Hr Analytics

Predictive Analysis and Analytics can be summed up as a methodology for developing innovative insights by linking organization data and HR related data and applying statistical techniques with a goal to not just quantify but understand the story and identify the impact of investments in human capital on the business or organization.

Using talent data more effectively is a key for HR transformation. I strongly believe that Predictive Analysis and Analytics has created a momentum and shows a promising linear path with its impact. This technological advancement has already revolutionised marketing and finance and is now helping HR reinvent itself. The implications are dramatic because most HR related decisions have traditionally revolved around experience, human relationships and interactions rather than deep analysis. A data driven organization helps HR to transform from a reactive function to a proactive function, reinforcing its role as a strategic partner to a business. Predictive Analysis and Analytics is constructed not to make decisions but rather to arm people with much better information so that they can be capable of making decisions. Analytics provides the capability for organizations to leverage its most important asset, namely – human capital by understanding all the elements of its workforce. It thus gives the organization a distinctive competitive advantage that is hard to replicate.

Analytics helps answer critical questions such as why a certain sales employee outperforms his peers or why certain leaders succeed and others fail. Questions that directly or indirectly affect the productivity of employees and in turn the productivity of the organization. For example, Google which has been one of the pioneers to use analytics in all its people related decisions, published one of its findings in ‘Project Oxygen’. Project Oxygen was based on a hypothesis to test if people managers matter to employees at Google. The team at Google researched and analysed reams of internal data and determined that managers are indeed essential to employees and that the best managers had better performance and retention rates for their teams. They dug further into the data and conducted double blind interviews with their employees and determined that all the best managers were consistently exhibiting 8 attributes which the poor ones weren’t. They didn’t stop at the research phase but instead they extended it by coming up with ways in which existing managers can live up to these 8 attributes. Managers were rated by their subordinates on the 8 attributes and learning programs were implemented to help managers improve their capabilities in these dimensions. They even used them as a base when they were filling people manager roles. With the development initiatives rolled out after Project Oxygen, Google has seen an increase in the score of its people managers in all the 8 segments (attributes) over the years, from a cross section of their people managers in various departments and regions. Project Oxygen was incredibly successful for Google. The reason was not because Google came up with a new model of management (because these attributes are already established principles in management literature), but because Google translated the research that was internal to the company to something that was meaningful for each of these people managers which triumphed best practices.

Thus, Analytics in HR will have a deep and far reaching effect on HR challenges. It can improve HR functions by integrating workforce data and aligning talent investments with business results. HR can also use it to develop data driven insights to predict common problems that organizations face such as turnover, disengagement among employees, managing persistent under performers, building a leadership pipeline, and so on. It will ultimately lead to improvement of all areas of the business, covering a spectrum of areas that the HR function can impact positively. This will go a long way in transforming the role of the HR from an ‘order taker’ to a ‘key business contributor’.

Although many progressive companies have shifted to the data driven approach in HR, most of them face obstacles in effectively adopting the workforce