Given the number of HRIS available today, there is more employee-related data collected than ever before. From payroll and performance to training and recruiting, the HR function is constantly swathed (some would say ‘sinking’) in a myriad of data.
However, despite being data-rich, HR is unable to pinpoint where their investments in human capital have paid off or where they are falling short. Human Resources can describe what’s happening within the organisation with standard reports and metrics but they tend to stall there, unable to move beyond the ‘why?’ or get to the ‘how?’ of their workforce.
Workforce Analytics presents itself at an opportune moment as HR looks for ways to be more strategic with managing the workforce. Aberdeen’s research shows that organizations using workforce analytics experienced a 14% year-over-year improvement in revenue per employee, compared to just 5% for those companies that do not.
The power of workforce analytics as a key driver to the success of the organisation is undeniable but what’s the first step to take? How do I move from workforce metrics to analytics?
For that, you will first need to understand the difference between metrics and analytics.
Metrics V. Analytics
Metrics provide information from one data source, for example, number of employees, total annual revenue and annual turnover rate. Metrics delivers stats from the past to guide your business operations but other than stating the numbers, it doesn’t go beyond that.
Analytics connect multiple data sources in one holistic view and they provide insights, trends and patterns so that you can execute the right strategy. Analytics not only show what happened historically and the present, it also predicts the future. You’ll be able to run queries and answers to questions like:
First Step Towards Workforce Analytics
Before you start thinking about gathering all the employee-related data you need, spend time thinking about the needs and goals vision of your organisation. What are the workforce issues your organisation is currently facing? Sit down with business leaders to discuss their needs and the organisational goals for the next quarter, or even the next year. What are the missing answers you need to help you achieve the business goals?
For instance, if the board wants to raise profits, think about the possible factors that will impporve profitability e.g. who your top sales people are. Could they be the ones driving profits? What are the key characteristics that define their performance? Do they all have an attractive compensation and benefit package? Are they first hires? How about training? Are they active on LinkedIn? How large are their networks?
Go beyond typical workforce questions about basic demographics, headcount, salaries and turnover rate. Instead, ask questions which will improve business outcomes and translate into actionable strategic decisions.
You can ask anything and everything under the sun but it’s important to note that there’s no one-size-fits-all template of questions. Each organisation is unique and driven by various factors such as employee demographics, industry type and business goals, so it’s crucial to define the right questions that will connect business objectives with desired outcomes.
This might seem counter-intuitive but with analytics, you will want to start with the end in mind. Defining the right questions for your organisation will determine the next step you take and that is accessing the data you need.
Ready to move on to the next step of the Workforce Analytics journey? Get the full step-by-step Workforce Analytics guide here.
Article contributed by HRBoss.
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