As businesses push further toward total optimization, companies are rapidly turning to the power of data, using it to increase efficiency in everything from sales to human resources. While some internal departments, like marketing or sales, thrive off data and can easily use it to increase their output, the same isn’t the same for human resources, which doesn’t always have the easiest datasets to use for analysis.
Especially over the last two years, HR departments have taken on an obscene amount of work. From appeasing millions of employees around the globe during a shift to working from home to the looming recession calling into question department budgets, everything is falling on the heads of HR.
While HR has often been seen as a soft skill, with communication and management at the forefront of a human resource manager’s tool belt, this is starting to shift. With the mounting difficulties of this industry, with seeming crisis after crisis happening on a monthly basis, more people are turning to data to make their HR teams make those tough decisions.
Modern software integration has allowed for mass automation, with the continual generation of data being something that companies can analyze to produce useful insights. In this article, we’ll explore exactly how HR is changing, demonstrating how incorporating data has made data-driven HR the forefront of this entire department.
Let’s get right into it.
What is HR Analytics?
Within the world of HR, the vast majority of decision-making comes from a team that attempts to assess the pros and cons of certain decisions. The only problem with this is that HR typically lacks concrete data, making those decisions more instinct-based than based on reality.
HR analysis attempts to change that, increasing the amount of information available to HR workers by providing them with data-driven insights. Everything from the total time it takes to hire an employee to revenue per employee and even offer acceptance rate is tracked and handed to data scientists.
By collecting data, HR teams can then turn it into actionable insights to help them more effectively conduct their job. Especially in a time of crisis, where fast and accurate decision-making is vital, this is the perfect way of helping HR teams make intelligent business decisions. This is far from uncommon, with leading tech giants like Google, Facebook, and Twitter all collecting data continuously.
Benefits of Making Your HR Department Data-Driven
Combining data science with human resources seems like combining two completely opposed fields. However, on the contrary, they actually work well together, with the concrete reality of data providing a much-needed basis for communication-driven HR.
There are several benefits of making a HR department data-driven:
- Refine onboarding
- Employee turnover rate
- Increase performance
Let’s break these down further.
Refine the Onboarding Process
Using data like how long it takes to hire, the percentage of offers accepted, and how swift your employee onboard process all allow HR teams to understand their interview and hiring process to a greater degree.
Turning to data to outline these processes will help HR teams to more effectively break down their hiring process. Using publicly available data and comparing it to internally generated data helps HR teams to then plan for the future. Perhaps a company has a high applicant rate but a very low offer rate, this could point to an interview process that needs more work.
Alternatively, perhaps the company has a high offer rate but only a very low percentage of employees accepting their offer — this could point to the fact that the company needs to rework how they structure their offers and what they’re offering to potential employees.
Data provides ongoing insight which HR teams can use to shape their onboarding and hiring practices.
Understand Employee Turnover Rate
In large corporations, employees come and go every single day. While this is fairly normal, using data to analyze the actual rates of employee turnover can do wonders in helping HR teams to understand if they have a typical turnover rate or not.
What’s more, by using exit surveys to find out more about why employees are leaving, HR teams can then work backward to ensure their company finds solutions to these reasons. For example, if a high percentage of employees are citing a better job offer as their reason for leaving, then your company might be underpaying its staff.
By then analyzing the data around industry averages, you can then put your company’s own data into perspective. This can be a vital point of clarity, with this comparison allowing you to understand more about your employees, why they might be leaving, and how you can ensure they stay for longer and continue to provide value.
Increase Performance
Especially in our age of remote working, people have been introduced to vastly new ways of working which haven’t always been easy to adapt to. Companies that structure lots of meetings have had to adapt to online Zoom-Esque video calls, which not everyone has taken to well.
But, understanding exactly what employees find most difficult or distracting about their role allows HR teams to make plans to overcome them. For example, by sending out mass surveys to everyone in the company, with space of quantitative answers (numeric), HR teams are able to pinpoint what could be slowing down company progress.
For example, 60% of workers find meetings the single most distracting thing at work, often just seeing them as a waste of time that interrupts their day-to-day workflow. This information was gathered by HR teams after polling their workplace, with these results instantly revealing that if a company wants to increase its performance, it should find a way to decrease the need for meetings.
With this in mind, there has been a huge movement to asynchronous meetings, allowing people to get the information that they need without having to interrupt people’s days. By discovering problem areas that hinder productivity, analyzing the data, and coming up with creative solutions to overcome this, data-driven HR teams can rapidly increase workplace productivity.
Final Thoughts
There is a reason that most workers believe that integrating more technology, like data analysis, is a positive force for their company. Technology helps streamline work, taking abstract decision-making and turning it into something logical. In a field like HR, which directly deals with people on a 1–1 basis, a grounding in concrete reality is vital for effective decision-making.
Going beyond just making decisions using data, a data-driven HR department can streamline their workforce, optimizing the onboard process, facilitating high productivity for current workers, and even pinpointing the reason behind employee turnover. Armed with data, the modern age of HR workers can boost their own performance, making the navigation of this age of crisis significantly easier for everyone.
