Human Resource Analytics

What is meant by Human Resource Analytics?

Human Resources Analytics, frequently referred to as HR analytics, people analytics, or workforce analytics, is an important component in modern workforce management. It is the systematic collection, analysis, and reporting of HR data to use it for improving workforce performance and inform employee management-related decision-making.

HR analytics relies on the application of data analysis techniques to understand and improve human resource functions. This analytical approach enables organizations to validate their HR data against their pre-set business objective and offers deeper insights into their key metrics such as employee performance, turnover rates, and recruitment efficiency. In essence, HR analytics aims to convert a bulk of raw data about a series of workforce-related aspects into easy-to-understand executable insights.

What are the benefits of collecting and processing HR analytics?

One of the key advantages of utilizing HR analytics is that these figures or insights can be highly evidence-based and can guide the management’s decision-making. It is reported that organizations which proactively leverage their HR analytics experience significant gains in their productivity – say up to 25% and decreases in employee turnover rates of up to 50%.

Various HR Analytics Models Commonly Used Today

Based on their nature, purpose and aspects covered, HR analytics are usually grouped into four types.

• Descriptive Analytics: This type of HR analytics collects historical workforce management-related data to process them and figure out what has happened within the organization that has led to a certain consequence. For instance, fluctuations in the turnover rates and employee engagement levels.

• Diagnostic Analytics: This method seeks to explain why certain trends or patterns occur by analysing the relationships between different variables, such as employee satisfaction and productivity.

• Predictive Analytics: By utilizing historical data, predictive analytics forecasts future outcomes, such as which employees are likely to leave the organization. With such insights, the HR team can be involved proactively to address potential issues before they escalate.

• Prescriptive Analytics: Prescriptive analytics combines data analysis and algorithms to recommend strategies, predict outcomes and guide informed decision-making. Relying on specific input like scenario modelling, it identifies the most effective step forward.

• In today's fast-evolving workplace, strategically using HR analytics is crucial for staying ahead. HR analytics empowers organizations to improve their workforce management. By analyzing employee data, businesses can make informed decisions that contribute to maximum employee satisfaction and help achieve their organizational objectives.