Where the magic happens: Combining Internal and External Workforce Data
When it comes to workforce data, the intersection of internal and external is where the magic really happens!
Combining the two data sets allows businesses to move from tactical decisions, to those that guide the whole business direction, effectively manage workforce risk, and even shape the future global footprint of the organisation.
In this article I’d like to share five examples of internal and external data coming together and what they can achieve.
If you’re interested in learning more about any of these examples, please reach out to me or comment below – I always have time to talk about the magic of workforce data! So, what magic can we make happen through data?
1. 🌟 You can accurately predict attrition
If you can accurately predict attrition, then you can do better talent planning and nurture a healthy talent pipeline. As an example, take internal data you have about time to hire, the number of people you have in a role, their employee engagement score and the flight-risk of those individuals. Then, source external data that includes the size of the external talent pool, competitor demand for the same talent, and typical time-in-role.
Put the two together and what do you have? A predictive attrition model - an entirely new lens on how to recruit and retain talent: You can refine job specs to meet the market, predict when employees might move on, and analyse competitor activity around the role, giving you a competitive edge. It really is magic!
2. ✨ You can set realistic diversity goals
Yes, you really can set diversity goals that managers AND the Board will buy into if you use internal and external workforce data to do so. This year we’ve heard a lot of talk about companies dialling back on DEI. Is this, in part, because they set themselves targets that were too ambitious and destined to fail?
Combining internal data that you hold about workforce diversity and workforce planning, with external data on the diversity of the available talent pool, can help you to set ambitious yet realistic targets at a role / function / location level. In this case, a more granular approach actually gives a more strategic outcome.
I’ve worked with a major energy company that uses data on the diversity of talent at a role level in the external market to guide their diversity strategy and it’s paying dividends for them in terms of hiring as well as informing where they’ll need to invest in training and development of early-career talent. When managers are told there is diverse talent in the external market that can do the job, or indeed that there is not, they buy in to making a difference.
3. ⭐ You can optimise your workforce for cost and risk
As an example, a company I’ve been working with is choosing to move some roles to a lower-cost country. So, each time an employee in a high-cost country leaves, the recruitment team looks for a replacement in a lower-cost market where the same talent is available. This helps them to lower costs without compromising on the skill and experience level of the workforce. Is it magic? No, it’s internal and external data!
Take internal data about the skills and roles you have internally. Compare this with external market availability and analyse the cost and risk of doing business in those markets by looking at the available talent and the talent landscape for competitor activity. The output is a plan to move some roles to be optimised for both cost and risk which can shape potential location expansion or consolidation.
For one of our clients, this exercise has shaped how the business sees their global footprint developing over the next 10 years. Imagine feeding back to the business the cost saving or risk mitigation that could be achieved.
4. 💫 You can ensure skills within your roles are current
As my colleagues at Lightcast highlighted in their research on skills change; “Even if a job isn’t created or lost, it can still change”, and that change is happening quickly. Another new piece of research from Lightcast shows that in the UK, the top 20 skills for the average job have changed 33% since 2021! In just FOUR years!
That’s a lot of change in a short time frame. Think about the skills creeping into a range of jobs. Green skills – they’re appearing in roles from facilities to law. AI – a skill that is expected in a huge range of roles: If you’re a recruiter are you using AI for outreach? If you’re in sales, are you using AI to flag high-intent leads?
How can combining internal and external data help you stay ahead in this scenario? It helps you to understand the difference between the skills you have in roles internally, and what skills are in the same job roles externally. Keeping a close watch on skills development in the external market gives you that magic competitive edge!
5. 🌠 You can guide business direction
Only 36% of board members and executives surveyed globally believe their board’s workforce-related discussions are adequate to meet their organisation’s needs. How can we up the game on board-level conversations about the workforce of the future?
You guessed it; by combining the magic of internal and external data!When applied at a strategic level, internal and external data can shape business direction, organisation design and future capability.
How? With one eye on what’s happening to your workforce internally, start to monitor external data to identify the risks of competitor activity, identify opportunities for lower cost growth, and mitigate workforce risk in ways you didn’t think were possible! Are your competitors suddenly hiring for new skills in the same location as you? What does this tell you? How can you prepare?
It’s all about balancing workforce risk
I hope these five examples show you five very different ways of getting the magic to happen through data. Like all strategic business needs, it’s about managing risk:
If you're not predicting your attrition, then you're exposing yourself to a tactical risk of talent loss.
If you're not setting your diversity goals using external data, then you are leaving yourself open to missing your goals.
If you're not optimising your locations for risk and cost, then you're exposing yourself to either risk or cost.
If you're not looking at a granular level at the way that work is done through the lens of skills, then you're exposing your business to the risk of not having the capability to deliver what it needs to in the coming years.
I believe that the answer to managing this risk lies in the magic of combining internal and external workforce data! ✨ and this is what I see time and time again with our clients. If you’d like to read more about using data to manage risk, my colleagues at Lightcast have written a new paper that you can download here. It includes not only workforce data, but macro-level data too, bringing in yet another valuable perspective.
If you’d like to benchmark where your company is at in terms of workforce data capability, comment below 👇 and I’ll send you our Labour Market Data Maturity Curve. This free resource will give you an idea of where you are and what’s possible!
