HR Analytics Is Here! Are HR Practitioners Ready to Adopt this New Trend and Take Their Businesses to the Next Level?

Bamburi Cement PLC Safaricom Foundation , Kenya Power Kenya Pipeline Company , SASINI PLC , MOGAS Britam , East African Breweries PLC (EABL) 英美烟草 , Abyssinia Group of Industries , Dangote Industries Limited , SIMBA CEMENT , Kenya Airways , KCB BANK UGANDA , Uganda Breweries Limited , Uganda Revenue Authority (URA) , Rwanda Revenue Authority , Zambia Revenue Authority (ZRA) , Tanzania Revenue Authority (TRA). Lafarge Canada , Lafarge Egypt , BOTSWANA POWER CORPORATION , Botswana Unified Revenue Service , Absa Group , Cellulant , Pesapal , Illovo Sugar Africa , Allianz , Quickmart Supermarket , Eco bank 花旗 Dave Ulrich Zambeef Products PLC (ZAM) , Gardaworld security G4S Secure Solutions India Pvt Ltd , d.light Econet Wireless Zimbabwe Flutterwave Interswitch Group Kenya Ports Authority Geothermal Development Company , KenGen Kenya , Debeers Canada Acacia Maden ??letmeleri A.?. Serengeti Breweries Limited Serengeti Energy KRA(KENYA REVENUE AUTHORITY) , BURN Ramco Group , Yara International , Syngenta Access Bank Plc United States International University - Africa Equity Bank Limited , Britam , Safal Steel M-KOPA Tiko , Brookside Dairy , Kenya Wine Agencies Limited - KWAL 喜力 Zimbabwe Revenue Authority (ZIMRA) Official Mr Price Group , US Pharmacopeia Pwani Oil Group 可口可乐公司

HR Analytics Is Here! Are HR Practitioners Ready to Adopt this New Trend and Take Their Businesses to the Next Level?

What is HR Analytics?

“HR analytics is a methodology for creating insights on how investments in human capital assets contribute to the success of four principal outcomes: (a) generating revenue, (b) minimizing expenses, (c) mitigating risks, and (d) executing strategic plans. This is done by applying statistical methods to integrated HR, talent management, financial, and operational data,”?- Mick Collins , Global Vice President and Chief Expert, BTP, Qualtrics and People Analytics GTM at PSHQ - SAP SuccessFactors

HR analytics is a methodology for creating insights on how investments in human capital assets contribute to the success of four principal outcomes: (a) generating revenue, (b) minimizing expenses, (c) mitigating risks, and (d) executing strategic plans. This is done by applying statistical methods to integrated HR, talent management, financial, and operational data.

“HR will not be replaced by data analytics, but HR who do not use data and analytics will be replaced by those who do”. – Nadeem Khan

“Measuring the impact of HR on bottom-line business performance is the holy grail of HR Analytics “. – Edward Lawler & John Boudreau .

How does HR Analytics Drive Business Value?

1. Improved Talent Acquisition: By analyzing recruitment data, HR can identify the most effective hiring channels, reduce time-to-fill, and enhance the overall quality of new hires.

2. Enhanced Employee Engagement: People analytics can help HR leaders understand the factors that contribute to employee satisfaction and motivation, enabling them to develop targeted initiatives that improve engagement and productivity.

3. Streamlined Learning and Development: Data-driven insights can help HR teams identify skill gaps and training needs, ensuring that employees receive the right support to grow and thrive in their roles.

4. Effective Performance Management: By leveraging data, HR professionals can establish objective performance metrics, identify high-potential employees, and provide personalized feedback and development opportunities.

5B. Increased Retention and Reduced Turnover: People analytics can help HR pinpoint the root causes of employee attrition, allowing them to implement targeted strategies to retain top talent and reduce turnover costs.

The infographic below by AIHR | Academy to Innovate HR summarizes the benefits organizations can reap from implementing HR Analytics

Barriers to HR Analytics Adoption

Despite the potential benefits of HR Analytics, many organizations face obstacles in adopting and implementing data-driven HR Initiatives:

1.?????? Data Silos and Integration Challenges

·???????? Lack of data integration and sharing among different departments: The Silo mentalities within organizations prevent HR-related data being combined with data on other determinants of productivity and performance, so it is often hard to build analytical models that examine the role of HR-related factors while controlling for other relevant factors. As a result, there may be insufficient data to be able to ’ask the right questions’ (i.e., to use HR Analytics in an optimal way).

·???????? Insufficient data and metrics: Indeed, the lack of existing data items has been identified as one of the major barriers for succeeding in implementing analytics, above all in small and medium enterprises. Similarly, Lawler III et al. (2004) found that HR managers are aware that their HR metrics fall short of what is needed to address most key business decisions. In their own words:” there is a felt need” of HR metrics.

2.?????? Software & Technology

·???????? Limited resources and budget constraints: Organizations may face budget constraints or limited resources that make it challenging to invest in people analytics tools and initiatives.

1.?????? Lack of Data Literacy and Analytics

·???????? Lack of data literacy and Analytical skills: One of the primary challenges organizations face when implementing HR analytics is a lack of data literacy and analytical skills among HR professionals, The lack of analytic acumen or skills among HR professionals was documented as the second biggest obstacle to achieve better use of data, metrics and analytics (HBR, 2014). Indeed, HR executives recognize not feeling ’very confident’ about HR’s actual ability to transform and move them forward via key capabilities like analytics and AI.

Jonathan Ferrar , & David Green ???? in their book “Excellence in People Analytics: How to Use Workforce Data to Create Business Value” (2021) have identified ‘Six Skills for Success’ and have clustered them into six groups. Firstly, what they call ’business acumen’, which refers to topics such as financial literacy, political astuteness, internal awareness and external awareness. Secondly, those related to an ’consulting’, which covers a set of principles, techniques such as problem definition, hypothesis building, project management, change management, and stakeholder management. Thirdly, those competencies related to ‘human resources’, namely; HR subfunction, HR interdependence, privacy and ethics, and HR sixth sense. Fourthly, those competencies that refer to ‘work psychology’ with topics such as industrial psychology, organizational psychology, research & design analysis. Fifthly, ‘data science’ which refers to quantitative mathematics and statistics, computer science and programming, and data awareness. Sixthly, competencies related to ‘communications’ with topics such as storytelling, visualization, writing, presenting and marketing. The development of these skills, competences and knowledge may allow people to achieve a high level of technology and quantitative self-efficacy.

However, it is unlikely that any one HR professional possesses all of the skills needed to design and implement an effective workforce analytics system

1.?????? Management

·???????? Keeping HR Analytics only within the HR department

·???????? Underestimate the impact of culture

·???????? Focus on interesting problems instead of business problems?

2.?????? ?Privacy and Ethical Concerns:

·???????? The use of people analytics raises concerns about employee privacy and other stakeholders who are hesitant to embrace data-driven decision-making.

3.?????? Resistance to Change

·???????? Organizations may encounter resistance to change from HR professionals and other stakeholders who are hesitant to embrace data-driven decision-making.

Is your organization being held back by the above-mentioned barriers? People Edge Consulting Ltd. have partnered with LYTIQS to enable you to build an integrated workforce data for real time insights and tailored blueprints to boost productivity, performance and profits. With LYTIQS you can make faster, more confident strategic decisions. Our software empowers managers alike, enabling HR and Finance teams to collaborate on workforce planning, talent forecasting, engagement, retention and human capital value with access to expert consultants and data analysts for added support. ?

Would you like more information on this service? Feel free to access the same using the link below:

https://peopleedgeconsulting.co.ke/service/hr-analytics-and-metrics-consultancy-services-in-kenya

Some books and articles for reference on the HR Analytics:

1. Strategic Analytics: Advancing Strategy Execution and Organizational Effectiveness by Alec Levenson
2. The Power of People: Learn How Successful Organizations Use Workforce Analytics to Improve : Business Performance by Nigel Guenole, PhD , Jonathan Ferrar & Sheri Feinzig
3. Data- Driven HR: How to Use Analytics and Metrics to Drive Performance by Bernard Marr
4. Excellence in People Analytics: How to Use Workforce Data to Create Business Value by Jonathan Ferrar & David Green ????
5. Introducing HR Analytics with Machine Learning: Empowering Practitioners: Empowering Practitioner, Psychologists and Organizations By Christophe Rosset & Austin Hagerty
6. The best HR & People Analytics articles of June 2024: By David Green ????