People are the backbone of any business. Everyone understands the critical importance of Human Resource departments and the role they play hiring good people — and keeping them, too.
But that kind of tried-andtrue back-office work isn’t the only thing HR can do. As data continues to drive more and more business decisions, HR is expected to do more than just manage the life cycle of the employees; HR should become an even stronger partner to the business strategy through data and analytics.
That’s because when data drives people decisions, it empowers HR departments to identify the people trends that have the potential to shape vital business outcomes and define company culture. Datadriven HR can provide unique insights into what trends the lines of business can expect, how companies can hire for the future, design high-performing teams, and get the most out of their talent.
The key is predictive data analytics.
HR data analytics hasn’t been around for very long and talk of “HR data analytics” or “people analytics” may have once seemed bizarre to some. But that was before revolutionary steps forward like data-driven marketing put data and data analytics on everybody’s map.
Today, HR may be one of the last business departments to fully implement and embrace data analytics —but it’s bound to become one of the most impactful.
That’s in large part due to the unique people challenges that employers are facing in the current business environment. The pandemic, for example, revealed just how powerful the people aspect of a business could be. Nearly every business today is struggling greatly with talent acquisition and retention because of pandemic-induced changes in both the personal and professional lifestyles of the workforce. The ‘Great Resignation’ continues to disrupt even the best-laid workforce plans of business leaders.
“Two of the biggest problems facing corporations today is that most business leaders don’t know why their talent is leaving, or how to retain them”
Two of the biggest problems facing corporations today is that most business leaders don’t know why their talent is leaving, or how to retain them. They may know some best practices from business seminars, articles they have read, or from their own past experience, but they don’t necessarily know specifically what is going on at their company or organization that is creating the turnover trends that are negatively impacting their businesses.
That’s where HR data analytics comes into play.
With the right HR data analytics tools, you can load performance information and start to collect a myriad of information, including but not limited to tenure, race, gender, and age of your high performers. You can then see the trends in things like turnover rate, thereby proactively identifying the co-factors leading to employee turnover. You can then begin targeted initiatives that address these factors.
All too often, the information business leaders need to make the right policy decisions to improve the workplace is siloed, fragmentary, or after it’s too late. HR data analytics can collect the relevant data, analyze trends, and deliver packaged, predictable, and actionable insights.
Of course, organizations must be prepared for potentially large investments in technology and training. Very basic HR data metrics can be done in Excel, but the most efficient, most effective, and most predictive HR data analytics will require using dedicated data analytics programs by a well-trained team.
But the rewards are worth it. Being able to systematically identify, quantify and act on the people drivers of business outcomes can make or break a company’s plans for successful growth.
At PenFed, we have an incredible HR team, dedicated to serving the employees who make PenFed great, so they in-turn can deliver the best-in-class experience for our members. With the power of data in their hands, I’ve seen the HR team do more for PenFed than has ever been done before. More business leaders should know and appreciate the right data analytics tools that can be at their disposal — and work to implement them. A short-term investment in data analytics will prove to be a long-term win for their people and their organization.