Predicting the Future with HR Analytics
Companies have been collecting data of current and potential employees for several decades; capturing everything from performance measurements to academic history, but are organizations using that data successfully? There is not a crystal ball to show the lucky lottery numbers just as there has been no secret formula to predict the future of the organization. Now, human resources professionals are turning to analyzed internal data to view patterns and trends and are using that information to gain insights and make predictions for future outcomes of the organization. Human resources professionals are aware of the importance of using internal data to improve the long-term HR strategy. Without analytics, corporations could face an increase in skills gaps throughout the entire company, less engaged employees, a lack of internal development, along with many other challenges.
Every department in an organization can use data to predict future outcomes and to better prepare for the future, but how can HR professionals use data and analytics?
Executives can use analytics to predict potential skill gaps throughout the organization. Foreseeing skills gaps can assist in overall productivity of the organization as well as help develop individual teams. Talent management professionals can use data for many tasks including: measuring turnover, recognizing weak/vulnerable areas in the business and predicting human behaviors/trends. All can influence the overall outcome of the organization. When executives successfully use this data, they can compete with direct competitors. Analytics also helps management replicate strategies that have enhanced the overall company success and growth. Being able to follow certain employee trends and patterns allows management to put people in the right jobs; and can lead to happy, engaged employees.
Recruiting & Retaining
Organizations receive thousands of resumes and CVs every month. If a company can use data to selectively hire the right people, productivity increases. By using data from employees, recruiters can understand the outcomes and likelihood of success for potential candidates; which creates a stronger internal team. Retaining top talent continues to be a challenge for many organizations. HR leaders understand that in order to retain top talent; they must first understand the initial steps that lead many talented employees to leave an organization. Using internal data to dig deeper and to dissect the reasons for top talent turnover can give the overall organization an understanding of necessary changes. The data can tell if people are leaving because the lack of engagement, leadership, culture or pay. Being able to pinpoint why top talent leaves is a huge advantage and allows for a deeper evaluation of future business strategies.
Learning & Development
Learning executives can use data to spot areas that need a stronger learning focus. Analyzing internal data allows for executives to spot current and future skill gaps and provides leaders with a blueprint of areas to alter or increase learning methods. Assisting all organization functions with increased learning and development opportunities allows HR leaders to fill gaps before they happen and increase overall production. Executives can also evaluate the types of tools and learning methods to determine what makes the biggest impact on employees. E-learning, classroom learning, and mentoring are only a few of the ways that employees can learn and develop skills. When learning and development professionals understand the preferred learning methods from department to department, companies can extend employee retention across the entire corporation.
Shared services executives are improving internal processes by leveraging data to gain insights on overall business strategy to make better HR decisions. Applying analytics in shared services to predict future business strategies, streamline processes and identifying ways to cut costs throughout the entire company has received joint support from all business functions. Shared services professionals are working strategically to make a global impact on the organization and with the availability of quality data, this is becoming a huge source of cost cuts and a strong end-to-end business strategy.
The roles and responsibilities of senior level executives continue to transform year after year. How can an organization ensure that they have the right leaders in place? Data. Analyzed data can predict the best people for high-level leadership roles and the employees that will likely (or not) stay with the organization. It is becoming increasingly challenging to train and develop executive leadership skills due to constant advancements. Analytics can determine those individual employees with the right skills and those that are on the right track. Having the best possible leaders in place throughout the organization will continue to increase everything from employee engagement to ROI.
The uses of analytics throughout an organization are limitless. HR professionals realize they must change the ways they have operated in the past to ensure a better future for the HR function and the entire corporation. Companies have begun taking the initiative of using data to understand the current path of the enterprise. HR analytics can change the outcome for any organization. Understanding recruitment, engagement, trends and challenges to improve the overall advancement of the business can place your organization above any direct competitors.
What challenges are HR professionals facing with data?
Technology choices: When it comes to data and analytics technology solutions, the choices for technology support seems to be never ending. Understanding data technologies that are compatible with legacy systems can be exhausting. Some human resources professionals look to technology departments to make those crucial technology choices; but no other department understands the need for HR data like human resources departments. The education factor for some of the detailed solutions is a job in itself and can be very overwhelming.
Skills: Human resources professionals are not data science experts. They have not been trained in quality data, data warehouse storage, visualization, and analytics tools. For many the term big data makes them sweat. Data and analytics skills are not something that HR professionals have mastered and therefore, many find it challenging to make company-altering decisions based on their data knowledge.
Budget: Data is complex. Hiring a team to analyze organizational data can be challenging and costly. Most HR professionals are not data experts and don’t have the necessary skills to properly analyze the data. Some organizations have outsourced their data strategy and others are busy building in-house data teams. Many Fortune 1000 organizations have even hired Chief Data Officers to head up the data governance operations. However, with this new role comes another C-suite member and another C-suite budget and while HR professionals are focused on cutting costs-this adds a big one.
Organizational silos: Many business functions continue to remain siloed and this can affect the data that HR professionals have access to. When companies are still working on breaking down organizational silos, HR executives have a harder time understanding how to fix some of those challenges. In siloed companies, talent management executives might not see what has worked for employees in sales or why turnover was so high in the marketing department. Breaking down organizational silos will not only help the HR department, but the overall future of the entire business.
HR professionals are trying to keep up with the data technology space. While it remains an unfamiliar territory for many, they are completely aware of the necessity of a strong data platform. Gaining insights on employee retention challenges, future skill gaps, and even recruitment challenges, can give any HR department the "one-up" on their direct competitors. While the lines between most business functions and IT continue to blur, HR professionals are left with a steep learning curve in data and analytics.
Have you used data and analytics to predict the future? Share your experience in the comments below
Note: this article was first posted on Human Resources IQ