People Analytics - Future of HR

We live in a rapidly changing world. Today’s trends might be yesterday’s trends tomorrow. With certainty, I can say that people analytics is on a rise and is represented in the future of HR. But what is people analytics?

“People analytics is the collection and application of talent data to improve critical talent and business outcomes.” - Gartner

Being from the millennial generation, I am part of the first generation to grow up with the internet, also known as a digital native. I grew up with understanding the importance of technology and data and how it can improve our lives. But how it actually can influence the work environment, I realized throughout my Masters in Talent Development and Human Resources at IE Business School. Throughout our Digital HR courses, I deepened my understanding of how important technology has become but more importantly how data is inevitable within HR and will gain even more importance in the future.

From Descriptive to Prescriptive

Advancements in technology, AI and changes in employees needs make the role of HR more important than ever. One trend identified is the changing role from a “descriptive and diagnostic” role to a more “prescriptive and predictive role”, making it more critical for effective decision making in the future, not just related to HR decisions but also to business-critical decisions. I believe that the role of people analytics will gain more and more importance and businesses will notice, that this is the way for identifying employees needs, predict need for roles and skills and assessing performance more impactful than ever. Nevertheless, people analytics is often still at its basics in companies, meaning that the teams are small, and the full potential of people analytics often cannot be leveraged. Companies seem to misinterpret people analytics as HR reporting and metrics which covers mainly the obvious and critical people related data within the company, whereas people analytics is much broader driving strategic insights and influence an organization by addressing future trends and decisions. Prescriptive and predictive, rather than descriptive and diagnostic.

Trust & Transparency

An important step in integrating people analytics successfully inside a company, is gaining the trust of employees. It is crucial for companies to be transparent towards employees, getting their approval for using their data and showing them what impact their data can make. Having the trust of employees is important and maintaining it isn’t always easy, as trust takes long to be built but can be destroyed within seconds. Therefore, as mentioned, it is important to be clear about the depth you as a company intend to invest in people analytics and to show employees which data you are using and for what. In fact, I believe that the aspect of trust and transparency can be a deciding factor whether people analytics fails or succeeds within a company. Therefore, it is recommended to have a thorough and clear data confidentiality agreement which ensures exactly this to employees: trust and transparency.

Analysing and understanding the Data

A crucial part of people analytics is analysing the data correctly. If data is analysed incorrectly, it can lead to misinterpretation and potentially wrong decisions. For this companies have data scientists. Data scientists know how to manage the data, how to analyse, build a model with it and work with it. Downside here, is that their analysis is often very technical and mathematical making it hard for people who are not familiar with the data to understand. Therefore, it is always recommended to have a translator, someone who is able to communicate the results and potential challenges from the analysis to the business areas and vice versa.

Decision-Making

As mentioned before, people analytics can be a great help in making business critical decisions. It cannot just help you improve your company strategy and help you identify your employees needs but it can help you retain employees, improve workforce planning, identify skills and role needs and so much more. People analytics will provide you with the data evidence to support your decision-making and by doing that help you improve several business-critical aspects, such as revenue growth or efficiency.

In conclusion, people analytics is here to stay and should stay. By leveraging it correctly, it can be powerful and can improve business performance. If trust and transparency is provided by the company, it will be visible soon that employees will be willing to support the company with their personal data. As a matter of fact, it can be considered as the future of HR, which is already here, and it is here to stay. ?

Thank you for reading, happy to hear your thoughts! ?