The Rise of People Analytics

In the same way that a firm that specializes in PR and marketing might focus on analytics that describe the performance of their products or analyze behavior of prospective clients and audience members, HR departments seek to gather and analyze data on their team and their behaviors in order to make better, more strategic choices. In this brief guide, our team will go over what people analytics are and how they can help your business make informed decisions about your workforce. Read on or contact Horizon today to learn more! 

What are People Analytics?

People analytics are what they sound like – quantitative and qualitative information about your team and their performance. People analytics are a part of a detailed information-gathering process that can help characterize evidence-based HR practices. These statistics will inform your company of trends in your operations that are effective and can boost your business. 

Making Effective Business Decisions Using Data

Many people tend to think of HR as less data-driven than other parts of a firm. Unlike finance departments, some might assume, they don’t need to rely on calculations of value or profit or make any decisions through extensively analyzed data.  

This, of course, is not true – like any other function within a business, using rigorously gathered and analyzed data in HR can help you make much better decisions in a number of areas, from improving your talent acquisition, to creating and organizing job titles, to optimizing employee engagement and performance!

Analytics Can Aid a Business with Recruiting Top Talent

Using more traditional methods, hiring talent can often be something of a leap of faith – you meet the candidate, evaluate their cover letter and resume, and then you have to guess based on that limited pool of data whether they’ll be an asset or a liability to your team. This level of risk eats up time and resources that could be better used elsewhere.

By contrast, recruiting processes that have been developed with people analytics in mind can take much of the guesswork out of hiring new team members. Using historical data, you can predict employee performance with much more fidelity and “fill in the gaps” of knowledge that naturally exist when you are hiring someone new. Additionally, we all have our assumptions and biases about what makes for a great candidate, and sometimes our guts can steer us wrong!  

Using workforce analytics can prevent our own proclivities from getting in our way, and some of the time, the data-backed qualities that make for a great team member may not be what you expected.

Different Types of Analytics

There are a few different types of analytics that HR professionals can refer to when evaluating the people they oversee and making decisions. All four types – descriptive, diagnostic, predictive, and prescriptive analytics – can be used in different contexts to varying effects.  

Descriptive

Descriptive analytics simply aim to describe what’s going on – it’s straightforward data that is interpreted and used to gain further insight into a problem or situation. It does not aim to predict an outcome or set out a plan of action. Instead, it simply lists what is already there, and all of the interpretive work is done by those using the data.

Diagnostic

Diagnostic analytics both describe the situation and also attempts to lay out an explanation or broader pattern for the situation being described. This data answers the question of “why” the situation observed might actually be happening.  

Predictive

Predictive analytics attempt to make guesses regarding future events and indicate where the data may trend in the future. Using both current and historical data, predictive analytics can be particularly helpful for decision-making, especially when you use the best predictive models available.  

Prescriptive

Prescriptive analytics tell you what you and your team should do moving forward, offering actionable insights that help your business achieve its goals! Using the other three types of analytics, prescriptive analytics can offer an excellent, data-driven roadmap for where your company needs to be going and the choices you can make in the future. 

How Can an HR Department Utilize People Analytics?

So, how can your HR department actually implement people analytics in order to garner better overall results for your company? There are a few ways to really use your HR analytics to your greatest advantage.  

Utilize Metrics That Matter

With limited time and resources, it’s important that your firm focuses only on the metrics that truly matter for what you’re ultimately trying to accomplish. Too much data to sift through can bog your team down and prevent them from getting to very critical elements that can provide you with strategies for improving performance. 

Set Clearly Defined Goals for Your Business

Knowing the specific goals you’re aiming to reach can help significantly to narrow down your field of data-gathering. You can then gather only the most relevant data and leave the rest aside until you need it. Your goals will shape the metrics you look at and how you look at them. For instance, if you’re aiming to tackle internal issues within your company culture, it’s probably not that helpful to collect and analyze data regarding applicants and recruits.  

Address the Challenges of Turnover, Recruiting, etc.

People analytics are often used to solve common HR problems within companies, including issues with employee retention, recruiting, performance, and more. With the problem of turnover, people analytics can help business leaders identify the common employee behaviors associated with every departure from the company. In terms of recruiting, a bevy of relevant data can help you see the recruitment tactics that garner the best candidates.  

Use HR Expertise Alongside Data

Though it may be tempting to go with the data – especially if you have a method of analyzing data that churns out prescriptive information and plans of action – it’s important to balance data-driven insights with more holistic forms of decision-making from the HR experts in your firm. At the end of the day, HR problems are people problems, and seeing people in terms of the data points that make them up means missing out on a significant portion of the issue!  

Not only does this make you overlook critical details about the problem at hand, it can also mean that you’re seeing your team in a very piece-meal manner, which can hamper trust and cause you to make thoughtless decisions. It’s critical to strike a balance between analytics and human experience when making these decisions. 

Horizon is a Trusted Partner for Payroll and HR Processes

Horizon is proud to be a trusted payroll and HR partner that has helped countless businesses perform at their best! With scalable solutions for payroll, HR, benefits administration, time tracking, and more, our team can help your business thrive. Contact us today for a consultation! 

Tailored HR and Business Solutions

We offer tailored HR and business solutions that can assist in reaching your team’s goals, whether you’re looking to improve your recruitment and hiring process, discover ways to gather data for analytical analysis, or you’re simply looking for help with the daily payroll and HR tasks involved in managing a team.  

Contact Our Team Today for More Information

Looking for help managing your team’s payroll systems? Looking for HR and business solutions that you can rely on? Contact our team today for more information!