Technology has transformed the way companies do business externally and the way they operate internally. In today’s digital age, the use of analytics is allowing companies to better measure how they attract, retain and grow their talent to stay ahead of the competition. Human resources (HR) professionals are now also interpreting analytics to provide strategic counsel to the company. Leaders to help ensure business goals are met.
Beyond the traditional ways of recruiting and measuring talent, HR teams are leveraging analytics to determine where further investments need to be made, and how to fill gaps in hiring delays and employee turnover.
A recent Inc./HRCI survey focused on exploring the role of HR in fast-growing companies asked respondents to rank the importance of various business functions within their companies. It’s no coincidence that HR ranks second to sales as one of the most important business functions, while 79 percent of those surveyed believe HR plays a critical strategic role in the company. The use of analytics in HR is therefore integral to the department’s success. analytics enable companies to closely scrutinize and provide a roadmap for HR professionals to assess what’s working versus what needs rapid improvement to advance the company's.
“Cutting-edge analytics is a powerful tool that helps ensure companies find, retain and get the most out of their workforce, but it is only one-half of the equation,” advises Amy Dufrane, SPHR and CEO of HR Certification Institute. “For analytics to truly have an impact, a company needs certified human resource professionals who can work with leadership to interpret the data and develop strategies to get the best out of their workforce and maximize employee engagement.”
When respondents to the Inc./HRCI survey were asked to name the three most critical talent management functions or needs in organizations for HR, they chose leadership development, career and succession management, and employee monitoring and reviews as their top three answers. Each of these functions (and many other HR functions) can be improved through the use of HR technologies that arm HR professionals with the data and insights that allow them to do their jobs more effectively and intelligently.
The Role of Talent Management Systems & Functions
More HR departments are using talent management systems to help evaluate job candidates and move targeted employees into the interview and hiring process of the organization. In order to give HR departments and senior management more visibility into employees, companies such as Ultimate Software use human capital management (HCM) systems to show turnover by location, role, department or even manager, providing a key tool for HR managers to more effectively work with management to develop better recruitment and employee experience strategies.
Best-in-class HR should be using insights from HCM solutions to help develop employees and assess performance at any given time, not just during annual performance review. HR teams seek out tools such as these to provide data-driven recommendations on how to align employee goals with company objectives and enable managers to garner better analysis for succession planning. By forecasting flight risk, HR professionals and managers can undertake the critical conversations and effective steps to avoid employee turnover.
Forward-thinking HR teams are investing significantly in data analytics with more than 80 percent of enterprises and 63 percent midsize businesses already using or planning to use data projects in the next year. HR professionals with the skillset to interpret critical analytics on talent, are able to provide companies with better candidates, improved employee engagement, stronger collaboratio, and improved decision-making.
Data Assessments for Skill Sets
Another area of key focus for HR analytics is performing data assessments to understand a prospective employee’s skill set and how Julie A. Juvera, PHR, Vice President of People and Field Operations for California Pizza Kitchen, advocates the use of data and personality assessments to “understand where employee’s strengths and opportunities lie in order to plot a course for development," she says. uch assessments, allow the teams to provide managers with a critical understanding of how employees will best fit in terms of future company needs. They will also garner future insight about matching the company’s work culture with the right employees and skills to speak future innovation.
Finding employees who best exemplify a company’s culture is the key to success for both the company and the employee, which is why innovative HR departments are also rethinking the standard, one-on-one interview. They are lending support to flexible interview processes that include casual interviews over coffee or lunch. Additionally, companies are leveraging team interviews and behavioral-based interviews to better understand who is an ideal fit.
Employee Engagement Surveys & Exit Interviews to Understand Turnover
With more than 22 percent of workers expecting to change jobs in 2017, HR departments rely on analytics to closely monitor employee retention and turnover for their companies. The cost of employee turnover has been said to range anywhere from tens of thousands of dollars up to almost twice the annual salary of the employee. Additional considerations surrounding employee turnover include loss of productivity, onboarding a replacement employee, training costs and the cultural impact of having to answer “why” the employee left.
With large-scale turnover affecting a company’s employment brand, employers should have “well-built systems and processes to get employee feedback.” Wendy Harkness, Esq., SPHR, advises. Another avenue for consideration is to conduct “stay interviews” which focuses company efforts on “finding out why your happiest and most productive employees stay with the company.”
As the Inc./HRCI survey suggests, good HR drives company growth. According to Dufrane, “analytics helps trained HR professionals and management find, evaluate and retain the talent that not only provides results, but ensures the company’s culture is strengthened.” Still, she advises, “while data assessment and skillset measurement is crucial, at the end of the day it all comes down to people.” More important than having the right software is having the right HR team that to evaluate data and data needs. It is people who transform data points into actionable insights that drive retention, growth and forward-thinking strategies for success.