Can HR analytics really help businesses stay competitive? The simple answer is yes. Not only is the collection of HR data becoming a smart means for making strategic business decisions, but HR analytics is becoming a necessity for companies who are wanting to stay profitable in an ever-changing work environment.
The Challenges Facing HR in 2022
Since 2020 and the pandemic changed the nature of work for millions of workers, human resources professionals and business owners alike are working in near burnout to keep up with the growing challenges of the current labor environment. They are facing:
Skills Shortage – Not only is there a labor shortage, but there is a skills shortage. CEOs and businesses are finding it harder to locate, attract and recruit talent with specific skills needed for roles in tech, medical, legal, and engineering.
Competitive labor market – With the labor shortage and the Great Resignation, many businesses are in competition with each other to attract new talent and retain the current talent they have.
Growth in HR technology – As the world of digital develops, companies are finding more need to explore software and apps that make the lives of employees better.
What HR Analytics Can Measure and What Are the Benefits
According to Deloitte Insights, while 71% of companies see HR analytics as a high priority for their organization, the progress of implementing it is slow. The opportunity is being missed. Many stakeholders and CEOs are holding human resources responsible if they fail, and HR analytics can help make an HR department successful.
As everyone knows, analytics is the collection of data that is later evaluated and interpreted to make business decisions. But for HR, data can be collected to assist with decisions regarding recruitment, employee learning, engagement, employee performance, and HR software – everything that has potential to run an effective and productive HR department.
HR data can be collected from a variety of means. Once the company determines what information they wish to collect and the timeframe they wish to work between, they can then proceed with gathering information by means of surveys, online tracking, and transactional data tracking. Then, once the HR data is organized and aggregated, HR can begin to proceed with calculating how best to head on the challenges they face.
How HR Analytics Can Help with Recruitment Challenges
Again, the challenges facing business and HR professionals are staggering in today’s climate of tough recruitment. There are literally “Help Wanted” signs in the yards of factories and in the windows of restaurants.
HR analytics can first help companies with determining their hiring needs. Taking numbers from past years allows managers to better decide how much headcount they need during a particular time of the year. This way they can better prepare and begin their search before it becomes too late, and they are scrambling to fill openings.
HR data can be collected to also give recruiters an idea of what the job labor environment is like. Studying the numbers of unemployment and job seekers in a particular region or specialty can give recruiters and business owners an idea of whether there is a large pool of possible candidates for a job opening, or if the choices are fewer and business owners need to create tactics that will best attract top candidates.
HR data collected can also assist recruiters and business owners with their candidate searches. Information collected can be analyzed to give recruiters insight into the best tactics to attract top job seekers, such as which job posting platforms are most effective in certain demographics or regions. Or information collected and analyzed can give insight into which recruiting strategies work best for attracting and managing candidates, such as reaching out to passive candidates or advertising on social media.
Creating and preparing interview questions that pull out the best information from candidates is challenging. Data collected can assist the interviewer with asking the right questions for the particular job opening. Here, data collected can also help keep interviewers compliant and not asking the wrong questions as well.
Data can also be collected to help with deciding who would be the best hire for a particular role. For each role, information can be collected about what skill sets the top performer has, or what personality traits fit best with the role. Once that is gathered, a personality assessment can be created and given to every candidate. Once the assessment is completed, the hiring manager can compare it against the numbers to see if they match. If they do, then the HR department would be more confident of the new hire’s success.
How HR Analytics Can Help with Employee Relations
Once employers have their staff on the payroll, they need to strive to keep their people excited, and hopeful as they clock into their shift every day. The use of HR analytics makes the efforts of the HR department more meaningful and successful.
Now that so many employees are defined as hybrid workers, their needs are unique. To better understand what work-life is like for hybrid workers, it is very important to gather information from their experiences. Sending out regular surveys and having management conduct informative interviews, will give businesses ideas of how they can help make their out-of-office staff thrive.
There is always a concern about how productive employees are. HR analytics help HR professionals monitor performance. Numbers can be collected and compared to evaluate KPIs and keep staff on track with their goals. With a growing focus on training and employee learning, HR professionals are discovering that analyzing the effectiveness of certain training programs gives them crucial information in determining what is working, what needs to be adjusted, and what needs to be eliminated completely. The data collected can also provide insight into who is interested in promotions or management positions, and who could benefit from upskilling.
Employee engagement is another great indicator of employee satisfaction that can be evaluated and monitored by collecting information from stay interviews or employee surveys. This information can give insight into how an employee feels about the company culture, their job, and their view of their future in the business. With this information, companies can determine if and how to change the company culture if it is not meeting expectations. The information can also prepare management for the possibility of employees leaving.
And with the world of technology dominating the work environment, it is key that HR professionals and business owners collect information on the needs of their employees, and analyze what tools can best deliver on their promise. HR software is growing with every passing day, and businesses need to make educated decisions on what software to purchase and evaluate to determine what’s effective.
Key Takeaway
There’s no excuse for hesitation. For all the benefits a company can expect from collecting important HR data, and taking the HR analytics to make wise decisions, companies need to be embracing HR analytics immediately. This will also help companies to combat the difficulties we are all facing since the world of work is like nothing we have seen before. The only question you should be asking now if you are not doing this today is, “How do we get started?”.
WRITTEN BY Bruce.Marable
Bruce Marable is the CEO of Employee Cycle, which aggregates all your data from various HR systems into one real-time and beautiful HR dashboard. When Bruce is not helping HR leaders become more data-driven, he is hosting the “Employee Cycle” podcast and interviewing professionals about HR trends, tech, and data.
SOURCE: https://blog.shrm.org/blog/why-hr-analytics-matter-in-2022