Laurie Bassi is an internationally renowned HR analytics expert. She works with a variety of clients—from startups to Fortune 100 companies—to help unleash human capability and improve organizational performance using behavioral economics.
Prior to founding McBassi & Company, Bassi served as vice president for research at ASTD and a tenured professor of economics and public policy at Georgetown University. She also is a licensed investment advisor who, for more than a decade, has been generating above-market returns by investing in companies with superior human capital management.
Bassi is the author of the 2011 title Good Company: Business Success in the Worthiness Era, which won the 2012 Nautilus Gold Award for the best business leadership book of the year and Choice magazine's 2012 Outstanding Academic Title Award, and was selected as one of the year's top business books by Soundview.
How did your career in academics and research prepare you to be a business owner and consultant?
As an academic I researched the labor market, looking at low-income working adults and how to help improve their earnings and employment capability. This is how I eventually got into workplace education and training—the research I completed made it apparent that there was a tremendous need for improved measurement on the people side of business, and investment in people in particular. These findings set me on my path outside of academics, first to ASTD, and then ultimately as a business owner, trying to work on and improve measurement and evaluation.
As far as how my career as an academic prepared me for business, I learned how to take complex ideas and simplify them to their essential kernel. One of my standard jokes is that the most important thing I learned as a professor was how to take a semester's worth of material and teach it in 15 minutes, or take 15 minutes of material and teach it in a semester. So communication was one of the most important skills that I learned.
I also learned how to maneuver in complex political environments—which universities are—where the rules often are not clear, and where governance and power structures sometimes are hidden. Georgetown, perhaps more so than other universities, was a place where entrepreneurs could really thrive—if you had an idea and some "get-up-and-go," you could make things happen there. I didn't know at that time that I was an entrepreneur, but I was.
How does using behavioral economics in today's workplace improve organizational performance?
We are in an economic era where it is not merely human capital—because there are smart people everywhere—but human capital management that is one of the few remaining sources of sustainable competitive advantage. Given that there is a convergence of economic, social, and political forces that separately and together are rewarding companies that have developed a capability around superior human capital management, the management and development of people is preeminent and far too important to be left to intuition alone.
Using the tools that are coming out of the psychology and economic professions, and then putting the two together in what is called behavioral economics, helps to bring true precision and rigor to the people side of business management, where competitive advantage is increasingly defined. It's simply too important not to do it.
In what ways will HR analytics evolve during the next 10 years?
Analytics is clearly a very hot topic right now, and I think it will continue to be an important and rapidly evolving trend. At the top of practitioners' agendas will be the goal to become smarter and more effective at the use of HR analytics, which I think will become more common and more deeply embedded in HR and training units in the next 10 years. We'll see an influx of people (we're already seeing this) with analytics skills from outside of HR, who may come up through finance into the HR function, for example.
Also, an increasing number of young people coming out of school who are going into the HR field have the background, perspective, and affinity for analytics, so I see it becoming more central to how decisions are made on the people side of the business.
Your book Good Company makes the case that bad companies will wither while worthy ones will survive. What are the most critical characteristics shared by good companies?
We were able to boil it down to three things: Good companies are good employers, good sellers, and good stewards (of communities and the environment). Of those three, we believe—and our research certainly suggests—that being a good employer is foundational.
There are three essential characteristics of good employers: They are inspiring (worthy of people's best efforts); they are caring (they demonstrate what we call reciprocity); and they are exacting (they believe in using fact-based analysis on the "people side" of the business). It's surprisingly difficult to be those three things simultaneously.
As a licensed financial advisor, you have experienced the benefits of investing in companies with superior human capital management. How can training and development professionals also invest in and manage their organization's human capital to ensure business success?
First, if an L&D professional who works for a publicly traded company feels confident in his organization, he should invest in the stock of his own company. When you choose to work somewhere, you are making a huge investment. It's not a very diversifiable investment because you are giving all of your working time and energy to one company, and in that sense you're taking a considerable risk. You want to go with a winner, not with a loser in this regard.
If I were an L&D professional—and I've dispensed this advice to many clients over the years—who finds herself in a company that does not "get" the need to invest in the people side of the business—and appears it never will—think about going elsewhere. You are investing too much of your life to stay at a place where it's unlikely you will be able to create the kind of benefit you could in an organization that does understand the importance of the people side of the business.
Having said this, there are a lot of firms in between. They are not yet A-level companies, but there's some hope for them. They may be a B-minus to a D company in terms of where they stand on the people side of the business. If you're in this situation, somewhere between an excellent company and a disaster, work to make a strong business case. Sometimes executives can be turned around based on the power of evidence and the logic of the argument for investing in their people.
Are you working on any new books or special projects?
I'm in a bit of a writing hiatus now. Good Company took a lot of work—it was 25 years in the making. In the past couple of years, as part of my professional volunteer work, I have been helping to create human capital standards.
Some of this work I did with SHRM, which has a standard-setting effort under way. As that process was taking place, there was a simultaneous effort happening called the TDRP—Talent Development Reporting Principles. The TDRP has been institutionalized through the Center for Talent Reporting (CTR), a not-for-profit established to make progress on these people standards and metrics around talent, management, and development. I continue to sit on the board of the CTR because I think these are very important initiatives for both L&D and, more broadly, HR.
What do you like to do for relaxation or fun?
I live in Colorado, so I love hiking. I'm also an avid gardener. And I am, if I do say so myself, a fabulous cook. I love to feed people, especially with food from my garden.
I sing in a group called the Threshold Choir, which is a group of almost all women who give what is called the "gift of voice" at the threshold of people's lives. There are about 100 of these choirs around the country (I sing in the Denver choir) that perform in hospitals or hospices for people who often are in their last hours of life. My choir sings in a palliative care unit at St. Joseph's Hospital.