

Photo: Daniel Maurath

In the opening keynote interview, Byron Auguste, Managing Director and Co-Founder, Opportunity@Work, noted that collective action is difficult, but people analytics that is “for” and not “of” the people can make strides towards more rational decision-making in organizations. He focused on employee selection where “crude indicators have become barriers” for individuals trying to enter the workforce, and provided an example of administrative assistants, most of whom do not have college degrees, yet job listings now require them. A college degree plus 3-5 years of experience has become the new High School Diploma as organizations rely on buying instead of building talent.

Entry-level jobs that require experience isn’t the only paradox that exists in the job market. In her research on job hoppers, Shinjae Won, a doctoral student at University of Pennsylvania and participant in the research paper competition, found that companies are less likely to hire both serial job hoppers and individuals who have been too loyal to one job for too long. Companies want someone in between, “the most loyal of the disloyal,” as Shinjae describes it.

Both examples highlight the irrationality of common decisions in organizations, and despite dystopian worries, demonstrate a situation ripe for improvement with objective analytics. There is an opportunity to reverse false notions such as future job performance being completely dependent on an expensive degree, or even a degree at all, and to perform people analytics “for” the people not “of” the people.

Being that the conference took place in Philadelphia, I am reminded of the story of Rocky Balboa, a boxer who on paper wasn’t an all star, but after getting a chance to prove himself on the job, showed his world-class talent. The compelling common tale of the underdog seems like it can now only exist in fiction, but should it? I don’t think so.

Photo: Daniel Maurath

Teams

Teams are ignored by organizations. There is individual performance and business performance, while team performance is absent. Organizations assume a group of high performing individuals will lead to a high performing business, completely ignoring the dynamics of a team. Brian Welle (Google), presented research from Google that urges organizations to rethink their ignorance of team performance. Google's research found that team dynamics (i.e. how teams work together) is more important than team composition. The five key dynamics for a successful team in order of importance are:

Psychological safety: Can we take risks on this team without feeling insecure or embarrassed? Dependability: Can we count on each other to do high quality work on time? Structure & clarity: Are goals, roles, and execution plans on our team clear? Meaning of work: Are we working on something that is personally important for each of us? Impact of work: Do we fundamentally believe that the work we’re doing matters?

I do not doubt the validity of these findings within Google, but dynamics may still be secondary to composition in other organizations, which have a wider amount of variability than Google in the quality of their talent. Research has shown that placing a high-performer on a team leads to performance spillover, raising the performance of the entire team, and Michael Housman and Dylan Minor, who also presented a paper as part of the research competition, demonstrated that proximity to high performers in a call-center environment resulted in higher performance too. This is not to say that dynamics isn’t important or composition is more important, but that it depends on the organization, quality of the talent pool and current composition of the team.

Coleman Ruiz had a diverse perspective of teams based on his work with Navy Seals Special Ops. Here I noticed a few contrasts with the typical private sector organization. The private sector emphasis on buy over build does not exist, it can’t. Special Ops members must be built through rigorous training and on-the-job experience, a significant investment by the military. To join Special Ops, a SEAL will need around 8 years of experience before being considered, and then must take part in further rigorous training. Another contrast is that in Special Ops the hierarchy of responsibility is team, teammate, self, which is reverse for modern organizations. Employees look out for themselves first, assuming a quite tenuous connection between themselves and their employer, where a decision of future employment can be easily justified by a deceptive phrase, “its just business.” Both of these contrasts illustrate the mutual disloyalty between employee and employer in the private sector. While the extremes of military loyalty are unnecessary in organizations, engendering more loyalty through practical investment in building employees instead of always buying may be a new differentiator for organizations floundering in the race-to-the-bottom that is competition on compensation.

Methods

The three methods panelists provided a variety of analyses that ranged in their actionability and complexity, highlighting the curious divide in which the field stands between getting the basics sorted (e.g. fair hiring processes) and exploring the frontlines of the possible (e.g. predicting the complexity of job performance using natural language).

Kate Glazebrook (Behavioural Insights Team) presented the most pragmatic tool, Applied, which automatically blinds job applications to remove potential for bias, organizes job applications horizontally to allow for easier comparisons, and enables easy sharing of applications to bring in more diverse opinions because as their website states, “people look at problems differently, so pooling multiple perspectives reduces the risk that decisions only reflect one interpretation of the world.” Of all the talk about diversity, it’s refreshing to see the UK Government actually taking action and tackling the basics of reducing biases long known in recruitment.

Noah Zandan taught everyone how to speak like a visionary.Through research at his company Quantified Communications he discovered three tips to speak more visionary:

Use the present tense (like Elon Musk who uses it 4X more than average)

Speak in simple, clear language (Sheryl Sandberg is one of the clearest)

Let the audience experience your vision with prolific use of “you” and “your”

Duncan Watts (Microsoft Research) revealed an organizational spectroscope, a tool for mining millions of digital communications data points to explain an outcome such as team satisfaction or to provide individual employees insight into how they spend their time.

Communication analysis, whether in speech or email, is an exciting new frontier for people analytics, but the typical organization can find more value in simply hiring and promoting their people more fairly through use of tools that reduce bias like Applied.

Holocracy

Holocracy, the new organizational design of Zappos, is a platform not an experiment. That’s a point Tony Hsieh, CEO of Zappos, stressed throughout his interview with Adam Grant. He also compared holocracy to a city, which self-organizes, an iPhone, which is a platform that continually improves through apps and hardware advances, and a moonshot, which is the only way to reverse the default fate of organizations: death. But what is holocracy really? I’m still not clear.

The details unraveled through an interview not a formal presentation. Tony skirted around questions about data to support the effectiveness of this change, and truthfully, it may be too early to tell. As Adam Grant, quipped at the end, we may have to wait for Tony to find two weeks to write his next best seller.

It’s not too early to tell for Valve, who have used a similar system for many years now and outlined in their employee handbook. A quick Google search will garner articles and reviews by past employees, which in short, show that the vacuum of authority created by an organization without titles is quickly filled by an organization concerned with tenure or another indicator of status because, as research has shown, any organization that divides labor inevitably develops status hierarchies.

Diversity

Within the diversity panel, the focus was on perspective. According to Ashleigh Rosette (Duke) diversity has an idiosyncratic meaning based on whatever is most salient to the individual. For females it may be gender, for blacks it may be race. Thus, diversity should be thought of in terms of privileged vs. advantaged rather than set categories such as race or general. If I take this idea a step further, increasing diversity can be thought of as a method for generating a variety of ideas, of which categories are only a proxy. It’s a noble idea worth exploring, but organizations need new, novel ideas for enabling diversity, and I didn't learn of many at the conference.

However, during the panel on teams, Coleman Ruiz described the diversity of joint-intelligence teams in the military as a Star Wars bar, which I thought was was an inventive way to communicate diversity, and is easily relatable for anyone who has seen the films. The bars are interesting and exotic because of the diversity of characters, covering a wide range of colors, sizes, shapes and personalities. Contrast this to a much less diverse bar, Cheers. From your perspective, which one is more interesting?

But we should focus on our similarities not our differences. Journalist AJ Jacobs, who is also your cousin, constructed a global family tree and organizes an annual global family reunion which seeks to alter ones perspective of family and to demonstrate that ultimately all people are connected and that similarity should be celebrated, not differences.

Performance Management

Peter Capelli had strong words for Performance Management calling it “the organizational equivalent of stoning”, and questioning anyone who wants to defend the most despised business process in current existence. He advocated for new approaches illustrated with two examples from Megan Taylor (Adobe) and Jeffery Orlando (Deloitte), which diverge at the point of metrics. Adobe abandoned the performance rating, which Peter Capelli, reminded us was never very good anyways. In place of a single rating, they use a Check In framework, encouraging continuous performance management and feedback for development.

Deloitte opted for more metrics not less. They use more frequent ratings, per project or quarter, in place of a single summative number each year. And more metrics are better as I argued in a previous post on performance management. More metrics allow for a more holistic view of performance from a diverse group of raters, and allow for more variance among employees, which can increase the precision of analytical models. You can read more about Deloitte’s performance management process in HBR.

Reinventing performance management may sound great, and perhaps you want to implement a new performance management system in your organization, but as Dostoevsky wrote in Crime and Punishment, “Taking a new step, uttering a new word, is what people fear most.” It’s not easy to reverse the status quo, but if you’re waiting for the perfect moment to revamp your performance management process, it will never come. Like the decision to adopt a dog or go on vacation, you’ll never be 100% ready. Instead, both Adobe and Deloitte encouraged organizations to dive in and figure it out as you go. Adobe described their current state as being 4 years into a “marathon” and Deloitte described it as “3 years of endless experimentation.”

Limits of Analytics

The final panel on the Limit of Analytics, and this post, can be summed up as analytics are a tool, not a solution. To be a solution, they must be used and understood properly. At best, analytics produce probabilities, not certainties, but if we recognize that, like one recognizes unconscious bias, we can frame our application of analytics to be more pragmatic and to be “for” people not “of” people. Analytics must also be understood correctly. As a panelist noted, “Stories swamp analytics because they're about causality and simple to understand and share.” Even with valid findings and the best intentions, there is the immense barrier of kick starting collective action against the status quo; perhaps we could all learn how to speak more like visionaries.

Closing Interview Abby Wambach

After Abby Wambach(US Women’s soccer player) gave a quick address of some recent personal controversy the interview between her and Angela Duckworth (UPenn Psychology Professor) began. It crisscrossed many, but not all, topics of the conference. She voiced support for the lawsuit by her former teammates against U.S. Soccer the for being underpaid relative to their male peers, and made the point, that any male player at her level would never need to work again. When she evolved in her role from star individual contributor to a backseat team player, she found great success in texting all her teammates one great thing they did that day in practice or a game, a small behavior that could be used by any team member or manager. As soccer has become more and more data-driven, she found the ubiquitous data helpful, not overwhelming, in setting individual goals and focus on improving weaknesses in the off-season.

The interview provided a refreshing perspective from someone who admitted to looking up the meaning of “analytics” shortly before the conference. The use of external speakers such as Abby or AJ Jacobs, who are unfamiliar with the field, sets Wharton PAC apart from other conferences, and demonstrates the value of a diversity of ideas.

Adam Grant closed out another successful conference with some amassed wisdom from the day and an announcement that Malcolm Gladwell is keynote speaker next year.

I would like to thank LinkedIn, specifically Joseph Baribeau, Lorenzo Canlas and Will Gaker for sending me to the conference, and the conference organizers (Aakash and John among many others) for all the hard work they put into the conference and for allowing me to judge the research paper competition.