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5 Ways to Add Value Using Analytics in HR

5 Ways to Add Value Using Analytics in HR

There are multiple ways to look at Human Resources. Some think that we merely manage the workforce, from recruitment to exit interviews. Others think HR exists to reduce personnel costs as much as possible, working primarily for the business rather than the employees.

In reality, the real purpose of HR is to create value. Not just for the business, but for employees and for society at large.

Creating meaningful value can be difficult when you rely on just your gut feeling. Using People Analytics can help you tremendously in this endeavor. In this article, I will show you 5 ways on how you can add value using Analytics in HR.

 

Recruitment: Selecting new hires through gamification

Enhancing your recruitment function is an incredibly useful way to add immediate value to the company. Being able to hire quickly and bring in the talent required to grow the company is of paramount importance to the business.

For example, Nissan and PlayStation worked together to create the GT Academy, an alternative route into mainstream motorsport. The GT Academy provides Gran Turismo players the chance to compete against each other on the virtual tarmac. The players who proved to be the most successful were then asked to go from virtual to reality. This started a real-life professional racing career with Nissan for some of these talented individuals.

Creating new channels, such as how Nissan gamified parts of their recruitment channels, are a great way to bring new, talented employees to your company.

 

Engagement: Measuring employee engagement without breaking the bank

Employee engagement is often seen as the most important metric for people management, for several reasons. Tim Young, VP of Workday, writes “Employee engagement is paramount to attracting and retaining talent – and remaining competitive in the global market. Research shows a direct link between employee engagement and corporate performance”.

Measuring employee engagement can be difficult and costly, however. Measuring engagement yourself has a large risk. It can take a lot of time and you may design questions that don’t actually measure what you want to measure. Hiring external providers can help with this, but they are usually costly.

A way of measuring employee engagement without breaking the bank is to use pulse surveys. Pulse surveys are fast and frequent surveys designed to be done every week or every few weeks. They give continuous insights into the health of a company, hence the name ‘pulse’.

Using validated and short surveys that have as little as three questions can measure engagement reliably. Using these surveys allow you to gain valuable insights into the workforce without breaking the bank.

 

Learning & Development: Learning on-the-go

Learning & Development is an important part of the long-term strategy of any organization. With the rise of online learning, learning and development is becoming increasingly personalized. Through the use of HR Analytics, employers can see which skills their employees are lacking according to the needs of the business. Utilizing this data and combining this with adaptive learning technology, employees are able to receive personalized recommendations on courses, activities, and tests that suit their preference.

Expensive training courses that pull employees out of their jobs for days or even weeks are slowly phasing out. Individual, self-paced online learning is more cost-effective and increases learning retention. Employees can now choose when, and for how long, they wish to study.

Dow Chemical switched to eLearning for their regulatory compliance training of its 60,000 employees and contractors. Doing this, they cut the average spending costs per student from $95 to just $11. In total, this saved them $34m annually.

Utilizing the latest developments in learning & development, similar to Dow Chemical, can help your organization reach their long-term goals in a cost-effective manner. Analytics also offers the possibility to measure the impact of different training methods. If the cheaper training yields the same result, it’s a good choice!

 

Performance: Driving employee performance like Google

Driving performance has, and always will be, a key issue for the business. Many organizations have realized that conventional performance reviews are outdated. They don’t capture the full spectrum of an employee’s performance. Laszlo Block, former senior vice president of people operations at Google, wrote a book about his experiences at Google and how they drove performance.

Google uses peer reviewers for their performance reviews, which they hold multiple times per year. They abolished numerical ratings, so each Googler is now subjected to a five-point scale ranging from “needs improvement” to “superb”. Managers then decide on the final evaluation of an employee, assisting them in their development and long-term goals.

Google also continuously looks at the performance drivers of their employees. Over many years, Google measured employees’ traits and performance indicators. They then analyzed these characteristics and performed correlation and regression analyses on them. Certain characteristics, such as creativity, have been shown to drive performance. Understanding these characteristics helped Google to develop their employees and recruit the correct talent to drive performance.

HR Analytics can thus assist managers to track employee performance and spot & develop star performers accurately.

 

Strategic Workforce Planning: Staying ahead of the trend

The need for proactive workforce planning is indispensable. HR acting ad-hoc to company- and industry-wide challenges negatively impacts the bottom line of the company. By combining financial forecasts with headcount management and talent acquisitions, you can leverage HR data to improve workforce planning.

Pacific Gas & Electric Co, a California energy utility, is a great example of effective strategic workforce planning. They first designed the workforce planning process using the Human Capital Institute’s strategic workforce planning as a model. Then, they developed software around it that allowed business leaders to walk through a workforce forecasting process. This included segmenting their workforce based on how critical they are. It also included questions to help business leaders estimate workforce demand over the next five years.

For instance, it showed that certain critical software developers would be in high demand over the next few years, whereas a large portion of the current software developers would either retire or leave the company in the near future. Combining this data allowed the company to perform analytics, creating a database that showed how HR was prepared to tackle future trends.

After collecting this data, the HR team at Pacific Gas & Electric Co. developed a strategic workforce plan in collaboration with the business leaders. This helped them minimize their financial losses and stay ahead of future trends.

 

Utilizing Analytics in HR

Adding value to the business from an HR point of view can be difficult, but the use of HR Analytics can make this endeavor much more accessible. Relying on a gut instinct may have worked in the past, but today’s world is much more data-driven. Understanding and utilizing HR Analytics is therefore key to drive HR, and the business, forward.

The examples shown in this article only highlight a small portion of the vast amount of analytics that can be performed. All the activities that are traditionally seen as HR best practices can be improved using data! There are many more types of HR Analytics that you can perform within the business. It’s an exciting time to be in HR and I wish you the best of luck in your HR Analytics journey!

About the Author

Bastiaan Bastiaan Stokkel is the Curriculum Manager and Admissions Advisor for HR Analytics Academy. He has extensive experience in learning & development and is a data-savvy HR Expert who regularly writes about HR Analytics.

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