HR analytics are playing a more important role in how companies measure the success of their human resources function. According to research published by the Society for Human Resource Management, 35% of companies that participated in a recent survey were actively developing their human resource analytics capabilities. However, just 9% of respondents in the same study felt that they had adequate HR talent in place. Why are companies embracing big data and workforce analytics? How can creating an HR insights engine help drive better performance, improve strategic planning, and increase your success in key areas such as recruiting and retention?
Here are four ways that companies are investing in their analytics capabilities and how it is positively impacting their bottom line:
Improve Your Recruiting Acumen
Recruiting is one of the most critical aspects of fueling your business growth. Without the right talent, it's difficult to build new products, serve customers, and ensure smooth business operations. HR analytics can help companies improve their recruiting efforts. Which sources lead to your most successful hires? Does key talent exist within the organization that should be promoted? Analytics can help you better understand your internal talent landscape. Predictive HR analytics are also being used to identify hidden talent sources and promising passive candidates.
Develop Better Insights on Employee Engagement and Satisfaction
Employee retention is a timely issue that employers need to consider. Too much turnover creates unnecessary disruptions to your business and replacing employees can be an expensive proposition. Companies are increasingly using analytics programs to help them measure employee engagement, and identify disengaged employees before they leave the company. With data-driven insights into employee satisfaction levels, companies can be proactive about retention and keep their best talent over the long-term.
Increase Your Ability to Deliver Excellent HR Service
With the vast number of HR tools available today, companies often assume that they're delivering excellent HR service. Yet many companies don't have a key grasp on what that means to their own employees. In some cases, employees want access to expert advisors around benefits or tools that speed up self-service on regular tasks such as submitting time and attendance. HR analytics help your human resources team to see which tools are most critical to your employees for maximum impact.
Lay the Foundation for Effective Human Capital Management
Rather than approaching human resources as a single activity, today's most successful HR departments are approaching the field as part an integrated initiative. An effective human capital management strategy relies on accurate data insights to help make strategic decisions. Technology – and the analytics that the right systems provide you access to – are an essential part of an effective, modern HCM strategy.
HR analytics help human resource managers to gain a high-level view on what's happening with their business. With this information, it's possible to make effective strategic decisions that support your key human capital management areas, from talent acquisition to employee retention. Companies that invest in gathering the right information have the foundation to make smarter decisions.