People Analytics: Unlocking the Potential of Your Workforce

If you want to get more out of your workforce, people analytics is the key!

A challenge often faced by HR is to forecast potential threats to the business, with some certainty of the outcomes the business is likely to face, so that strategies can be put in place to combat them.  People analytics massively helps HR to produce more evidence-based solutions, which is why it has become popular to utilise within organisations in recent years.

People Analytics Priorities | Source: Visier
People Analytics Priorities | Source: Visier

With the huge amounts of data that HR departments have access to, people analytics at a basic level can be used to boost engagement, motivation and morale amongst the workforce.  However, research suggests that organisations are still shying away from the more advanced capabilities that people analytics can offer; but why is that?

The current state of people analytics

Fundamental uses of people analytics is what continues to dominate today, which are areas like performance, well-being, productivity and retention; This is in part due to the data being fairly simple to collate and study, especially with the current types of HR software that can handle and analyse big data.

78% of large companies rated people analytics as “urgent” or “important”. Only 7% rate their organizations as having “strong” HR data analytics capabilities!

Even though people analytics has gained considerable traction within organisations, as it advances into predictive analysis, where you can guess future trends using robust data, specialist systems and capability and even further into prescriptive analysis, where you apply mathematical and computational sciences to ‘prescribe’ solutions and ideas at a strategic level, implementation rates drop.  This is apparently due to organisations not having the required skill set, confidence or specialised software to tackle it properly.

According to a recent report, profit margins of companies with advanced people analytics function are up to 56% higher than their less advanced counterparts.

 Ways that people analytics can benefit your organisation are as follows:

To identify and retain top talent

An organisation which is suffering from high turnover of top talent can use people analytics to foresee issues and tailor their incentives in a timely manner to curb attrition. By better measuring the causes of turnover, planning can be put in place to keep top talent within the company.

HR Pros Turn To Analytics To Attract, Retain Top Talent | Source: Forbes
HR Pros Turn To Analytics To Attract, Retain Top Talent | Source: Forbes

To manage underperformance of departments and identify causing factors

When a department is under performing, whether that be by not meeting targets, expectations or deadlines, there are ways to identify what is causing the problem.

People analytics can help to answer if there a correlation between skill-sets and issues, current caseloads and deadlines or management training and engagement.  Multidimensional people analytics can help to link underperformance to a possible root cause and develop a better plan to address the problem.

To enhance employee morale

Instead of absorbing the costs of losing employees, organisations can mitigate against the impact low morale has on the organisation by measuring the happiness and well-being of their employees and putting a strategy in place to improve it!

To ensure HR objectives align with organisational goals

Design evidence-based interventions to help HR objectives align with business goals.  For instance, if the organisation wants to reduce turnover by 50% that occurs within the first 6 months of employment, they can gather relevant data to identify causes for resignation or termination and design retention strategies that have been proven effective to keep employees on board.

To support the performance management process

Having more evidence based data to hand will make it easier for management to bring up performance issues with staff, reducing the sensitivity and bias that might be associated if no data was present.  By addressing issues properly with a clear plan of how to best support the employee going forward, will in turn see an improvement.

Good performance will also be identified quicker, enabling management to recognise and reward staff in a timely manner which is linked to employee engagement, morale and retention.

To support a culture of data-based decision making

An organisation that develops a data-based or evidence-based culture is in the practice of making organisational decisions that incorporates the use of facts, professional expertise and ethical judgement.

Evidence-Based Management | Source:
Evidence-Based Management | Source:

All key decision makers have real-time performance data at their fingertips every day and are usually following these four practices:

  1. They have established one undisputed source of performance data;
  2. They give decision makers at all levels near-real-time feedback;
  3. They consciously articulate their business rules and regularly update them in response to facts;
  4. And they provide high-quality coaching to employees who make decisions on a regular basis.

What is the next evolution of people analytics?

There are endless possibilities and outcomes when using people analytics, especially if in collaboration with innovative technology, such as AI, automated machines and blockchains.

For example in recruitment, from the collation of big data we are able to accelerate the process in identifying whose skills are the closest match to the person spec and job description with automation tools.  From those results, AI can further shortlist applications without bias when explicitly designed that way (this is an important point)!

“Next-generation performance management technologies already enable integration with data from areas like sales, marketing, or customer management. Machine learning and artificial intelligence can help turn this data into actionable insights around promotions, compensation, development opportunities, and career moves.” 

Josh Bersin, Merging Performance Management and People Analytics

Another development (although not a new science at all), Organisational Network Analysis (ONA) in people analytics is something popping up a lot in recent articles by HR leaders, due to new developments in technology, different ways of working and changes in business requirements allowing it to overcome the hurdle of scaling and going mainstream.

ONA provides a different way to view how communications, information and decisions flow through an organisation, that may otherwise have been invisible.  Org charts are no longer confined to being formal or lacking insight and continue to move away from the traditional hierarchy model.

Informed insight equates to informed decisions and that can be achieved with people analytics

With this new approach to visualising networks within the organisation, fresh insights are identified that unlock innovation, productivity and boost the employee experience to align with current trends.

“By looking at every employee’s network, its uniqueness, isolation and amount of overlap, ONA helps organisations find those employees who are key to managing critical internal and external networks and where succession planning effort should actually be directed.” Greg Newman, People Analytics Storyteller @ TrustSphere

The growth of ONA is believed to be the ‘most exciting’ development in people analytics, and is one of the top analytical techniques that the people analytics leaders want to learn more about.

Organisational Network Analysis is the technique that HR & People Analytics leaders most want to learn more about | Source: Insight222
Organisational Network Analysis is the technique that HR & People Analytics leaders most want to learn more about | Source: Insight222

This is definitely something we will keep an eye on!

So as you can see, people analytics is a great tool for your organisation to implement.  But to unlock the full potential of your workforce, you really should consider advancing the level of people analytics used within your organisation, taking it to the next level by developing skills, capabilities and HR software to better support the function and break free from traditional hierarchy models to truly see amazing results! 

Considerations to make

Some risks of that have been highlighted by HR leaders, and rightly so, relate to data privacy and GDPR, especially if you have access to passive data – “data gathered without the involvement of the data provider. The participant (data provider) may not even know that the data is being captured.”

Differences between active and passive data collection | Source: Lab1
Differences between active and passive data collection | Source: Lab1

With the introduction of GDPR last May, having access to all of this employee data requires a well-thought out approach as to how to ensure the data remains protected, used and stored securely.

HR need to be wary of what data they are going to collect and analyse, and communicate that clearly with employees ahead of time, stating what the data will be used for, what purpose it will serve and the benefits of the analysis to help mitigate any breaches of the regulation.

Let us know how you use advanced people analytics within your organisation – we’d love to hear from you!


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Written By

Julianna Gordimova

Never stop learning. Customer champion @CakeHR