Must-Have Metrics for Today's Top Workplace Challenges & Human Capital Risks
The way we collaborate impacts everything, including our abilities to maintain a work-life balance and get our job done. Having a collaborative culture leads to higher levels of effectiveness, as employees’ ability to produce and innovate is closely tied to the way in which they work alongside teammates and others in the organization. Good collaboration ultimately leads to a more effective organization, and the more effective an organization is, the more successful it is likely to be. With this in mind, how do we go about defining “effectiveness”? More specifically, can any metric of organizational effectiveness be quantitatively linked to financial performance? While there are many definitions, for our purposes we’ll define organizational effectiveness as “a measure of the efficacy of internal capacity and processes, adaptability, and accountability towards achieving organizational goals”, all of which are ultimately impacted by the way employees collaborate and communicate with each other. To answer the second part of that question, we can look to a variety of research that has shown that organizational effectiveness has a clear link to financial performance in terms of higher sales, lower turnover, and even higher stock values.
Now that we have defined organizational effectiveness and can point to research proving its links to financial performance, it’s imperative that we find a way to directly measure and impact effectiveness. Historically, companies have measured effectiveness based on achieving end-of-quarter or year goals. This measurement is inefficient, as fixing issues with effectiveness at the end of a quarter or year might be too late and could heavily impact long-term financial performance. The closest measurements of day-to-day effectiveness have involved laborious and infrequent surveys or interviews that only provide a subjective lens into effectiveness and deficiencies at one particular moment in time. This has all changed thanks to the explosion of workplace data, as email, chat, calendar systems, enterprise applications, and even in-office sensors are producing reams of data that can provide deep insights into how work happens on a daily basis. The way we work ultimately impacts organizational effectiveness, but the challenge lies in making sense of the data and knowing where to look. The field of workplace analytics allows companies to gather the data that matters most, discover potential issues, make informed decisions, and quickly reveal the impact of collaboration on employees and the business. At Humanyze, we have developed an even simpler way to provide benchmarks and actionable insights to improve effectiveness. Rooted in years of scientific and field research, as well as over 20 billion workplace interactions, Humanyze has developed the Humanyze Organizational Health Score™ (OHS). This score revolutionizes the way decisions are made by providing an immediate view into the impacts new strategies have on the way a company works.
The Humanyze® OHS was designed to provide leaders with a macro view of an organization’s effectiveness, as well as the ability to deep dive into actionable indicators and metrics that provide insights around specific areas of the business that need attention. These indicators and metrics are grouped into three main categories: Engagement, Productivity, and Adaptability, giving leaders the ability to observe changes and trends over time. This helps ensure that all new strategies are having the desired results, and if not, they are able to identify areas that are being impacted negatively and quickly course correct. Each category receives an average score based on indicators and metrics in that respective category, providing leaders with both high-level and granular insights that help guide decision-making and see the results of new initiatives in a timely and accurate manner. But why these categories?
Employee engagement is critical for ensuring effectiveness, as companies begin to see increased levels of attrition and decreased performance when it suffers. OHS allows us to see how engaged our workforce is by incorporating indicators and metrics around work-life balance, networking, and the way we collaborate with managers. These insights are important because they help us understand if workdays are dragging on or bleeding into the weekend if employees are cloistered in disconnected silos, and if they are effectively collaborating with managers. When leaders begin to see negative trends, they can look to these indicators and metrics to quickly make the necessary adjustments in order to maintain an engaged workforce.
On the efficacy side, our Productivity category captures behaviors that are related to higher internal capacity and efficiency in both the short and long term. Measuring things like employee focus time, internal collaboration alignment, and meeting culture help determine if any parts of the organization are operating ineffectively and show the impact of changes to improve as it happens.
The category of Adaptability measures work styles and network patterns across a company. When employees’ work styles are not flexible, their communication networks suffer and their way of working becomes highly ineffective. Another aspect of adaptability is organizational flatness, or how hierarchical an organization is, which relates strongly to organizational reaction speed and the diffusion of information.
Having this sort of understanding of how an organization is effectively collaborating is essential for maintaining and even exceeding current levels of performance. When organizational effectiveness drops, timely analytics enables companies to pinpoint problems and address them before they hinder the entire organization. With this way of working, companies can rapidly implement and iterate their management practices to continuously improve organizational effectiveness. Those that do will find themselves far ahead of competitors and well-positioned for sustained success into the future.
Learn more about Humanyze’s revolutionary new solution in our latest whitepaper “Measuring Organizational Effectiveness with the Latest in Workplace Analytics” or by visiting our solutions page here. You can also schedule a demo here.
About the Author: Ben Waber, Ph.D., is the President and co-founder of Humanyze. He is a visiting scientist at the MIT Media Lab, previously worked as a senior researcher at Harvard Business School, and received his Ph.D. from MIT for his work with Alex “Sandy” Pentland’s Human Dynamics group. Waber’s work has been featured in major media outlets such as Wired, The Economist, and NPR. He has consulted for industry leaders such as LG, McKinsey & Company, and Gartner on technology trends, social networks, and organizational design. His book, People Analytics, was published by the Financial Times Press in 2013.
Ben Waber (President and co-founder of Humanyze) received his Ph.D. in Organizational Science from MIT for his work with Alex “Sandy” Pentland’s Human Dynamics group. He is a visiting scientist at the MIT Media Lab, and previously worked as a senior researcher at Harvard Business School. Waber’s work has been featured in major media outlets such as Wired, The Economist, and NPR. He has consulted for industry leaders such as LG, McKinsey & Company, and Gartner on technology trends, social networks, and organizational design. His book, People Analytics, was published by the Financial Times Press in 2013.