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HR Analytics and Applications

HR Analytics is a strategic discipline that integrates HR data with statistical techniques to enhance decision-making and optimize organizational performance. It has evolved from automation in HR processes to becoming a vital tool for aligning HR strategies with business objectives, enabling data-driven decisions in areas like recruitment, job design, and compensation management. By leveraging data insights, HR professionals can improve workforce management and contribute significantly to business success.

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12 views4 pages

HR Analytics and Applications

HR Analytics is a strategic discipline that integrates HR data with statistical techniques to enhance decision-making and optimize organizational performance. It has evolved from automation in HR processes to becoming a vital tool for aligning HR strategies with business objectives, enabling data-driven decisions in areas like recruitment, job design, and compensation management. By leveraging data insights, HR professionals can improve workforce management and contribute significantly to business success.

Uploaded by

Anisha E
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Introduction to HR Analytics and Its Applications

HR Analytics

HR analytics is a strategic and data-driven discipline that plays a crucial role in modern
organizations. It involves the integration of data derived from Human Resource (HR) practices
within the workplace with sophisticated statistical techniques. The primary goal is to facilitate
evidence-based decision-making, ultimately contributing to the overall improvement of the
business. Over time, there has been a growing recognition of the significance of human capital
in driving organizational success. This has led to increasing calls for HR departments to harness
the value of their workforce effectively. In response, HR Analytics has emerged as a strategic
imperative to fulfill this role. By leveraging data and analytics, HR professionals can unlock
valuable insights that drive smarter decision-making, align HR practices with business goals,
and optimize organizational performance. HR analytics serves as a powerful tool in guiding
HR professionals to make informed and logical connections between their practices and their
impact on the business. Through data analysis, HR practitioners can identify areas where HR
practices are adding tangible value to the organization. Additionally, they can pinpoint areas
that require optimization, leading to more efficient resource allocation and better outcomes.

The strategic use of HR analytics enables HR professionals to gain a comprehensive


understanding of workforce dynamics. By analyzing data on employee performance,
engagement, training, turnover, and other HR metrics, organizations can identify trends and
patterns that shed light on critical factors influencing the company's success.
Furthermore, HR Analytics enhances the ability of HR departments to align their strategies
with broader business objectives. By quantifying the impact of HR practices on key
performance indicators and business outcomes, HR professionals can showcase the strategic
value they bring to the organization. This, in turn, helps HR gain a seat at the table during
strategic decision-making discussions, fostering a more collaborative and impactful
relationship with other business functions.

HR Analytics is a powerful decision science that empowers HR professionals to make data-


driven decisions. By harnessing the potential of human capital and strategically leveraging data
from HR practices, organizations can unlock valuable insights, optimize workforce
management, and make substantial contributions to overall business improvement. Without a
robust HR analytics approach, HR departments may miss out on crucial opportunities to
enhance organizational performance and maintain a competitive edge in today's dynamic
business landscape.

A HR practice enabled by information technology that uses descriptive, visual, and statistical
analyses of data related to HR processes, human capital, organizational performance, and
external economic benchmarks to establish business impact and enable data driven decision
making. (Marler and Boudreau, 2017).
It is also defined as a method to analyze and predict outcomes of HR investments.

Evolution of HR Analytics

• During 1980s and 90s there is automation in HRM processes especially in payroll and
data administration which helped in identifying HR area for automation and reducing
administration cost.
• During 1990s to 99 there is increased adoption of computers in HRM and popularity
of HRIS which help in reduced administrative cost, avoiding duplication of data,
quick access to information.
• Early 2000s are characterised by internet accessibility, increase ICT which leads to
the emergence of HRM which helped in instant access to information, better decision-
making and linkage to business decisions and better planning.
• The year 2005 to 2010 is characterised by fast paced internet access and penetration
of ERP which helped in embracing decision-oriented HRM from traditional service
oriented HRM.
• The year 2010 onwards the HR analytics stage started which made the HR as a
business enabler and a strategic partner.
Applications of HR Analytics
HR analytics is the process of utilizing data to make well-informed business decisions. For
instance, in talent acquisition, identifying the best candidates can be challenging. However,
analytics helps determine the key qualities required for a position and sift through applications
to find the best matches. Moreover, it can reveal when certain factors have little impact on
employee success. For example, analyzing data may indicate that college grade point averages
are not strong indicators of future sales performance, allowing for a broader recruitment pool.
1. Job Design: In job design, data analytics empowers HR Managers to identify factors
that influence motivation and performance. For instance, during the pandemic, quick
surveys are utilized by companies to understand employees' needs and preferences for
remote work and returning to the workplace. Text analytics on free text comments
further provides valuable insights into employee sentiments without causing survey
fatigue.

2. Recruitment Analytics: Recruitment analytics draw from marketing science, utilizing


segmentation and statistical analysis to optimize candidate selection and reduce costs.
Programmatic advertisements target specific job-seeker segments, allowing recruiters
to test different ads for better conversion rates. Innovatively, companies like Nissan
recruit talent through unconventional channels, such as racing video games, expanding
the talent pool.

3. Learning and Development: In learning and development, data-driven adaptive


learning technology personalizes courses to suit individual learners' preferences,
making corporate training more effective and cost-efficient. Online learning platforms
like Danone Campus 2.0 offer self-paced development opportunities that integrate with
employees' everyday routines.

4. Compensation Management: Data analytics also plays a crucial role in compensation


management. Instead of relying on instinct, HR managers can make informed decisions
based on data. For example, they can compare employee compensation profiles,
incentive rates, and performance ratings with market standards, ensuring fair pay
practices.

5. Health and Safety: In health and safety, innovative technologies leverage data analytics
to enhance employee well-being. For instance, technologies track driver fatigue in
mining trucks, triggering alarms when necessary, while wrist bands and helmets
equipped with sensors deliver real-time safety alerts to workers and supervisors,
promoting safer work environments.

HR analytics revolutionizes decision-making by leveraging data to optimize various HR


functions, leading to better recruitment, personalized learning, fair compensation, and
improved employee well-being.

Reference
https://hbr.org/2020/10/tech-is-transforming-people-analytics-is-that-a-good-thing
Source: https://www.visier.com/blog/culture/compensation-people-analytics/

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