What is People Analytics?
Organizations look for strategic solutions to improve their actions and decision-making. The Deloitte 2020 study found that 52% of surveyed companies plan to invest in people-data collection and analysis tools.
People analytics is a data-driven technique that helps make more informed decisions about workforce planning, which is an integral part of any company’s success.
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What is People Analytics?
People analytics is the study of statistics and data about people to make better business decisions. It could mean understanding how a company culture contributes to driving organizational success.
The key to people analytics is data.
Every company wants the best employees possible, but what differentiates a great employee from an excellent one? To answer this question, we need hard evidence of how well they do their jobs and an understanding of where these employees fit within their organization’s context.
This information can be found in data many companies use to measure success. However, with so many metrics available, knowing which will contribute the most to organizational goals can be tricky.
Organizations are analyzing their departments more closely to make better decisions about hiring and managing staff members, which will enable growth. Employee experience, before anything else, is the differentiating factor in retaining them.
People analytics teams and data analysts help companies understand their performance across various metrics, including working hours per week, the number of days missed due to illness or disability, how many promotions an individual has received in a given time frame, and transfer rates through predictive analytics on tens of thousands of high-quality data analyzed through statistical tools.
What is Meant by Talent Analytics?
Talent analytics ties to people analytics. It helps organizations better understand their competitive advantage and how to retain top talent.
It is a blend of people analytics and HR technology. It helps managers better understand the needs of their workforce, improve how they measure performance, reduce turnover rates, and, more importantly, provide tools that allow them to attract rising talent in a competitive marketplace.
Is People Analytics and HR Analytics the Same?
People analytics and HR analytics are closely related but not the same.
People analytics analyzes data related to the entire workforce, including aspects such as employee engagement, performance, and retention. It aims to understand workforce dynamics and improve organizational effectiveness through data-driven insights.
HR analytics, on the other hand, pertains to the data and metrics used by human resources departments. It often centers on recruitment, training, compensation, and compliance. While HR analytics is a subset of people analytics, it deals with more operational and administrative aspects of managing human resources.
What are the Benefits of People Analytics Metrics to Organization?
The organizational benefits of people analytics metrics are:
- Connect recruitment practices and talent management with evidence-based data
- Obtain clear and concise insights
- Reduce time to make strategic HR decisions
- Increase engagement with employees
- Upgrade HR capabilities
- Resolve turnover rates
- Set your vision into a diverse and communicative workforce
- Improve talent acquisition processes
- Lessen staff attrition rates
How to Start with People Analytics?
Now that we know a bit about people analytics let’s move to the part where we’ll know how to start. The first few days into a data-driven approach may feel overwhelming; however, persistence is key and should help you tap into organizational success mode.
Sophisticated data science is the phenomenon in charge; it provides actionable insights to understand your company’s objectives and how they align with individual performances. Discover and apply knowledge against talent management so that the quality of work remains top-notch.
You need relevant data to determine what is going on in your organization.
1. Are You Ready or Not as an Organization?
Before diving into people analytics, the first step is to determine whether your enterprise is ready for this change.
If your business is not ready for data-driven insights, making the most of people analytics will be challenging. The good news is that there are several ways to use analytics without sinking into the deep end with complex tools and complicated processes.
Whether or not people analytics is for you, you should consider what stage your organization is currently in on an organizational maturity scale.
A cross-functional team can help assess your enterprise’s current status and how it might align its objectives as new goals emerge from early stages to optimize performance at each maturity level.
In contrast, if you feel like everything’s more than a little “too much” and are not sure where to start, it might be time to call in a people analytics team—evidence-based data handlers, big data specialists, legal experts—and use their expertise to break the ice.
Analytics is more about change management and less about tools, technology, or statistics.
2. Look for People Who Know the Value of Data
The next step is looking for people within your organization who want better business outcomes.
This means you need to find people who love data, as they are the ones who can take on these new responsibilities.
Leverage their drive and passion for analytics by working with them in a cross-functional team that can assess where your enterprise stands in terms of its performance management. The new role of an HR department and HR professionals, in general, is to become data-driven and find relief in quantifiable information. It is the job design that has to change to produce employee productivity.
Like-minded people willing to take the plunge could be in other departments, such as managers, supervisors, C-suite, or board members.
It could be a game-changer in executing HR functions. The HR function that works on the hiring front could use insights to determine which areas to focus on in new hires. For example, does the organization need candidates from reputable institutes and academic backgrounds?
3. Focus Your Attention on Questions
When looking to cut your workforce costs, you’ll first have to determine where you are losing money.
Therefore, the right questions to ask are:
- Are you spending more on compensation or overtime?
- Are the rewards able to retain employees?
- Can you reduce expenses by giving them fewer benefits while keeping them happy at the same time?
The answers to these questions are going to help you build a strong people analytics business case. It allows you to dig deeper into the “why” and find the root problem.
Some more questions that need answering are:
- What are the right questions to ask your employees?
- Why do you want a new job again?
- Are there any gaps in skills that need addressing as soon as possible before they become too wide a gap and it becomes difficult for them to be filled by other people in the future?
All HR responsibilities are in for an upgrade with such a practice in action. Leaders should be aware and ready for that.
If you’re new to the human resource world and are looking to master people analytics, then don’t forget to check out our detailed top-rated human resources certification course to nourish your HR skills:
The Emergence of New Roles
HR is struggling to meet the needs of its employees at a time when they experience rapid transformation. Traditional people analytics or reporting capabilities can’t keep up with this demand, and HR leaders are searching for new roles that will help them better address these challenges, as well as emerging ones like strategic and ethical.
1. HR Practitioners, Business Leaders, and Data Scientists
All have different needs which should be considered when it comes to the future workforce. HR may want to think about defining skill sets that are in demand, while a company’s analytics team might focus on R-squared or unstructured data analysis. Meanwhile, the top management needs their questions answered by all of these people, so they know what will impact margins for their organization.
There is an immediate demand for translators who can take into account both strategic business as well as technical talent requirements before coming up with accurate models based on real-life scenarios like how many employees at any given time would receive benefits if health insurance premiums went down 20%.
The output of this people analytics project holds the key to achieving your business goals. Thereby, data analysis rescues stakeholders from a difficult point in time.
2. People’s Data and its Ethical Usage
The last decade has been a time of great change in the field of analytics. Organizations are not sure how to react, and there is an ethical dilemma that needs addressing: what are some possible consequences of using employee data? For example, without any technical advisory involved during the buying decision, algorithms have gone unchecked with little scrutiny thus far.
With data becoming a currency in the future, organizations will need people to oversee it. They’ll also have greater control over how they use the personal information of people who work there.
3. The Algorithmic Experts
What is troubling is the role black-box machine learning plays in deciding the fate of workers, especially when executives have little understanding of what these algorithms do. Data scientists can develop solutions to organizational needs, but they may not be able to explain how their code works or defend why it’s the best solution for an organization’s problem.
Organizations are dependent on data to drive better decisions. To ensure that the algorithms they use lead them in a direction of success, organizations should implement algorithm auditing roles and determine whether or not their outcomes align with what is expected.
Managers may find it difficult to convince investors against trusting their own insights. Here we find the term algorithm aversion useful. It refers to the concept that evidence-based algorithms predict the future better than humans.
Technology Application Areas
While we know that people analytics is a strategy, a phenomenon that guides an organization to make better workforce decisions, most companies provide capabilities with their reporting tools to produce and utilize insights.
However, there is more to it than just viewing reports and results. It is the intelligence of HR departments that benefits and quantifies outcomes for ultimate success. It is time to retain talent using the latest recruiting practices.
There are data transformation, data mining, and visualization features all available in one useful platform – software – to bring your people analytics in motion. Software with additional features requires rigorous manual manipulation to translate data.
Conclusion
People analytics is the application of data and statistical analysis to understand people’s behavior in organizations. It can help companies better predict what their customers want, how they will react to changes in products or services, and even identify potential staff members who may quit.
Implementing a strong people analytics strategy can have many benefits, but there are also challenges, such as privacy concerns about collecting personal information about employees without consent.
If you were considering doing some research into this area for your organization, here are some questions to get you started:
- What do you think makes your company an ideal place for people analytics?
- What are some benefits of implementing a strong people analytics strategy?
- How can you research this area for your organization, and what is the best way of doing so?
- Where would implementation be most effective? Who should have access to it, if anyone at all?
FAQs
Here are the most frequently asked questions about the people analytics:
What are the key people analytics trends to watch for in the upcoming years?
Key people analytics trends include the increasing integration of artificial intelligence and machine learning in analyzing data to derive actionable insights. Companies are also focusing on enhancing employee experience through tailored analytics, which involves using prescriptive analytics to recommend strategies for engagement and retention. Additionally, the shift towards remote work has pushed organizations to prioritize tools that can effectively visualize data related to workforce productivity and well-being.
How can organizations effectively analyze data for people analytics projects?
To effectively analyze data for people analytics projects, organizations should start by ensuring they have accurate data collection methods in place. Utilizing robust people analytics tools can facilitate this process by automating data gathering and ensuring data integrity. Once the data is collected, employing advanced analytical techniques such as prescriptive analytics will help organizations make informed decisions based on insights derived from the data. Visualizing data through dashboards and reports can also help stakeholders understand trends and patterns more intuitively.
What role do people analytics tools play in improving workforce management?
People analytics tools play a crucial role in improving workforce management by enabling organizations to collect, analyze, and visualize data efficiently. These tools provide insights into employee performance, engagement, and retention rates, allowing HR teams to implement targeted strategies. By leveraging accurate data from these tools, organizations can identify key trends, address potential issues proactively, and enhance overall workforce productivity and satisfaction.
How does prescriptive analytics enhance people analytics projects?
Prescriptive analytics enhances people analytics projects by providing recommendations based on historical and real-time data analysis. Unlike descriptive or predictive analytics, which merely indicate what has happened or what might happen, prescriptive analytics offers actionable insights on the best courses of action to take. This capability is particularly valuable in developing strategies for talent management, employee development, and improving organizational culture, ensuring that decisions are data-driven and aligned with business objectives.
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