People Analytics: Why all the Hype?
Once considered a dispensable HR practice, people analytics is now a recognized HR discipline, an integral part of running a successful company.
The use of analytics in HR has risen in popularity in recent years. HR teams use it at the most basic level to reflect on past events and at the highest to predict outcomes.
In a recent article, SHRM makes an interesting analogy, comparing HR analysts to Oakland A’s coach Billy Beane. Beane, who was portrayed by Brad Pitt in the 2011 movie Moneyball, revolutionized baseball by applying statistical analysis to evaluate players. Like Billy Beane, HR analysts use metrics and data to build their A-team.
According to that same article The Growing Demand for HR Analysts, it’s a great time to brush up on your people analytics skills as “HR departments continue to dig into data to help understand the dynamics of human capital in way that weren’t previously possible.”
What has been the driving force propelling the use of analytics in HR forward?
We explore four factors:
The Ongoing Hunt for Talent
The job market is thriving as the economy continues to grow. While an abundance of open positions is good news for job-seekers, employers will need to be more strategic in how they acquire talent.
The use of analytics can help them be more calculated with their efforts. With robust applicant tracking software, savvy recruiters can monitor conversion effectiveness and job board performance. Armed with this information, they can intelligently tweak their efforts to reach the right prospects.
An Increase in Awareness and Guidance
With the right instruction, analytically-challenged HR professionals can tackle data like seasoned statisticians. Access to resources like SHRM’s The Practical Guide to HR Analytics and Data-Driven HR help demystify the use of analytics and guide them through the process of using data to solve common HR problems.
Deloitte has made it easy to assess where your organization ranks in terms of HR analytics “maturity.” There are four levels from operational reporting to predictive analytics. By identifying where you are on the scale, you can better strategize how to reach the next level.
Fear of Non-Compliance
The passing of recent labor laws, specifically related to Pay Equity, has forced many organizations to ramp up their access to reporting and analytics in order to maintain compliance. For many, that means turning to an integrated human capital management (HCM) platform.
New Jersey’s law is particularly aggressive. The burden is on the employer to prove that they have not violated the law by justifying any pay disparities. With HCM software, employers can conduct in-depth analyses of employees’ experience, roles, education, and salaries to identify any potential discrepancies. They can also measure the financial impact of proposed adjustments.
Access to Better Technology
Not long ago, spreadsheets were the most popular tool for gathering HR data. Anyone who has had to upload, download, or merge data knows that spreadsheets are cumbersome and error-prone.
Cloud-based technology has transformed HR. Today’s robust HCM software has eliminated the need for spreadsheets. They are sophisticated systems capable of in-depth analyses of many HR processes. Highly-configurable reporting capabilities make it possible to pull information into insightful reports for easy analysis. While dashboards provide a high-level, one-screen view of labor trends and metrics in real-time.
Want to take your organization to the next level of HR analytics maturity? Schedule a consultation with one of our HCM experts to determine if Balance Point’s solutions are right for you.