Businesses that are not investing in data analytics today will be in the very near future or someone else will be doing it on their behalf. According to the latest data, Talent is the single most important item on the minds of CEO’s today. One of the reasons that Human Resources is lagging behind the trend is the complexity and magnitude of HR data available. Organizations that are able to correctly analyse HR data and integrate it into the data available from other operational business areas will gain a distinctive competitive advantage.
In many emerging markets, well established belief systems and ways of working present a significant challenge to businesses. It is through proven data and analytics that such methods can be successfully introduced and established.
The following are the key issues facing Human Resources in terms of data analytics.
Proliferation of available HR Data
HR executives are asking themselves what they can do with all the data in HR and other operational areas of their business. The areas in which some organizations have used data effectively is in the selection process, managerial effectiveness and employee engagement. There are still significant opportunities in emerging markets to increase the use of analytical methods in selection and even greater opportunities in management development and engagement.
The emergence of HR analytics
30 years ago the emergence of ERP systems revolutionized the data used in effectively operating and managing finance, manufacturing, sales and marketing. Organisations that have effectively completed such initiatives have developed robust processes and data to effectively analyse, monitor and improve the operational efficiency of these functional areas and will not tolerate the quality of data that currently resides within HR.
Changing the way that we work in HR
The challenge for HR is to implement robust processes and revolutionize their use of data. Some organisations have done this and as a result they are more effective at identifying and selecting candidates, they understand and improve the leadership pipeline and the leadership believes that the function adds significant value to the business. The emerging markets provide the largest opportunity to transform the way that HR functions, integrates with other business areas and is perceived as adding value.
Developing Patterns of integration with other business areas
HR must focus on monetising the value of their data and integrating with the operational processes that are typically defined as adding value. Embarking on an exercise of data optimisation and analysis in isolation will result in large expenditure without the required quantifiable benefits to be obtained. Traditional HR processes must be integrated with the operational processes so that there is a clear understanding of how HR data can significantly add value to the business.
Planning the way forward
Organisations must identify the operational areas that bring the most value or present the greatest operational risk to their businesses. Data must be obtained from the operational areas and interpreted together with the HR data to ensure that is it specific and relevant.
Talent as previously mentioned is the single most important issue on the minds of CEO’s and Human Resources must focus on this area across the entire range of HR processes.
Data from operational areas must be combined with HR data to ensure that work is not completed in isolation.
For example the profile of which people are the most successful at sales must be obtained from the sales area and then combined with the data that currently exists or is yet to be obtained from HR. Global and regional data must be applied in conjunction with the data found in the organisation.
Most companies are still doing reactive data analysis and the speed at which they improve the quality and accuracy of data and integrate it into the operational data will be a determinant of a successful initiative. Organisations that accurately collect, report on, and analyse data will be more successful than the organisations that continue to work in a reactive fashion.
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