The big data and HR analytics is quickly making its way into the human resources, and companies are embracing it with open arms. It has been estimated that by the year 2018 approximately 6400 organizations with 100 staff will go for big data analytics, according to a 2013 SAS study, conducted on more than 1,200 businesses. The reason? Adoption of HR analytics is proven to give companies a competitive edge over their competition, by helping them unleash the power of Big Data.
The power of informed decision that HR and big data analytics provides is such that it’s hard for organizations to go for “gut-feeling” decision making for critical issues. In the long run, it may also prove costly to lag behind. That is why most companies nowadays are investing a large sum of their budgets into talent management software and a brigade of specialty staff including statisticians, data scientist and analysts. These specialists work in tandem with HR department to create defined analytics and metrics programs to escalate the organizational performance to manifolds.
So, how exactly does HR analytics helps the organizations?
We all know that any organization depends on its employees to thrive. It’s the HR department that directly deals with and takes care of every aspect of the staff. In a way, HRs also act as data collectors for the company by gathering and keeping records of employee information, hiring requirements, salary rates, attrition and so on. However, this highly valuable data often left scattered and unused in an absence of a proper HR analytics tool. This is when data analytics comes into the picture. An excellent HR analytics tool can use HR and big data analytics to interpret this unused data and magically turn into useful statistics and metrics, which later can be used to identify different trends and key areas. Once the patterns are identified, HRs can then decide a course of action based on that data.
Some of the other benefits of HR analytics include:
1. Better Hiring Decision
HR analytics helps in predictive analytics and enables HR professionals to make better choices based on the historical data. As per a 2013 CareerBuilder survey of 6000 HR professionals, around 27% of the organizations confessed that a bad hire costed them more than $50,000. An excellent HR analytic tool can help you collect a lot of data and look at it holistically to analyze who are the best candidates to hire and who are most likely to be successful leaders, along with the bad hires. For example, if you hired 30 candidates for a job and 5 candidates from a particular background failed at it, you might not want to recruit a new candidate from a similar background again.
HR analytics can help you prevent making big mistakes. It also allows recruiters to learn more about the potential hires through online resume databases, social media profiles, applications, records of employment, tests or contests, instead of only relying on plain old resumes and gut feeling. All this in combination helping you to find better quality hires.
2. Better insight
HR analytics also acts as a window to peek into employees’ professional life by tracking, sharing and analyzing its performance related data. This is the reason that many companies including top BPO’s and KPO’s keep records of the employee conversation and performance data to identify how they interact with their customers, co-workers and how they spend most of their time. The swarm of employee performance data then can be further utilized by hiring managers to identify the great talents. This data not just provides HRs more insight about the employee but also helps in charting out strategies to boost employee morale, retention, and overall engagement.
HR analytics also helps in identification and acknowledgement of top performers, along with the ones who are struggling in their positions, in order to gauge their training requirements.
3. Better training
A formal training program, albeit necessary, can also prove to be costly if not planned properly. The various professional development events conducted by companies for employee training, along with lunch-and-learns and seminars with industry leaders can consume a big part of the overall budget if not handled properly. As per State of the Industry survey conducted by ‘The Association for Talent Development’s (ATD)’, organizations spend $1208 on an average instead of employee training and development.
Keep in mind the effect and potential of training programs; it is highly suggested to make wise and measured investment decision by gathering data associated with a training program and its outcome.
HR analytics offer a 360-degree view of your training program initiative’s effectiveness. It also helps organizations identify if employees are leveraging on the opportunities being presented to them? Are they applying the knowledge and skills gained through these programs to their work? And so on.
4. Better retention
HR analytics can be a savior in an organization’s quest towards employee retention. It provides them with the opportunity to learn about the reasons as why employees leave and why they stay. In a case of a retention problem, organizations can look into a manager or team’s characteristics that’s making people quit. Whether compensation is the reason or it’s the way work is managed? It can also be used to identify the skills gaps and areas where employees are struggling due to the lack of training. HRs can make use of the various resources and tools like team assessments, employee satisfaction surveys, exit and stay interviews, and social media channels to predict (and thus, prevent) the cause of employee attrition and chart out better strategies to retain them.
Human resource professionals with good data interpretation skills are better able to identify the trends and by it can come up with a course of action to prevent it in the future.
The availability of HR analytic tools like – BDAS (Broadbean Analytics Suite) empowers the recruitment leaders to identify quickly & efficiently the top talent.
Today, HR analytics is critical to staying on top of the competition and those who are not taking steps to transition, risk being left behind. It is becoming the core part of the way organizations work today, and it’ll never go back.”
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