3 HR Analytics Pitfalls That Kill Credibility

A turnover dashboard shows 18 percent attrition, finance's headcount does not match HR's, and the budget ask sounds like sentiment when the board wants a business case. That gap is where HR loses the room. Emily Granholm, an HR and people operations leader with 17 years across high tech, federal government, and manufacturing, spent her most recent years inside a PE-backed company, where the board funds the business and reads every number in financial terms. Her case is that HR earns trust by translating people data into that language first, then asking.

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Why don't finance and HR agree on headcount?

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They pull from different sources and define the same event differently. HR usually marks a departure on the employee's last day at work. Finance may mark it when severance ends, which can slide a termination into the next quarter and throw the counts off. Duplicate reports, payroll feeds arriving at different times, and teams that never agreed on what makes someone a full-time employee widen the gap. So the sequence matters: "audit it before you build any type of dashboard," Granholm says, and the numbers hold up when the board pushes back.

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How do you turn HR reports into decisions the board acts on?

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Start with the business question, not the data. Name the problem, whether it is voluntary turnover in one department or a climbing time to fill, then frame the stakes both ways: what breaks if nothing changes, and what improves if the initiative gets funded. Business literacy comes first, because how the company makes money is the language the room speaks. As Granholm puts it: "you can run reports all day, but are you actually making actions and plans and building your business strategy around what those reports are telling you?"

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How should HR ask for budget?

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The strongest pitches treat an HR initiative like a capital investment with a return. As she frames it, "you want to be able to pitch your HR initiatives like a business investment," which means converting people metrics into terms the board already uses. Retention becomes cost of vacancy plus replacement costs plus lost revenue risk. Time to fill becomes days of capacity lost times the margin per role. Framed that way, an engagement survey earns its budget line: it catches turnover before the cost reaches the P&L.

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Why is retention the wrong number to watch first?

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Because it only reports what already broke. Retention is "ultimately the lagging indicator of everything else that has gone wrong," a line the host carries over from a prior guest and Granholm builds on. By the time the number moves, the experience that caused it happened months ago. She works upstream with eNPS and stay interviews, backed by enough psychological safety that people answer honestly. Those conversations surface what keeps someone showing up, and whether the benefits still work once an employee adds dependents. "People stay at companies that they like, and when they feel like they're treated well."

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How does HR stop being treated as a cost center?

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HR stops being treated as overhead the moment it reports to the CEO rather than into the balance sheet. "HR should be like your strategic partner ... we're not a cost center and it doesn't have to be one," Granholm says. Filed under finance, it looks like a cost. Positioned against how the company makes money, it becomes the function protecting the asset every other team depends on. As she puts it, "ultimately people are your profits. You can't run your business without your people."

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The through line is translation. HR that walks in with the story the data tells, in the board's own terms, finds the budget question starting to answer itself.

Logan (00:00): We're going to talk about HR and data and analytics and how HR can tie their initiatives to revenue, which is all about what our audience cares about. I'm here with Emily Granholm. Emily, what should the audience know about you?

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Emily Granholm (00:00): Well, I am a HR manager and people ops professional with 17 years in the business, working across a variety of different industries, from high tech startup all the way through federal government and more recently manufacturing. I love what I do. I like enabling teams to kind of bring their best to work. And I like the psychology behind things, figuring out what drives results from our people.

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Logan (00:42): Awesome. Well, we're going to dive into all of that. But to kind of set the stage a little bit, we're going to talk about HR on data, because most recently you took a stop with a PE-backed company. So that's kind of gives a different lens on data, because a lot of our audience operates in PE-backed environments. And so I wanted to kind of kick off with pitfalls in using data. And what's, when HR teams come into really needing to use data to get executive buy-in, like what are the common mistakes they usually fall into that you see?

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Emily Granholm (01:20): So I'd say there's three pitfalls that people typically fall into. You know, that's inconsistent definitions with the team, bad hygiene with the data there, so mismatch sometimes, and analytics without a business question. Because you want to be able to solve a problem, and you can have a ton of data in the background, but if you're, like, you know, from all different sources, but if you're not using it to drive your actions as a business, it's pointless. So, you know, those are the three pitfalls that I see a lot of teams kind of fall into. Because there can be discrepancies between what the headcount is with the finance team as opposed to how HR is calculating headcount. Or this person just ended on the last day of the month, is he still included in that month? Little things like that, but it makes a difference, and you want your data to be accurate.

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Logan (02:13): Yeah, that's interesting. The definitions is interesting. Was actually just talking with First Key Homes, one of the HR, I guess, managers there, and he mentioned the discrepancy between how finance is calculating headcount versus HR. Like, why does that happen?

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Emily Granholm (02:30): I think there's maybe a variety of different reasons. Finance typically will use their ways with the spreadsheet, or you just kind of get used to doing things a certain way, and this is how they've always done it. I don't think that HR teams are all, like, there's a lot of people with an HR working in the field of HR, but they don't necessarily have like a data analytics background, right? So maybe they're not calculating things the same way. Or there's just not open communication, right? Like, that's why you need to kind of have the clear definitions on, well, you know, for a person to be considered an FTE, full-time hire, you know, they need to be here from this date through this date, and making sure that like you're aligned and matched with other various departments. So I know that's sometimes where the miscommunication can happen.

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Logan (03:14): Yeah, that's... He had mentioned kind of something similar, and I, to be honest, I wasn't aware that there was that big of a discrepancy between the two, but it's like, I guess a lot of people fall into that. Yeah.

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Emily Granholm (03:23): There can be, there can be. Or just duplicate reporting data. That's not, I mean, you're kind of trying to figure out the same solution, but maybe it's pulling it from different sources, right? And when is that data feed coming over from payroll, as opposed to, I don't know, they're pulling it out of Vizier BI or something like that.

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Logan (03:41): Yeah. Okay, I want to get to the second one, the hygiene that you mentioned, and we're going to spend the bulk of our time on business outcome, because I think that that's like one of the bigger things. So for data hygiene, like what are some of the initial signals that people should be looking for that maybe they need to clean up some of their data hygiene?

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Emily Granholm (04:04): Yeah, I would think that you need to kind of like prioritize, okay, well, are all the departments like using the same language and using the same like sources for data, or is there one universal place that it's housed on a dashboard or something? And then you want to make sure that the data is aligning with what the figures are and facts are, that you're kind of like trying to make sure it is accurate. Because when it's not accurate, you don't want to lose credibility for the data that you're presenting. Like, well, we had 16 terms last quarter. Really, doesn't a lot. Maybe you term people that say that, I don't know, the HR team is counting their term as their actual last day at work, or their actual end date. And then, I don't know, for some reason, finance is counting it as when their severance ends, or say they've got a, you know, month severance. So I'm just trying to think of something that would create some discrepancy, when you're going through and you need to be able to kind of clean it up and make sure that it's accurate. So go ahead.

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Logan (05:07): That is interesting. Because the severance is depending on... would it depend in the, I don't know if you know this, but in the finance realm, would it depend on if the severance is paid as one lump sum at the start and then they align the term dates, or do they pay it over a period? Like if you get three months severance or something.

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Emily Granholm (05:28): Yeah, I mean, it depends on how it's written, either in the executive's agreement or the team member's agreement. You know, because I've seen it done both ways. I've seen it be paid out, like, you know, if there's like a mass layoff, I'll do it as payroll cycle so that it's not a lump sum, but I've also seen it paid out as lump sums. So I think it varies, like, there's a lot of different ways to get to the same result. So I think the biggest thing is communication. So making sure that the departments and teams are aligned on, like, okay, well, this is what we're using as far as this goes. Because if you think about it, that's probably where a lot of the mix up is coming from, right? People aren't communicating and they're just doing things the way that they think it should be done. And then all of sudden, you've got a discrepancy in the information that you're sharing to try to, you know, get budget or paint a story.

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Logan (06:15): Yeah. And if nothing else, it's just good to know, if like for the HR folks listening, if they haven't worked with finance yet, or they're kind of early on in this process, just knowing that there might be a discrepancy, especially when it comes to how they're determining when it's happened. Because it's going to be when the money hits, and HR is probably going be looking at when people items hit, not necessarily the money. And just knowing that, then you can go in with a proactive conversation and get alignment, because you kind of know which sides are doing what they need to do.

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Emily Granholm (06:47): Yeah. And then audit it before you build any type of dashboard. So.

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Logan (06:58): Yeah. Yeah. And the last, the third item, which is actually the second question that I wanted to touch on with you, is around... so you've gone through it, you got your definitions, you've got your hygiene, and now you're going to start running reports. But how do you go from just thinking in reports, thinking, you know, adding data and dashboards, and actually turning that data from reports into insights and actual business actions? Like, that's the next question. Making that leap from just reports to actions.

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Emily Granholm (07:26): Yeah. So I would definitely say that you need to, one, look at the business question that you're trying to answer from these reports, right? Whether it's turnover, whether it's regrettable attrition, whatever the kind of like business problem that you're trying to solve. You know, we've had a lot of voluntary turnover in, you know, this department in this quarter. So look at that. And then you want to kind of find the insight, what changed, from who, and why. Like, those are kind of the key core issues that you need identified before you kind of even start like looking at the data. Because like I said, you can have a ton of, a ton of data, and we're all looking, we're looking at it all the time. We just don't always think about it as like, this is a data point, or you know what I mean? Like, you think sometimes data is just like living in spreadsheets, but data is everything. And then you want to look at kind of like what the financial impact is that you're trying to solve.

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So making sure that finance is aligned with HR, with the executive board, with any type of leadership, that's especially in a PE-backed company. You know, we're typically run by board, and they're what's funding the company. And then you want to kind of like look at those reports. So what is the variable between, okay, if I do nothing, this is what's going to happen, and if I choose to act, this is how we're going to change the scenario, change the situation. Then you want to kind of look at like, okay, well, what are my recommendations for this report? Because you can run reports all day, but are you actually making actions and plans and building your business strategy around what those reports are telling you? And then you want to basically formulate what your proposal is based on the story that the data is telling you, to be able to speak the language of CEOs and, you know, various finance people. Because I think that's the biggest thing, at least in speaking with other HR professionals, that they struggle with sometimes, is using the same, same language, you know, understanding the cost analysis and EBITDA and all the different things that kind of tie into the business. The best thing you can do as an HR professional is kind of like understand how the business actually works. How does the company make money? What are these problems, what are the people problems in relation to how that's impacting the business overall?

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Logan (09:44): Yeah, I love that you mentioned understanding how the business makes money. This is the third... I've done a few of these. I think we're at like 12 or 13 recorded. Like, I've got seven, six or seven released. And you're the third HR professional that's mentioned understanding how the business makes money. And what's interesting is I come from the marketing background, and even in marketing, people don't always understand how this makes money. Because you have all different facets of the profession. HR is the same way. The comp professionals, they're in data all the time, so they often know where the money flows a little bit easier. But if your primary thing is running engagement surveys or other things, it may not have thought about the connection there, of where it makes money. I really love that and want to emphasize that for all the listeners. And one of the tips that Nicole Logue, we had on the show, mentioned was like, just partner with finance, talk to them and ask them about it. Partner with sales, ask sales where they're selling all of the stuff that they need. So...

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Emily Granholm (10:52): Yeah, no, you want to know every part. That's what makes you a strong leader anyways, is understanding why things work the way they do, and what's working and what doesn't. Because you've got to take action on the insights, but you don't want to make the wrong action, because things can be a huge costly mistake. But yeah, I agree with you. Everything is... because, yeah, marketing people don't always understand, okay, well, what is the return on investment for doing this marketing proposal or rollout that is going to come back into the business? Like, HR can be the same. Like, we're not, it's not just fluff. There's got to be a business and financial reason for making the actions happen or not.

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Logan (11:28): What advice do you have for folks that are needing to take those insights and make them board ready? Whether or not they're actually presenting to the board, because oftentimes you might be just compiling decks so your CHRO can go to the board with it, or it can be read in a pre-read. What are some of the tips that you have for folks to just kind of shift their mindset a little bit that way?

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Emily Granholm (11:57): Yeah, so you want to be able to pitch your HR initiatives like a business investment, right? If you can kind of switch and be able to speak their language so that you're talking to the board in ways that they understand. Think about retention as cost of vacancy plus replacement costs plus lost revenue risk. Or time to fill is technically, it's a days of capacity lost, and then the margin per the role. You've got to be able to kind of like turn that context into a story that supports what you report and what your data is showing you, so that it resonates. But to be able to kind of like understand just the language... I remember talking with different accounting professionals and finance people about how to, because even when you're having like all hands meetings, like there's a lot of people that don't understand what is EBITDA, right? And their eyes just glaze over when you're talking to them about it. But I think when you have a clear understanding of what this actually is showing you, the reports make a lot more, a lot more sense. And then you're able to kind of like take those insights and use it to drive actions that will improve the business overall.

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Logan (13:08): Yeah, and EBITDA most often is profit, for those listening. I realized, like, as you're saying that, I use EBITDA on the show all the time, and I'm like, we never ever defined it. So I hope listeners go off and find it.

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Emily Granholm (13:11): Yeah. I think it's earnings, earnings before taxes and depreciation. I'm missing something, but it's okay. It's a... there's two different, there's EBIT, EBITTA and EBITTA DAH, or like DAH. Yes. It's profit. It's profit. What's on your, what shows on your bottom line after all the other expenses?

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Logan (13:25): Interest, taxes and... It doesn't matter. It's profit. It's the net. It's the profit that they're all after. Yeah, we're not going to get into whether or not we know all the acronym. But understanding... so retention is a super interesting one, because in tech and in white collar industries, I don't know, it's not as...

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Emily Granholm (13:47): You can cut that.

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Logan (14:01): ...difficult as it is in frontline industries. Like, there is two different worlds there. But like you mentioned, like, down productivity, you know, the cost to hire. But the question is, like, if you're losing people, when you hire somebody else, because, you know, there's persistent labor shortages, and like, are you going to hire somebody that's going to want to stick around? Like, it's such a difficult thing, the retention number. I mean, there has to be formulas that tie that number to the bottom line for the board.

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Emily Granholm (14:36): Well, it's all absolutely... and it's all connected, right? When you can look at it like the entirety of like, you know, an employee experience, if they're coming in and they're staying there. I mean, you can use engagement surveys and stuff to be able to kind of like pull data if you're having pain points, if you've got high turnover in a certain area or in a certain department, or, I mean, overall. And yes, I think it is a very different industry, you know, just being in high tech versus like, you know, a frontline workforce in a manufacturing environment. Very different caliber of worker that you're hiring, but still you've got to kind of look at the overall picture of, okay, well, what is that employee experience? What's going to keep them here? And sometimes it can be super simple fixes, right? Like, say their manager has really poor soft skills, right? So nobody wants to talk to him, or he's a jerk, and so they leave the company. I mean, those are... you can usually coach the manager, and you'll see a change in kind of like the retention numbers that are coming back. I've always kind of figuring out the problems pertaining to retention, because yeah, it's all connected. And then it depends on how hard is the position to fill. Like, is it a well-paid position, or is this like a super specialized skill? I mean, because think about the time that the vacancy is open, that's costing money. The burden that sometimes, like if it's, you know, a small department, say there's only three people and one of them leaves, it's, you know, a specialized engineer or something, or maintenance tech, whatever it may be, and it's harder to find that skillset. And the other workers are taking on the burden of, you know, being short of person. I mean, that, again, weight on other people, and it's fine if it's temporary, but I see companies sometimes in the positions are just open for a very long time. Maybe teams aren't necessarily saying anything, but they're looking for their next opportunity, or they're just disengaged, or doing the bare minimum to be able to keep their job, you know.

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Logan (16:26): Yeah, and it's interesting that you mentioned that you like diving into the retention number, because Stacie Baird, who we did a webinar with and we released, we did a podcast with her as well, said that retention is ultimately the lagging indicator of everything else that has gone wrong. And so, but everybody looks at turnover and retention number as like, let's look at that one, but there's so much up the, the experience funnel, if you will, that you have to look at. How do you recommend, for HR professionals who are tied to the turnover number, maybe they want to improve it, and they need to shift the conversation up the other indicators earlier for employee experience than retention itself?

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Emily Granholm (17:13): I would say that the eNPS number ties highly into that, and you want... so I would want to survey my employees. I would want to, you know, and then make sure that they've got the psychological safety that they're able to kind of like be honest. I don't want to hear everything's great. You might be able to do this in focus groups, it depends on your organization, but I want to survey and kind of see what's going on. You can do stay interviews to kind of like figure out, okay, well, what keeps you working here? Why do you like working here? You've been here, you know, three years. What brings you to work every day? And, you know, you learn, like... and those are all, that's all data points that you're gathering.

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So that to kind of play into, okay, well, what action should we be taking? Well, I don't want to stay here because the benefits are horrible, right? It's fine for me, but once I have to add my dependents, the cost is just astronomical. It's almost as much as my entire paycheck. You know, I'm just making up different situations that could come up, but you know, or like I said, that people are leaving because they're not addressing a toxic employee, right? And they just seem to get away with everything, and it makes the dynamic unfair, and so like people resent that. But you're not going to find out any of these things to be able to kind of like bring it up the chain and address it to the board and the executives, unless you kind of like pinpoint what the pain areas are and what's causing a lot of these issues, or what's causing the retention issues. Because yeah, like you said, retention is kind of like the last thing. People stay at companies that they like, and when they feel like they're treated well. And they don't, it's a subpar experience.

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Logan (18:46): Yeah. And so to kind of go back to where we started in this section around treating your initiatives like a business investment: if you're going to say we need to run an employee survey, the reason you're doing it is to try and catch turnover before it happens. And that's the bottom line number, is really the investment, rather than we just want, you know, a sentiment survey to see how we're doing. It's, you know, we want to prevent turnover. We want people to stick around.

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Emily Granholm (19:15): Yes. And that's exactly, that's exactly it. But you don't know, and people aren't always comfortable just come and say, well, you know, I hate this new policy that you've rolled out and it really kind of, I don't know. Or, I don't like this new director and we seem to butt heads. Or there's so many... but if you don't know what's going on, then you're not going to be able to act accordingly. And if your people aren't honest, and you haven't built that trust, I mean, HR is all about building... running a good business is all about building good relationships and having that connection with people, because ultimately people are your profits. You can't run your business without your people. Bottom line. So yes, AI can do a lot of different things, but there's a lot that it still can't do.

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Logan (19:56): Yeah. Yeah. And ultimately, like, I was speaking with somebody, and she mentioned that really HR should be on the forefront of AI in the business, because the AI is going to impact how people do their jobs. And so they kind of have to be on the forefront of that.

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Emily Granholm (20:10): Yes, yes. Well, there's already so much tech integration. I mean, you look at some of the big companies that are merging their CHRO positions with, you know, IT directors. And what, I think Moderna did it recently, they've consolidated that role, like the CTO and the CHRO is now a single position. But I mean, it makes sense, because there's so much tech integration into just running business operations day to day. And you've got to kind of have, be technically savvy and able to build workflows and infrastructure that connects and talks to each other. So you need somebody with a technical background, but you also want to do things that are legal and compliant and not going to end up getting you in a lawsuit. So you need kind of a merging of the two.

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Logan (20:57): Yeah, and that's interesting. I've seen and heard of HR being under kind of the finance arm, but I haven't seen it yet under the tech arm, which is actually super interesting. I would imagine, as private equity companies are becoming more and more popular right now, watching what they're doing in that space is going to kind of be like what VC backed companies were doing in the 2010s, I think.

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Emily Granholm (21:25): Yeah. It's gonna, it's gonna switch. And I know that there's still companies that have HR paired with finance, and it's... but that's because it's like... and I've tried to shake this idea from people as well. Like, HR should be like your strategic partner. It is like, we're not a cost center, and it doesn't have to be one. I think when it's housed sometimes with finance, that's how it look, is looked at. Like, really you should be partnered with the CEO and...

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Logan (21:26): It'll be interesting to see how that kind of shakes out.

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Emily Granholm (21:53): ...driving business decisions with all the input from the other. I mean, that's what a true HR leader does.

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Logan (22:00): How do you make that leap from being reactive in HR to proactive?

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Emily Granholm (22:06): You want to know what's not... what's not working. So I hope your employees are comfortable and feel safe to be able to tell you, like, yeah, this new platform that you rolled out for the sales team is horrible and cumbersome, and it's actually, it's not helped. Like, so that you're getting feedback that you need. Okay, well, maybe they just need more training, or maybe we actually picked a clunker of a tech stack that's not integrating well with our systems. But your people need to have that psychological safety and trust to be able to be honest with you. I've always liked people around me that are gonna tell me the things that I am not doing well, so that I can fix those things. I don't want blinders on. I want those no people, that are like, no Emily, that's a stupid idea, or I don't know if I would run with that. Because all of my ideas... some of my ideas are great, but not all of them. And, you know, I want people that are comfortable enough with me that feel okay telling me, like, yeah, no, I wouldn't do that. Or just being honest and direct. But we see a lot of that lacking sometimes in the business space, especially as you move up levels, right?

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Logan (23:12): Yeah, yeah, that's a good call out. But just thinking, how you're going to become proactive rather reactive and being a business partner. Well, great, Emily. This has been a great conversation. Is there anything else you would like to leave the audience with, in shifting their conversations with the rest of the business to make HR be seen as a revenue enabler?

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Emily Granholm (23:38): I think, like I've said throughout the podcast, you want to be able to speak the language. You know, highlight the story that the data is telling to be able to support your ideas, to get you the budget, and be able to speak with finance so that they understand the framing around like where this data is coming from and how it tells the story, to be able to be proactive with some of the situations that you see. Yeah, you can make strong decisions that are going to result in a healthy, productive company with a, you know, strong culture and people that enjoy working there. Because you need your people. They're what's going to make your company money, and you want them to be happy, or not always happy, engaged.

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Logan (24:23): Well, good, Emily. So where should people connect with you?

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Emily Granholm (24:26): So I'm on LinkedIn. You can find me at the LinkedIn, just search my name and I come up. I do the People Pulse Collective as well, so talking with various HR leaders. And I'd love to connect.

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Logan (24:38): Awesome. Well, great. We will link both of those into the show notes for everybody to connect with you, Emily. And I want to thank you for taking the time to chat with us today.

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Emily Granholm (24:47): Thank you so much, Logan. I very much appreciate it.