research

2012 Metrics and

Analytics: Patterns of
Use and Value
A report by WorldatWork
and Mercer
July 2012

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2012 Metrics and Analytics: Patterns of Use and Value 1

Table of Figures
Table 1: Frequency of analytics used within the compensation function ............................................................ 8
Figure 1: Impact on compensation decisions ..................................................................................................... 8
Table 2: Who is requesting workforce analytics ................................................................................................. 9
Table 3: Organizations hold an adequate level of skill within the compensation function to perform the following
analytics..................................................................................................................................................... 9
Figure 2: HR analysis performed by organizations............................................................................................. 9
Figure 3: Number of FTEs required for HR-related analytics ........................................................................... 10
Table 4: Organizations with an agreed-upon and single source definition of headcount .................................. 10
Table 5: Raw data and tools exist to perform the following .............................................................................. 11
Figure 4: Raw data and/or tools exist for the following types of data ................................................................ 12
Table 6: Usable and/or reliable data types ....................................................................................................... 13
Figure 5: Usable and/or reliable data types...................................................................................................... 14
Table 7: Perceptions of data within the organization ........................................................................................ 14
Figure 6: Future of analytics ............................................................................................................................ 15
Figure 7: Total number of employees .............................................................................................................. 15
Table 8: Industry .............................................................................................................................................. 16
Table 9: Organization type ............................................................................................................................... 16
Figure 8: Voluntary turnover ............................................................................................................................ 17
Figure 9: Country of residency ......................................................................................................................... 17

2012 Metrics and Analytics: Patterns of Use and Value 2

Introduction & Methodology

This report summarizes the results of a February 2012 survey of WorldatWork members to gather
information about current trends in metrics and analytics. The focus of this research is to better
understand what types of analytics are conducted and what technologies are used within
organizations.
On Feb. 15, 2012, survey invitations were sent electronically to 5104 WorldatWork members.
Members selected for participation specifically noted compensation or HR generalist in their title
and/or area of responsibility. The survey was open to all members domestic, Canadian and foreign
meeting specific criteria.
The survey closed on March 2, 2012, with 693 responses, a 14% response rate. The final dataset was
cleaned, resulting in 560 responses.
In order to provide the most accurate data possible, data were cleaned and analyzed using statistical
software. Any duplicate records were removed. Data comparisons with any relevant, statistically
significant differences are noted with this report.
The demographics of the survey sample and the respondents are similar to the WorldatWork
membership as a whole. The typical WorldatWork member works at the managerial level or higher in
the headquarters of a large company in North America.
The frequencies or response distributions listed in the report show the number of times or percentage
of times a value appears in a dataset. Due to rounding, frequencies of data responses provided in this
survey may not total exactly 100%.

2012 Metrics and Analytics: Patterns of Use and Value 3

Too Focused on Benchmarks

New survey shows that many organizations may not be using all of the analytical tools available in
making the most effective pay decisions, continuing to rely on external/internal benchmarking
techniques while not utilizing the more advanced analytical methods such as simulations and
predictive modeling.
Survey highlights:

The 2012 Metrics and Analytics: Patterns of Use and Value Survey, conducted February 2012
by WorldatWork and Mercer, asked compensation leaders at more than 560 North American
organizations how metrics and analytics are used in their decision making.

Within the compensation function, organizations are more likely to use ongoing reports and
benchmarking among internal and external peer groups to guide their decisions, as opposed to
more sophisticated analytical techniques such as projections, simulations and predictive
modeling. Furthermore, there is a higher degree of faith that these less sophisticated analytics
make for better decision making.

Respondents, primarily compensation practitioners, say they lack access to and confidence in
data regarding education, competencies/capabilities and training investments data that are
often at the heart of modern workforce analytics.

In the survey of more than 500 organizations, 95% say they use analytics to externally benchmark
(and 78% of them use it often), yet only 43% use it for predictive modeling (and 12% of them use it
often). In fact, use of advanced tools trails off significantly as they become more sophisticated, as
outlined in Exhibit 1. Whichever type of analytics is used, its use leads to better decisions, albeit at
varying degrees, according to respondents.
Compensation professionals may be falling behind their peers in other HR functional areas in the use
of increasingly sophisticated analytics methodologies.

2012 Metrics and Analytics: Patterns of Use and Value 4

Exhibit 1
Types of analytics used
today within the
compensation function

Range of
analytical
strength
Less
powerful

More
powerful

perceived by
participants to lead to
better compensation
decisions
(Participants who did not use
the specified analytic were
excluded from this figure.)

Ongoing reporting

87%

75%

External benchmarks

95%

94%

Internal benchmarks

89%

87%

Projections

80%

71%

Simulations

64%

61%

Predictive modeling

43%

52%

Source: WorldatWork and Mercer 2012 Metrics and Analytics: Patterns of Use and Value Survey

What accounts for less usage of more powerful analytics?

Inadequate skill level? Maybe. Two out of every three respondents (67%) many of whom are
compensation practitioners indicate that they have an adequate level of skill to perform
sophisticated analytics such as projections, simulations and predictive modeling.
Limited staffing resources? Perhaps. Almost half of respondents (47%) have one to two full-time
equivalent (FTE) employees responsible for HR-related analytics, which would equate to five to 10
people spending 20% of their time on analytics. Given that half of the organizations have between
1,000 and 10,000 employees, one to two FTEs sounds about right for organizations that are just
starting to delve into deeper workforce analytics.
Uninterested leadership? No. According to the survey, three-fourths of respondents indicate
their top/C-suite executives and their HR leaders have requested workforce projections, simulations
or predictive modeling. Furthermore, 74% say C-suite leadership has confidence in the accuracy and
reliability of the data.

2012 Metrics and Analytics: Patterns of Use and Value 5

Limited availability and poor quality of data? Very likely according to respondents who
indicate that some data are simply not available. See Exhibit 2. Moreover, 75% of respondents say
they are undergoing developments to improve the consistency of their global data. And, 52% say its
unclear who has responsibility for data integrity.
Frankly, we have reason to be skeptical; unavailable data may signal more of a lack of interest in the
data than an ability to access it. While such data elements are often less complete or accurate than pay
data, it is noteworthy that those in other parts of human resources, such as talent management and
workforce planning, routinely rely on such data to determine their policies and practices.
In a true total rewards environment, key variables reflecting workforce capability for example,
education levels, competencies, and training and development investments should be available to
track outcomes. However, there is a sharp dropoff relating to existence of key total rewards-related
data and tools. This may signal a continued preoccupation of the rewards community with the
behavioral or motivational side of rewards, as in assessments of the pay-performance relationship,
and neglect of the asset side of the equation, that is, the effect of rewards on the ability of the
organization to secure the right kinds of people. If they are not asking questions about the latter, it is
no wonder they would not be insisting on acquiring these kinds of data.
Exhibit 2
Raw data exists within the organization
Tools exist to generate reports with this data
Headcount, FTE, staffing ratios
Contingent and contract employees
Job function, families, roles
Manager flag, supervisor ID
Termination
Retirement eligibility
Internal promotions and transfers
Performance ratings
Grade/band
Salaries, incentives, benefits
Reporting structure
Employees educational attainment
Employees prior work experience
Employee competencies
Training and development investments
Employee utilization of learning opportunities
0%

20%

40%

60%

80%

100%

2012 Metrics and Analytics: Patterns of Use and Value 6

Given all of the above, it is not surprising that the wish list of tasks compensation professionals would
like to better explore includes at the top the following two choices (57% of respondents indicated one
or both of the following):
Whether our rewards strategy effectively motivates and engages our bestperforming employees
Which elements of our rewards strategy (e.g., compensation, benefits, work-life,
careers) effectively motivate our best-performing employees.

What does it all mean?

Today, the employment deal consists of much more than the competitiveness of pay or how suitably
rewards are motivating employees to perform well. External analysis to gauge market competitiveness
of course remains vitally important to any rewards assessment. But gauging the market
competitiveness of rewards requires assessment of the value of a host of factors related to career
advancement, learning and development, work environment, culture, etc. factors that cannot be
fully captured in market or competitor surveys.
To get at these increasingly important elements requires a deeper look within, the kind of insight that
can only come from empirical analyses of the actual workforce and the business impact of specific
practices. This is where high-end analytics like predictive modeling come into play. To get there,
practitioners must push their thinking to look at a broader set of factors and implications for pay.
They must determine what employees really value as well as how careers unfold, and how they affect
an organizations workforce and drive business performance.
Compensation professionals may be falling behind other HR functions in this era of big data as
internal labor market data analysis and fact-based decision-making become the norm throughout
human resources. This is likely not the consequence of inadequate analytical know-how indeed,
historically, the compensation function has been a leader in analytical orientation and capability
within human resources but more a reflection of rewards professionals focused on too narrow a set
of questions concerning market competitiveness and pay-performance sensitivity, and not thinking
sufficiently about the role of rewards in driving human capital development as well as current
business performance.

2012 Metrics and Analytics: Patterns of Use and Value 7

As a result, professionals may want to consider:

Rebuilding a culture of analytics by examining a broader set of data and utilizing more
sophisticated analytical processes for critical decision making.

Living up to the total rewards philosophy by tracking career velocity and movement, and
accounting for important elements, such as training, education, developmental moves within
an organization and lateral transfers.

2012 Metrics and Analytics: Patterns of Use and Value 8

Table 1: Frequency of analytics used within the compensation function
How frequently does your organization use the following types of analytics within the compensation
function?
Mean

Never
(4)

Seldom
(3)

Sometimes
(2)

Often
(1)

1.51

4%

9%

21%

66%

1.27

1%

4%

17%

78%

1.47

3%

8%

23%

67%

1.85

4%

17%

41%

39%

2.21

9%

26%

40%

24%

2.67

22%

35%

31%

12%

A. Ongoing reports (e.g., headcount reports,

turnover reports) (n=551)
B. External benchmarking (e.g., data
comparisons to a standard external point of
reference) (n=550)
C. Internal benchmarking (e.g., data
comparisons to an internal reference such as
another division or line of business) (n=547)
D. Projections (e.g., future forecasts based on
current data) (n=535)
E. Simulations (e.g., what-if scenarios)
(n=543)
F. Predictive modeling (e.g., statistical or
regression analysis of current and historical
data to make predictions about future events
under multiple scenarios) (n=533)

Figure 1: Impact on compensation decisions

Our organization makes better compensation decisions as a result of our
Participants who answered Never in Table 1 were excluded from this analysis.
Strongly disagree/disagree
A. Ongoing reports (n=457)
B. External benchmarking (n=493)

Neutral

6% 19%

75%

1%

94%

4%
C. Internal benchmarking (n=476) 3%

87%

10%

D. Projections (n=441)
E. Simulations (n=408)
F. Predictive modeling (n=338)

5%
7%
10%
0%

Strongly agree/agree

24%

71%

33%

61%

39%
20%

52%
40%

60%

80%

100%

2012 Metrics and Analytics: Patterns of Use and Value 9

Table 2: Who is requesting workforce analytics
Please rate your level of agreement with the following statements:
Strongly
disagree/disagree

Neutral

Strongly
agree/agree

13%

11%

76%

16%

16%

68%

35%

31%

34%

13%

11%

77%

A. Our top/C-suite executives have requested

workforce analytics (e.g., projections, simulations,
predictive modeling) (n=468)
B. Our divisional business leaders have requested
workforce analytics (e.g., projections, simulations,
predictive modeling) (n=461)
C. Our line managers have requested workforce
analytics (e.g., projections, simulations, predictive
modeling) (n=452)
D. Our HR leaders have requested workforce analytics
(e.g., projections, simulations, predictive modeling)
(n=473)

Table 3: Organizations hold an adequate level of skill within the compensation function to perform the
following analytics
Within the compensation function, we have an adequate level of skill to conduct ...
Strongly
disagree/disagree

Neutral

Strongly
agree/agree

3%

1%

96%

17%

16%

67%

A. Basic analytics such as ongoing reports and

benchmarks (n=490)
B. More sophisticated analytics such as projections,
simulations and predictive modeling (n=483)

Figure 2: HR analysis performed by organizations

HR analysis is completed by the following in your organization (choose one): (n=495)

47%

Analysis is decentralized throughout

various parts of the organization

39%

Analysis is centralized in an analytics

center of expertise (CoE)

5%

We are decentralized but plan on

creating an analytics CoE within 12
months

9%
Dont know

0%

20%

40%

60%

2012 Metrics and Analytics: Patterns of Use and Value 10

Figure 3: Number of FTEs required for HR-related analytics

In your organization, the full-time equivalent of people responsible for
HR-related analytics (e.g., would be 1 full-time equivalent [FTE] if 5 people
spend 20% of their time in analytics): (n=495)

13%

0 FTEs

47%

1-2 FTEs

19%

3-5 FTEs

5%

6-10 FTEs

4%

More than 10 FTEs

11%

Dont know
0%

10%

20%

30%

40%

50%

Table 4: Organizations with an agreed-upon and single source definition of headcount

Please rate your level of agreement with the following statement:

A. Our organization (including finance, IT and HR) has

an agreed-upon and single source for the definition of
headcount (n=459)

Strongly
disagree/disagree

Neutral

Strongly
agree/agree

26%

10%

64%

2012 Metrics and Analytics: Patterns of Use and Value 11

Table 5: Raw data and tools exist to perform the following
Please respond regarding the following types of data
Raw data exists within
the organization
A. Headcount, FTE, staffing ratios
B. Contingent and contract employees
C. Job function, families, roles
D. Manager flag, supervisor ID
E. Terminations and termination type/reason
F. Retirement eligibility
G. Internal promotions and lateral transfers
H. Performance ratings
I. Grade/band
J. Salaries, incentives, benefits
K. Reporting structure (e.g., organizational unit)
L. Employees educational attainment and
background
M. Employees prior work experience
N. Employee competencies
O. Training and development investments
P. Employee utilization of learning opportunities

Tools exist to generate

reports with this data

Yes
99%
88%
93%
94%
98%
88%
91%
95%
94%
98%
93%

Responses
463
417
460
440
466
371
455
459
448
468
467

Yes
93%
71%
81%
90%
92%
80%
77%
86%
89%
91%
85%

Responses
459
395
450
438
459
365
446
455
445
458
453

65%

434

51%

414

50%
45%
62%

427
422
412

32%
39%
53%

408
401
398

59%

394

53%

387

2012 Metrics and Analytics: Patterns of Use and Value 12

Figure 4: Raw data and/or tools exist for the following types of data
Please respond regarding the following types of data (n varies)
Raw data exists within the organization
Tools exist to generate reports with this data
Headcount, FTE, staffing ratios
Contingent and contract employees
Job function, families, roles
Manager flag, supervisor ID
Termination
Retirement eligibility
Internal promotions and transfers
Performance ratings
Grade/band
Salaries, incentives, benefits
Reporting structure
Employees educational attainment
Employees prior work experience
Employee competencies
Training and development investments
Employee utilization of learning opportunities
0%

20%

40%

60%

80%

100%

2012 Metrics and Analytics: Patterns of Use and Value 13

Table 6: Usable and/or reliable data types
Please respond regarding the following types of data
Generally speaking, I
trust this data
A. Headcount, FTE, staffing ratios
B. Contingent and contract employees
C. Job function, families, roles
D. Manager flag, supervisor ID
E. Terminations and termination type/reason
F. Retirement eligibility
G. Internal promotions and lateral transfers
H. Performance ratings
I. Grade/band
J. Salaries, incentives, benefits
K. Reporting structure (e.g., organizational unit)
L. Employees educational attainment and
background
M. Employees prior work experience
N. Employee competencies
O. Training and development investments
P. Employee utilization of learning opportunities

This data is used in

decision making

Yes
91%
70%
84%
86%
89%
85%
77%
89%
92%
95%
83%

Responses
463
387
440
428
460
354
441
429
440
459
446

Yes
97%
76%
84%
84%
88%
78%
82%
90%
91%
96%
90%

Responses
447
357
424
395
426
332
407
430
426
454
428

49%

349

56%

332

45%
42%
54%

312
310
321

52%
51%
54%

318
308
313

54%

320

52%

302

2012 Metrics and Analytics: Patterns of Use and Value 14

Figure 5: Usable and/or reliable data types
Please respond regarding the following types of data (n varies)
Generally speaking, I trust this data
This data is used in decision making
Headcount, FTE, staffing ratios
Continget/ contract employees
Job function, families, roles
Manager flag, supervisor ID
Termination type/reason
Retirement eligibility
Internal promotions and transfers
Performance ratings
Grade/band
Salaries, incentives, benefits
Reporting structure
Employees education and background
Employees prior work experience
Employee competencies
Training and development investments
Employee utilization of learning opportunities

0%

20%

40%

60%

80%

100%

Table 7: Perceptions of data within the organization

Please rate your level of agreement with the following statements:

A. Our C-suite leadership has confidence in the

accuracy and reliability of our data (n=439)
B. Our organization is undergoing data audits/cleanup
in relation to our data (n=434)
C. Our organization is undergoing developments to
improve the consistency of our global/international
data (n=345)
D. It is clear what roles in the organization are
responsible for maintaining data integrity (n=456)
E. On average, the user interface of our analytics
technology and tools is intuitive and easy to use
(n=432)

Strongly
disagree/disagree

Neutral

Strongly
agree/agree

7%

20%

74%

17%

15%

69%

9%

17%

75%

26%

22%

52%

44%

30%

26%

2012 Metrics and Analytics: Patterns of Use and Value 15

Figure 6: Future of analytics
What would you like to better explore within your organization that you are unable to do today?
(Choose top three.) (n=452)

Whether our rewards strategy effectively motivates and engages our

best-performing employees

57%

Which elements of our rewards strategy (e.g., compensation,

benefits, worklife) effectively motivate our best-performing employees

57%
46%

The critical drivers of employee retention in our organization

40%

Whether our current sources of talent will fulfill our future business
needs

34%

Where we can reduce or reallocate workforce costs (e.g., headcount,

benefits, compensation) without diminishing the quality of output

32%

How our rewards strategy needs to adjust to changing demographics

or generational trends

22%

How we can effectively segment our workforce to identify critical

talent segments

1%

Other
0%

20%

40%

60%

Figure 7: Total number of employees

Please choose the total number of employees your organization employs worldwide: (n=466)

19%

20%
18%

15% 16%

16%

14%

14%
12%

9%

10%
8%
6%
4%
2%
0%

4%
2%

5%

9%
6%

2012 Metrics and Analytics: Patterns of Use and Value 16

Table 8: Industry
Please choose one category that best describes the industry in which your organization operates:
(n=466)
Percent
Industry
Finance & Insurance
14%
All Other Manufacturing
12%
Healthcare & Social Assistance
11%
Utilities, Oil & Gas
7%
Consulting, Professional, Scientific & Technical Services
6%
Information (includes Publishing, IT Technologies, etc.)
6%
Public Administration
5%
Retail Trade
5%
Educational Services
4%
Computer and Electronic Manufacturing
4%
Transportation
3%
Pharmaceuticals
2%
Other Services (except Public Administration)
2%
Agriculture, Forestry, Fishing & Hunting
1%
Wholesale Trade
1%
Real Estate & Rental & Leasing
1%
Arts, Entertainment & Recreation
1%
Mining

1%

Construction

1%

Other

15%

Table 9: Organization type

Your organization is: (n=461)
Type

Percent

Public sector (local, state, federal government)

20%

Private sector publicly traded

38%

Private sector privately held

29%

Nonprofit/Not-for-profit (educational organizations, charitable

organizations, etc.)

14%

2012 Metrics and Analytics: Patterns of Use and Value 17

Figure 8: Voluntary turnover
What is the approximate annual voluntary turnover for employees in your organization? (n=442)

26%

0-5%

39%

6-10%
18%

11-15%
9%

16-20%
4%

21-26%

2%

27-40%

2%

41% or more
0%

10%

20%

30%

40%

Figure 9: Country of residency

In which country do you reside? (n=242)

80%

73%

70%
60%
50%
40%
30%

16%

20%
10%
0%

2%

2%

1%

1%