One of the key roles of a business manager or company executive is to hire and retain the right employees for the job at hand. Currently, talent management and human resources have been in the midst of a trend called people analytics. This trend has moved talent management and hiring decisions away from the more common experience-based decision-making toward more deep analysis, according to an article from McKinsey&Company.
To learn how to implement people analytics, it is vital to first understand exactly what it is and how to properly define it. Keep reading below to learn all about this new business trend.
What is People Analytics?
People analytics is essentially a form of more advanced analytics in which human resources departments and managers assess the data for better talent management and business decisions. Advanced analytics is used to significantly enhance ways that companies attract, develop, and retain excellent employees.
While many companies are still using instinct and general experiences to determine who to hire, people analytics can play a major role in helping managers use powerful data to find ways to hire and retain the right individuals. This type of data analytics can also help companies reduce bias based on managers’ preferences or social experiences while also improving performance for hiring decisions, according to McKinsey&Company.
There are a wide variety of benefits for companies that implement advanced analytics for hiring and retaining talent. Below are the most important benefits of people analytics for companies worldwide.
The Key Benefits of Advanced People Analytics
Some of the main advantages of utilizing advanced data analytics when hiring employees include:
- 1. Identifying drivers of high performance,
- 2. Streamlining recruiting and hiring,
- 3. Creating benchmarks for talent management.
Advanced analytics will help you determine the more complex factors that drive performance on a company-wide scale. This can be adopted by recruiters and managers to affect their practices and identify any employee performance gaps.
People analytics also helps with ensuring successful hiring decisions are made and that more effective processes are implemented for evaluating candidates in terms of relevant characteristics and qualities. This leads to a more diverse hiring protocol, a generally faster hiring process, and greater chance for success throughout the company.
Essentially, people analytics can be used to determine what factors influence employee retainment, which workers are more likely to be successful, the steps needed to create stronger leadership, and how to innovate across teams.
How a Healthcare Organization and the Nielsen Company Used People Analytics to their Advantage
Some examples of the benefits of people analytics comes from a healthcare organization that saved more than $100 million when utilizing these techniques while, at the same time, boosting workers’ engagement, reports the McKinsey&Company article. Predictive behavioral analytics was also used at one company to reduce its retention bonuses by $20 million. This company had discovered that limited training in management as well as miniscule recognition efforts had led to higher employee turnover rates.
Another example comes from the company Nielsen, according to a LinkedIn post. In 2015, this company was facing significant employee turnover. Piyush Mathur, who was head of the people analytics department at this company, was looking to include hard data to address this problem.
By developing a model to better understand the turnover rates and dive into their own employee pool, the company Nielsen was able to identify the drivers of turnover and work toward fixing the problem. Since then, the company has cut down on the turnover rate by almost half and saved millions of dollars as well.
Now that you can clearly see the advantages of implementing a people analytics program at your company, it is time to discuss the steps necessary to create this type of data analytics process.
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Tips for Developing an Employee-Centric Data Analytics Program at Your Company
Managers looking to develop an employee-centric data analytics program will need to adhere to the following steps:
- 1. Implement the right models.
- 2. Employ change management consultants.
- 3. Pay attention to smaller vendors in terms of analytics technology.
- 4. Work with a large group of professionals in order to succeed in this area.
- 5. Focus on analyzing new types of data and employing new types of data assessment processes.
- 6. Ensure strong data security features are in place.
When it comes to developing a people analytics program at your company, you will need to implement the right models, according to a LinkedIn article written by Global Industry Analyst Josh Bersin. Models can help managers see how to create stronger leadership, how much to pay the highest performing workers, or how to accurately predict employee retention.
However, more importantly, it is vital to appropriately implement the changes that these models find is imperative. As such, people analytics teams would benefit from working with superior change management consultants. For instance, one business had found that they were overpaying mid-level performers and underpaying high performers. However, due to company protocols, no changes had been made. It took several years for the human resources department to change its stances on raises.
In addition, another tip for succeeding in this data analytics sector is to be aware that the technology within this area is growing rapidly, but the smaller vendors are more likely to get bigger or get sold. “Don’t try to be all things to all people, when the market heats up you’ll be glad you own some part of this huge market,” Bersin explains in his post.
Another important part to remember is that a multitude of different professionals and job titles will be necessary to succeed within the people analytics department. While the data scientists and statisticians are responsible for making the models and analyzing the data, your company will also need consultants, processing specialists, psychologists, designers, and IT staff. All of these people will need to work together to create a successful people analytics strategy.
Another tip for successfully implementing an employee-centric data analytics program is to be prepared to analyze new types of data and develop new types of data assessment processes. The type of data found in the business world today includes email history data, worker engagement survey information, wearable devices data, and sociometric data.
Even the mobile devices including iPhones or tablets can impact the data that employers collect since these devices can store information such as GPS location and videos on video cameras. However, due to this type of data collection, data security and anonymity will become imperative at your organization.
According to Deloitte Insights, some companies are finding that the mere presence of data poses a security risk. For instance, the European Union has instituted regulations that require companies to immediately delete data elements when they are no longer relevant to a processing need.
Due to a multitude of data security and credit card breaches, companies and especially their legal departments have become more attuned to ways to ensure their stored data is as secure as possible from hackers. Those who work in human resources or on the people analytics teams will benefit from training classes related to data privacy, security, and protecting user identity. In addition, workers tend to worry about what this type of data will be used for. As such, having strong data security features in place will alleviate employee concerns.
Most importantly, it is important to remember that people analytics begins with appropriately measuring the performance among your team. Below we outline how you can properly measure team performance.
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How to Correctly Measure Team Performance
When it comes to measuring team performance, big data analytics should be used to address the major issues facing the company. Often, the problems surrounding the success of your organization relate to their impact on revenue, shareholder value, and market share.
When implementing a solution, it is vital to connect it back to these three factors. The general strategy involves building a clean data infrastructure and then using it to generate superior insights that advance your company.
In order to measure team performance using people analytics, you will need to observe key performance indicators or KPIs. For instance, if the company is looking to cut costs in terms of recruitment, the human resources department can have a target dollar amount for the KPI ‘recruitment cost in dollars.’
Another KPI to measure could be ‘innovative behavior.’ Using the annual engagement survey, managers could analyze behavioral scores to determine innovation and outline ways that the company could boost innovative behaviors.
If you want to improve your recruiting strategies and better measure team performance, the right time management software could make all the difference.
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Time Management Software Provides Superior Analytics Tools
The time management software Runrun.it can provide your company with time intelligence and a real time dashboard so that your team can get the best data assessments from your numbers.
Essentially, this time and project management product will help your employees stick to deadlines and complete work in a timely fashion due to its time tracking feature. All users need to do is click one button to have their work hours automatically tracked within this application.
In addition, Runrun.it has the dashboards and reports that you, as a manager, will need to properly assess performance metrics. For instance, if you’re looking to see how many revisions a specific team member’s project goes through, you can obtain these numbers through the Runrun.it dashboards.