CFA Society Singapore
SINGAPORE (Oct 22): More data and less gut feel. That’s how talent should be hired, rewarded and retained, in the view of the founders of software-as-a-service start-up EngageRocket.
Leong Chee Tung and Dorothy Yiu, the start-up’s founders, and CEO and chief operating officer, respectively, had spent years at management consulting firm Gallup and found the human resources industry seriously lagging in using data to make decisions. They have since made it their mission to help companies’ HR units create a better work environment by using data generated by various parts of an organisation. This would include operational figures, performance reviews and employee engagement data.
“What we are hoping to do is put it all together to a single source of truth. Once that happens, it is more trackable for analysis,” Leong tells The Edge Singapore.
“[Operational data] is what is happening and [experiential data] is why it’s happening. To create forecasts and predictive analysis, you need to combine the why and the what.”
Leong explains that HR departments are increasingly asked to demonstrate returns on investment (ROI) in talent, just as marketing departments had been before, for instance. At the same time, organisations are finding it increasingly challenging to retain staff. And, as staff costs are typically about 70% to 80% of operating expenses, optimising the spending on staff can thus be seen as a huge win.
“We’ve seen sales and marketing use data decades ago, but HR is slower in using data. So, we decided that EngageRocket will be there to help companies leverage people analytics,” says Yiu.
“Companies are actually particular about the ROI of each hire. You recruit them, train them and pay for the couple of months they are not productive yet. At the end of the day, what they want is a longer relationship with each employee. And you can’t do that or manage people well with ‘I think they feel this way’,” Yiu adds. “It is about effectiveness. We are even helping companies address issues of keeping employees for more than a year.”
HR as strategic function
Leong and Yiu started on engagerocket, as the software is known, three years ago. Since then, they have sold their software-as-a-service to more than 30 organisations in 13 countries. “There is definitely an aspiration to use data more intelligently. We did a study early this year and only about 28% of HR leaders said they used data to generate insights. When we surveyed their business leaders, only 5% said they did. There’s a gap that needs to be filled,” says Leong.
Data is the most valuable when you collect it and Yiu and Leong wanted to find a way to bring real-time data to their customers to act on. Their venture also comes as HR units are being entrusted with more strategic functions, instead of being seen primarily as an administrative department. With employee insights gleaned from multiple datasets, from sentiment to work performance, EngageRocket is focused on helping companies retain and develop their talent.
“Within [retaining] employees, there are three main variables we would look at: First would be sentiment data from surveys, which we would automate and make frictionless for data collection and analysis. Then, the attrition rate and turnover data is also one big bucket of data. Last is performance data, from sales to performance reviews, rankings. These three buckets of data can yield a lot of insights into a company,” says Leong.
“We’ve helped managers improve performance by up to 15%,” Yiu adds.
The EngageRocket platform also allows clients to tweak and customise parameters such as the frequency of data collection. These surveys can be run continuously or once a month, depending on what the business wants.
“We help them pull out the experiential data that most companies do not measure properly, to help them tie it back to the business and have a better insight to what their people are feeling and help them manage their people,” Yiu explains. “For example, if I want to measure the engagement of my employees, I can [conduct] a monthly survey to stay on the pulse of what they’re feeling, [instead of] an annual review.”
Another use case is to check on change management. “An organisation we work with has undergone a big structural change and wanted to make sure the people feel fine. So what they did was run a survey before and after the change. Our software is capable enough to handle those needs and, on top of that, we have a customer success team that works with them to help them make sense of the data,” says Yiu.
“We also provide services that pull deeper analytics for clients by pulling their business data and attrition data to see how there’s a correlation,” she adds.
Ultimately, EngageRocket’s aim is to connect the various aspects of the HR function, and the information that comes from them, to help “HR senior leaders make better decisions for the business in a way that is quantifiable”, says Leong.
A different culture
Still, HR practices differ across markets. EngageRocket’s clients are in Asia-Pacific (APAC), and they have tailored features to suit situations here.
“So far, we have analysed over half a million responses from over 13 APAC markets. The findings and the way they are being used is a little bit different from how the West might approach things,” says Leong.
For example, some organisations may have a culture of openness and transparency, akin to what billionaire investor Ray Dalio proposes in his book, Principles, that everyone gives feedback to everyone, including the CEO, in every meeting. “This is something that Asians aren’t ready to do,” Leong says.
This has led EngageRocket to build features such as one that allows employees to air their grievances anonymously, and for their managers to respond. This ability to have an anonymous conversation was something companies found important.
The start-up is looking to grow regionally over the next two years, as it recently secured US$640,000 ($879,000) from venture capital firms SeedPlus and Found. With the funding, EngageRocket is looking to further expand its data analytics coverage.
“We’re looking to touch more moments of employee experience to cover things such as [orientation] and exits to performance management,” says Yiu. “In the next two to three years, we hope to [build] a business intelligence unit, to actually help leaders get into the predictive analytics space to help manage their talent better.”
Ultimately, putting talent management down to an exact science, or even to a set of data and analytics, might make the HR managers’ jobs easier. But with the multi-faceted nature of human behaviour, there may be nuances that a survey or algorithm might miss.
This story appears in The Edge Singapore (Issue 853, week of Oct 22) which is on sale now. Subscribe here