Why HR Loves Data and People Analytics

Part of a series  |  People Analytics Series

A tablet displays data and people analytics about a business

Data and people analytics can enable HR leaders to make more informed decisions about their organization, save money and build a more inclusive organizational culture.

There's nothing like walking into a large library. It's thrilling to smell the old paper and imagine all the thoughts, ideas and discoveries contained in a single building. The internet is like that too — only without the book smell and with shopping included.

That sense of discovery and new ideas that libraries and the internet bring is similar to what machine learning and people analytics can offer, only in this case it's provided by machines processing more data than we can hold in our heads and showing us things about ourselves and our organizations that we couldn't see otherwise.

Data-enabled business insights

With access to today's people analytics, it's possible to:

  • Instantly know your workforce demographics so you can understand how to improve diversity and inclusion efforts.
  • Analyze compensation across your workforce to spot pay equity issues and learn what it will take to reach pay equity in your organization.
  • View your employees' overtime needs in real time so you can adjust scheduling right away.
  • Assess recruiting efforts, know how long requisitions are open and see how long it takes to fill jobs.
  • Dig into turnover to track reasons why people leave and know when people are at a higher risk for leaving.

For HR leaders who aren't sure if they're ready to deal with more information and are imagining even larger spreadsheets, have no fear. People analytics can be well-designed, easy to navigate and a significant asset to your HR team's initiatives.

Here are six reasons why HR loves data and people analytics.

1. You're already doing it

"Analytics build on what you've naturally been doing. People data has never been more important than now," says Jack Berkowitz, ADP's Chief Data Officer. Through your HR and finance teams (and any other data hubs within your organization), you're already tracking and analyzing key metrics like cost per hire, turnover, labor costs, scheduling and attendance, diversity, engagement and budgets.

But what if all that data could be used together? What if you could also see anonymized data from other organizations? And what if someone else did all the work of putting it together and set it up so it was easy to search and understand? That's the power of workforce analytics provided by the right partner organization. That partner can consolidate your data and help you glean critical insights from it to elevate your business.

2. You know how to work and live with predictive analytics

When you look at the weather, you're dealing with predictions about rain, wind and temperature. If there's a 40% chance of rain, you might leave without an umbrella, or you might decide that the risk of getting wet isn't one you're willing to take. Similarly, map apps can tell you the quickest way to get to your destination, or they can suggest a new route that may be better suited to your current situation or preferences.

What if you had the same kind of insight into what's happening in your organization? What if you could understand trends in turnover, overtime or diversity and choose a different route instead of getting stuck? Data and people analytics allow you to forecast and prepare for changes in your organization so you can make the best choice for your business, even when the right decision isn't immediately clear.

3. The information is getting better all the time

As more organizations integrate intelligent tools into their workflows, their systems are learning more from the addition of fresh data and new ways of processing it. The insights, benchmarks and details they can uncover become richer and more useful.

Amin Venjara, ADP's General Manager of Data Services, advises that as data and analytics continue to get sharper and more robust, HR leaders should use the resulting insights to address what matters most to their organizations. "Visibility and transparency allow action. Make sure your people analytics system is set up to view data in the language of your organization. Human resource information systems (HRIS) aren't typically set up in alignment with the terms from the other departments and business units. A good analytics program makes it easy to add a layer of translation without having to update the underlying HR data," Venjara says.

What if you, and your executives and managers could get notifications about short- and long-term changes that would otherwise be impossible to predict? What if you could spot issues of concern and investigate them before things got worse? What if you could give your leaders and employees the visibility they need to take decisive action when issues arise? The better analytics become, the more insight you'll have into your organization's current and future needs.

4. Having better data and analytics makes complex issues understandable

Understanding what you're doing right and which issues need more attention is essential to assessing risk and determining where you should focus your time and resources.

When it comes to using data, Venjara's advice is to start small: "Start with your 'metrics of consequence' and build on that to create a culture of analytics. Pick a strategic compliance issue that matters and that you want to understand better, like turnover or pay equity." By integrating more analytics into your strategy over time, you can gradually build up the initiatives that matter most to your business in a calculated manner and at a rate that suits your organization's bandwidth.

What if you and your executives and managers could more easily measure the progress of new approaches you're trying and determine what's working and what's not while there's still time to learn and adjust? What if you could show your employees the progress the organization is making as it's being made? Integrating more data and people analytics into your decision-making and internal communication strategy can help you reach goals and create a more employee-focused environment at the same time.

5. Data and analytics support better workplaces

In today's competitive talent environment, which is unlike what most employers have ever seen, HR professionals are hyper-focused on attracting the best employees, while keeping both the new and existing team members engaged and in place. As Berkowitz notes, "Effective action starts with being able to see and understand what is happening."

Having the right information in a digestible state when you need it can allow you to address critical issues that might otherwise hold your organization back. For example, once your data has revealed what's working and what still needs work, you may realize there are meaningful changes you could make to ensure more equitable policies and pay at your organization.

What if people analytics could reduce the time needed to discover and investigate areas of worker dissatisfaction so HR could respond more effectively to the specific needs of their associates and the organization? Many HR professionals stay in HR because they want to help others and improve people's lives, and data can enable them to do so.

All of these things are not only possible; they're here. People analytics isn't a thing of the future; it's a critical part of successful businesses today.

6. Having the right information saves money

Reducing turnover and improving retention can help your organization save on recruiting and training costs. Faster recruiting means less productivity lost and less pressure on teams to juggle more duties while they wait for new colleagues to arrive. Additionally, having access to the data you need to schedule projects more effectively can lead to labor savings and less overtime.

This data can also be leveraged to support inclusion initiatives and track areas of concern, such as absences, voluntary turnover, performance changes and pay equity, to help reduce compliance risks.

What if you could access the information you need to make a positive difference for both your people and the bottom line? Having the analytics at your fingertips can enable you to make more informed decisions, help your employees work more productively and save your organization money.

Valuable insights are hidden in your people data. We'll help you find them.

Related article:

Dirty Data & Data Cleansing: Why They Should Matter to HR