Talent analytics, people analytics, workforce analytics; HR analytics is known by many names and has helped the HR function become more strategic in the last few years. Today, organizations realize the importance of cultivating reliable sources of data within the workplace and investing resources in analyzing them. A 2018 report by Alight found that nearly two-thirds of the organizations in the APAC region plan to implement more robust people analytics in the coming 12 to 24 months, primarily to solve issues relating to performance, capability, productivity and retention. (To know how HR Analytics will impact your people business, particiapte in People Matters and Alight study on HR Transformation.)
However, this data-driven approach to managing people is yet to make significant inroads in providing real-time information about the workforce. Organizations are still struggling to integrate data analytics in their everyday HR decisions and struggling to collect, manage, and read the data generated by their workforce. Thus, they are missing the opportunity to answer crucial questions about the company, its values, the workforce, and the future. While we are still a long way from using real-time information to frame HR policies and actions, organizations can initiate the process to link HR analytics with their business objectives seamlessly. Let’s take a look at how this can be made possible:
Strengthen data collection and collation
Setting up the right data sources is critical to using HR analytics effectively. If you have existing HR systems and tools, you need to collect relevant data from them and combine it for the best output. For instance, if you have engagement and performance assessment tools working in isolation, you must compare the data to determine the impact of engagement on performance. Similarly, data from functions like recruitment, training, performance management, benefits, and engagement must be viewed in the context of each other.
Review existing technology that can help you collect and organize this information easily and devise dedicated processes to collect and store data. However, it is essential to note that data analytics tools and approaches might vary depending on several factors like the size of the organization, the industry, external factors, etc. Thus, it is prudent to use the best approach when smaller sample size is available.
Derive actionable insights
Collecting hordes of data will be a futile exercise if actionable and valuable lessons are not learned from it. Making sense of data becomes easier when you ask the right questions: what is the success rate of employees completing a particular training; what is the most coveted employee benefit and by what degree; what is the average satisfaction level of the workforce; which employees pose a flight risk; which source provides better candidates; what keeps employees motivated and engaged etc.
Once the most pressing concerns of the workforce have been identified, HR managers can focus on addressing these by creating better, practical, and innovative strategies. The conversion of raw and unrefined workforce data into actionable insights will not only help organizations manage their workforce today but make predictions for the future as well.
Build internal capability
Most HR leaders and managers are probably not acquainted with the digital tools and services used for data analytics, let alone be proficient in handling them. The education and training given to young HR leaders is at odds in enabling them to devise an effective people analytics strategy as they are not familiar with how things work. Thus, building data analytical expertise within the team by hiring managers from the field and training HR leaders in how to best use these capabilities in their work.
To make the application of big data tools an intrinsic part of the HR function, the people formulating the strategies and processes must know what are the key questions to address, what information to collect, how to best obtain the data, who would benefit from the data collected and how to derive maximum value from the same. HR leaders need to work with analytical managers to hone their skills and understand the fundamentals of data analysis.
Change the mindset
Finally, the last piece of the puzzle is to change the mindset of HR and business leaders. HR is known and continues to be a people’s function with no immediate association with numbers and statistics. Traditionally, data in HR has been reduced to charts and tables with little context. Thus, there is a sense of hesitation in the adoption of newer data-oriented approaches as well. With increasing employee voice on privacy and a positive shift in perception of job hopping, retention and compliance are pertinent issues which require HR leaders to set clear goals to better understand what makes their workforce tick. As the discourse about how to best solve these challenges is intensifying, the solutions that emerge from this debate will help better the HR function further.
The effective use of HR analytics can help businesses grow sustainably in a disruptive business environment, provide unique information, and help respond to workforce challenges much more effectively. HR analytics can be extensively applied and is increasingly used to identify training needs, plan for future investments, better knowledge management, improve productivity, and achieve so much more. The rise in emphasis on analytics is not for HR to will become a data-driven function but for HR leaders to manage and engage the workforce much more effectively with the insights derived from the analysis of data. Thus, it is by asking the right questions, experimenting, failing, and learning that we can help managers and leaders to arrive at the required changes in HR policies and process with the insights to address key issues faced.
The survey HR Transformation 2019 to 2020 is live. Participating in this survey will help you to take a good look at your current HR strategy and craft a holistic approach towards adaptive HR.