INSTITUTE –University School of

Business
DEPARTMENT -Management
Program Name
Course Name: HR Analytics
MSC Name: Dr. Priyanka Sharma
Designation: Assistant Professor
Chandigarh University

UNIT-1 –
Significance and DISCOVER . LEARN . EMPOWER
benefits of HR
Analytics

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 Learning Objectives Significance and
Benefits of HR
CO Title Level
Analytics
Number
Will be covered in the
lecture
CO1 To understand the concepts and practical Remembe
relevance of HR analytics in an organizational set-
r
up.
Topics for Discussion
• Significance and Importance of HR Analytics

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Significance
• Improved Hiring Decisions
• Reduced Talent Scarcity
• Improved Hiring Process
• Good Training
• Better Employee Insights
• Reduced Attrition Rate
• Improved Candidate Experience
• More Productive Workforce
Benefits of HR Analytics

1. Practicing evidence-based HR
Traditionally, HR management was always based on trends, biases, or temporary fixes. There
will generally be inconsistencies between what HR professionals believe to be suitable and
effective and what data proves to be effective. Evidence-based HR centers on making
decisions supported by evidence from internal data, research findings and studies, expert
judgment, real-life experience, values, and concerns. This approach enables HR
professionals to base HR decisions on facts and evidence rather than relying solely on a gut
feeling.
One example of this is when PNC bank’s HR team used HR analytics to better understand the
risk of their incentive plans. This helped them better understand the nature of certain
roles. Then, they created a framework to mitigate that risk rather than scrapping their
bonus policies altogether.

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2. Improving recruitment and talent acquisition
HR manager gains valuable insights into hiring process by tracking data pertaining
to key recruitment metrics such as cost per hire, application completion rates,
quality of hire, quality of source, and candidate experience. This allows him to
see what’s working, what needs improvement, and make changes accordingly,
which will positively impact the business.
One of the biggest problems organizations face is finding the right people to fit
the right roles. What’s more, early attrition rates can cost a business significant
amounts of money. A staggering 66% of CFOs have confessed they have poor
cultural fit decisions when hiring for their organization. Therefore, it’s vital to
know who to hire to ensure optimum performance and productivity in your
business and reduce your turnover rates and recruitment spending.

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HR analytics can sift through all the information and skills in
new candidates’ applications, compare this with the skills
and behaviors of your current top performers, and make a
shortlist of the best potential candidates using algorithms.
For example, tailored situational judgement assessments
can ensure candidates have the right competencies to
thrive in a specific role. This saves your recruiters time and
your business money and increases your chances of making
the right hire the first time around.

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3. Managing employee performance and productivity
With HR analytics and key performance indicators (KPIs), HR manger can assess
the ROI of all employees. It helps you identify your top performers (and
use these as a benchmark when making new hires) and those who
are struggling (and offer them support). A better understanding
of motivation, productivity, and efficiency can help all employees improve their
performance and contribute to the bottom line.
Analytics can offer insight into interactions between employees and collaboration
between departments. It can also show you how employees interact with
certain applications and how this affects their productivity. Through this, you
can optimize internal processes and streamline employees’ workflows to boost
performance, collaboration, and productivity. For example, if an organization
can analyze the productivity levels of its remote workers, then it can use these
findings to shape its remote working policies accordingly.

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4. Helping build equitable compensation and benefits
packages

Analyzing compensation data allows HR managers to spot any

pay disparities and fix them to ensure they’re achieving
internal and external pay equity. It can also help them
determine which benefits are most valued by your
employees. Then, HR managers can adjust their
compensation and benefits packages accordingly. Plus, they
can decide if an additional bonus percentage leads to
improved retention or performance or whether it makes
no noticeable difference. That can ultimately save their
money.
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5. Enabling effective workforce planning

HR analytics also enables companies to remain ahead of the

game by forecasting and preparing for future workforce
demands. For example, predicting attrition rates helps
organizations improve their workforce planning, particularly
for critical roles within the business.

IBM used data on recruitment, tenure, performance,

role, salary, promotion history, and location to
reduce their turnover rates in critical roles by 25%
over four years.
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6. Boosting learning and development, upskilling and
reskilling

Data can show HR managers where their employees need upskilling or reskilling, if
they’re utilizing training opportunities, and if the training is relevant for them . This helps
HR managers create relevant learning and development programs that help
upskill and reskill their employees, boost performance, achieve organizational
goals, and save time and money.
For example, analytics can help HR managers understand which of your employees prefer on-
the-job learning and which prefer classroom learning. It can also show them which
employees are more likely to seek additional learning and what character traits they
possess.

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7. Preventing turnover

• Another of the benefits of HR analytics is that they can help you

understand:
• which employees are leaving and why,
• your retention rate,
• which departments have a higher than average turnover,
• early attrition rates for new hires,
• and which employees are most likely to leave in the future.
• This data enables organizations to prevent losses before they
happen, reduce their turnover rate by understanding the root cause,
and then design targeted strategies to improve retention.

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8. Saving money
Analytics can help an organization use its budget more effectively by
demonstrating the potential value of each dollar spent. Software can unite HR
and finance departments and offer one single source of truth, enabling both
teams to have a strong understanding of metrics, including ROI numbers and
salaries.
For example, suppose data shows you that one of your L&D programs is
helping employees perform better and boosting your bottom line.
In that case, it makes sense to invest in this program and cut
spending on any programs that aren’t delivering the same value.
Similarly, if one particular source continually brings you top-
performing candidates, it makes sense to allocate the majority of
your recruitment budget on that channel rather than ones bringing
in mediocre candidates.
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9. Preventing workplace misconduct

Another significant benefit of HR analytics software is the

data it collects from incident reports. This information can
help identify trends in misconduct such as workplace
harassment and bias. The data enables organizations to
make tactical plans to anticipate and combat these issues
and improve workplace conduct across the business.

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10. Allowing organizations to be proactive

Through continual insights, feedback, and analysis of results,

organizations can be proactive in their approach rather than
reactive. It helps them stay ahead and anticipate and prevent future
problems.
Comparing past and present data enables organizations to make
logical predictions, foresee the future needs of the business, and
prepare accordingly. That way, business can implement
scenario-based planning and prepare for multiple futures.

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Pool Question-1

Data Analysis is a process of

1. inspecting data
2. cleaning data
3. transforming data
4. All of Above

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 Blackboard
Assessment Pattern

Components HT-1 HT-2 Assignment Surprise Business GD Forum Attendance Scaled

Test Quiz Marks

Max. Marks 10 10 6 4 4 4 2 40

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References

Text & Reference Books

• Fitz-Enz, J. (2010). The New HR Analytic: Predicting the Economic Value of
Your Company’s Human Capital Investments
• Chakraborti, J; Tripathi,R; Khan,S.(2017). HR@Analytics: Leveraging the
power of Technology to Create Super Performers.
• Lance A Berger, Dorothy R Berger: Talent Management Hand Book, Mc.Graw
Hill
Web Link:
https://www.aihr.com/blog/benefits-of-hr-analytics/#List
Video Link:
https://www.youtube.com/watch?v=ZMU_18xrYQY&t=5s
THANK YOU