February 09.2018, 4.58pm
Digital Disruption: What HR Can Do To Improve Analytics
Fans of Formula 1 may think that the race is won or lost in the skills of the drivers and the power of the cars. And while there is truth there, the real vantage point is in the analytics at play.
A Formula 1 race is the ultimate example of high-stake analytics, with engineers and team members analysing enormous amounts of data during the race. For example, the Williams Formula 1 Team pit crew have access to biometric analysis that allowed them to record the fastest ever pit stop – replacing all four wheels at the European Grand Prix in Baku in just 1.89 seconds.
This level of analytics represents a major paradigm shift for a sport that used to rely on sheer wits and skill to avoid near-disaster for racers and teams alike. Finding a strategic edge in any sport can unlock the dormant potential in your team or players. It’s not so different in business, where any competitive advantage can allow you to gain a lead on your rivals.
The power of analytics is even more relevant now as we’re living in a digital age. Data is absolutely everywhere. As the role of HR evolves, being able to access and interpret this information is becoming a vital part of the HR mission.
Analytics lets you access the invaluable data that lies under the surface of your business, which could ultimately offer you unprecedented insights into your recruitment, performance, employee engagement and talent management. Yet analytics remains an underutilised weapon in the HR arsenal.
Why HR needs to embrace and understand analytics
HR has a problem with how it’s using analytics, according to The State of Digital HR in 2017 report. One-quarter of respondents rated their HR teams as having poor skills in terms of using analytics. Just 8% felt that the current state of their HR analytics was strong.
Having access to raw data is not enough. Data is useless if you are unable to understand and interpret it in a strategic way to address potential problems. Analytics are a vital source of information and making informed decisions can drive your business growth and increase operational efficiencies.
For instance, analytics can empower HR professionals by identifying the need for additional training or mentoring, reveal if processes are not working and help you to address negative trends before they become an irreversible problem.
One of HR’s main responsibilities is identifying ways that the organisation can get the best investment from its human capital. Data analytics offers the best way to make talent-related decisions and provide accurate forecasts about the efficiency of your workforce.
The largest expense for many businesses is their payroll. Any tool that can help you to improve the value of this investment can have a major impact on your business.
Analytics can be used to improve your succession planning, identify reasons for employee churn, inform your recruitment policies, chart employee performance in incredible detail, improve your talent management programmes and measure employee engagement.
It identifies patterns that can improve planning and potentially dictate policy. It’s the difference between relying on established habits or instincts for success and knowing what works and what doesn’t.
How to improve HR analytics
Digital disruption has seen HR evolve from an administrative role into a strategic role. HR is now uniquely placed to bridge the gap between people and technology and provide strategic insight into how its human resources can be best deployed.
A CIPD report found that “silos, skills and smarts, and suspicion and scepticism” were major obstacles to high-quality analytics capabilities in organisations. Employing an integrated system will allow you to accurately mine the data that’s available.
Training HR professionals to analyse the data is vital in today’s digital climate in order to gain operational insights and leverage the available information. Introducing dedicated analytics teams or individuals can give you a powerful resource for understanding the underlying dynamics of your business and help to drive innovation.
HR also needs to effectively communicate the effectiveness of data-driven analytics to the workforce to help them to understand its benefits. This means demonstrating how it can benefit individuals as well as the larger organisation.
You need a functional system, trained analysts and the support of your workforce if you want to produce actionable analytics.
HR must ultimately convert workforces and organisational leaders by demonstrating the benefits of talent analytics in a way that everyone can understand and appreciate.
Getting the right system in place
One stumbling block to using data analytics is the use of legacy systems or multiple systems that make this information difficult to collate or impossible to analyse. The integration of different IT systems was identified as a major problem in The State of Digital HR in 2017 report. Almost half of respondents identified it as the biggest HR digital challenge that the organisations faced.
The whole point of disruptive digital tools is that they offer real-time information that’s accessible at any time. Modern HR software covers the employee experience from hire to retire, giving you access to all their performance metrics in real time.
You shouldn’t have to wait until you get your quarterly report to see how your organisation is performing. An integrated system can let you access KPIs and performance metrics to see how well you are meeting your strategic goals at any given time. This allows you to make strategic reversals if something isn’t working or to instantly identify areas for improvement.
With employee self-service systems increasingly expected by millennials and other workers, having an integrated system that fulfills your employees’ needs is more important than ever. Employees now expect a seamless employee experience and failing to provide this through technological shortcomings will impact on your ability to engage and retain star performers.
Learn how to build a best-practice business case from industry leader and Head of Engagement at CIPD, David D’Souza. Download your free whitepaper today.
By David Scully