People Analytics

What is People Analytics

Data is now driving this world. Each time we click on a link on a website, search for something on google, upload a video/ picture on Twitter or Facebook, or instruct Siri or Alexa to play a song, we are generating lots of data. However, this data is not organized. To make sense of these segregated, unsorted and unstructured data you need to use analytics tools, knowledge, and technologies. Analytics could be used inside organizations to understand the people, their behavior, their expectations, and aspirations.

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People analytics (PA) is a process of data analysis where it uses HR data of an organization to understand, plan and optimize operations related to the people of that organization. The main focus area is the data produced by the human resources in an organization in its day-to-day activities. The final result could be used to prepare short and long-term plans to improve processes, optimize operations, redefine budgets, etc. that involve the Human Resources of the organization. 

People Analytics is also known as HR Analytics, Workforce Analytics, etc., and other analytics processes, people analytics embraces different analytics tools like Tableau, Power BI, Google Data Studio, etc. along with Statistics, Machine Learning, Data Science for forecasting and predictions.

Focus area of People Analytics

What sort of HR data is used? In fact, all kinds are available, from hiring data to employee satisfaction. People analytics takes data from the recruitment process and onboarding follows up, considers employee engagement, people and team development, consumes team skill gap analysis, employee satisfaction, exit interviews, and whatnot.

This data could be used to design and develop workforce analytics, talent sourcing analytics, hiring analytics, onboarding and engagement analytics, attrition and retention analytics, performance analytics and wellness and health & safety analytics, etc. All these analytics are very important for HR to understand people’s lives, well-being, and performance inside teams as well as skill and talent requirements inside the organization and can plan short and long-term strategies for hiring, retaining, and developing talents.

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Organizations get the benefit from PA

Analytics could always be used to improve process bottlenecks, planning efficiency, and effectiveness, cost optimization, and overall organizational outcome. Apart from the mentioned aspects, as People Analytics focuses solely on people, who are the core of any organization, and related processes it helps improve the overall organization performance very effectively.

Source, talent acquisition, and hiring

PA could be used to identify the best sources from where you can get the most and best resources for recruitment. Help to understand organizations’ skill gaps and indicate related best sources to get resources for the organization. Improves the hiring process by identifying bottlenecks, and conversion rates at different stages of the process, and reorganizing the process as an outcome of data-driven decision-making. Find out which new hires have a high probability to become a high-flier and move them to a retention program.

Employee retention, training, and development

Employee retention could be very much related to the individual development process, talent development plan, work-life balance, engagement, and satisfaction of employees within the organization. People Analytics could help us to draw the relationship among people, process, engagement,  satisfaction, etc. which could lead the organization to a better retention policy. It can also support defining optimized training requirements both at individual and team levels and as a byproduct can deliver employee learning assessment results. 

Diversity

Diversity planning could be a highly focused area of PA. To improve the diversity proportion in an organization, data from hire-to-day activities could be analyzed to determine which teams should be focused on improving diversity as well as achieving the goals of that team.

HR BP and Team

HR business partners who are closely attached to the teams could use PA to identify team strengths and improvement areas and plan HR budget allocation on teams to support that improvement process. Also, they can take full advantage of predictive models to identify future churn rates and keep improving the retention rate. They can also use PA to identify mapping among workforce-skill-task and plan the workforce in a more optimized way.

Performance analysis

Nowadays, KPI or OKR-based performance measurement systems are very popular and use that data to identify the ROI of each employee and identify underperforming employees and plan for their development.

Attrition

Attrition is another key factor in an organization and understanding the reasons why people want to leave or stay is very critical in long-term HR strategy.  PA supports identifying company attrition rate and overall factors that are leading to minimizing the attrition rate of an organization.

Data Sources

Different data sources could be used to enable HR analytics or people analytics. Following are a few data sources 

  • Talent sourcing data
  • Talent acquisition data
  • Individual and Team profile data
  • Employee engagement data
  • Diversity information
  • Health and safety occurrences
  • Employee performance data

This data could be managed by either a single or a multiple software ‚Äď hardware architecture model. However, the owner of the data is definitely different teams of HRM, but still could be managed by the centralized data team or IT team.

Skill Sets required for People Analytics

Major skill set required for PA includes

  • Understanding of Human Resources management
  • Talent sourcing, acquisition, and hiring processes
  • Employee development, retention, attrition
  • Employee performance management
  • Human Resources laws and regulations etc.
  • Understanding how processes work in the organization
  • Prior analysis and analytics knowledge
  • Basic to intermediate knowledge of programming languages
  • Visualization and presentation skills
  • Data Science skills, including machine learning

It would not be possible to achieve these skill sets by an individual, rather organizations can team up their employees which should include HR professionals, Software Developer, Data Analysts, and Data Scientists.

Tools used for People Analytics

Data analysts and data scientists have their own tools of choice. However, for HR Analytics we can solely rely on their data tools, or we can bring them more ease by introducing tools that are specialized in HR analytics. Here are a few examples of very popular People analytics tools in 2022, without any order.

As data is leading our world, we can expect analytics to be an integral part of any job description in the future. In the same way, HR and People analytics are in sync with these phenomena. People analytics is already a very important part of HRM, and it is expected that it will grow more and more in the future and will become most relevant for organizations that are willing to make decisions based on data. Organization growth in the future will rely not only on business and tech people but also on HR professionals who will ensure how efficiently and comfortably the growth could be achieved, and People Analytics will be one of the major keys for them to achieve that.

References and Sources:

  1. https://www.mckinsey.com/solutions/orgsolutions/overview/people-analytics
  2. https://www.mckinsey.com/business-functions/people-and-organizational-performance/our-insights/people-analytics-reveals-three-things-hr-may-be-getting-wrong
  3. https://www.youtube.com/watch?v=BWAkOYUaMuQ
  4. https://www.aihr.com/blog/people-analytics/
  5. https://www.gartner.com/en/human-resources/glossary/people-analytics
  6. https://humanpanel.com/the-business-value-and-benefits-of-people-analytics-examples/
  7. https://www.picked.ai/magazine/what-are-the-benefits-of-using-hr-analytics-a-guide/
  8. https://www.selectsoftwarereviews.com/buyer-guide/analytics-tools
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Lucas Mattar

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