Workforce Analytics: Three Fundamental HR Areas for Advanced Metrics
Companies using workforce analytics outperform those that do not. It is that simple. For organizations that want to achieve best-in-class status and maximize their performance and profitability, workforce analytics have become a "must have."
Equipped with powerful workforce metrics, HR leaders can clearly identify and communicate to the "powers that be," precisely where their company’s investment in human capital is paying off and, more importantly, where it’s falling short and why. Business leaders need people to do the work and they need HR to supply real-time accurate data to help them make smarter decisions about their workforce.
The obvious questions are, "What metrics should I be tracking?" and "Which key performance indicators will provide me and my organization with the greatest value?"
When getting started with workforce analytics, HR professionals must be clear on what the top driving initiatives are from a corporate perspective—what are the overall business objectives? HR must identify and measure those workforce metrics that are most impactful to your organization. High-performance companies track a wide range of metrics from basic human capital facts (headcount, cost-per-hire, etc.) to more sophisticated performance data (how workers are impacting actual business results). Whether your organization is just starting out with workforce analytics or using some form but looking to expand the maturity of your metrics, it is strongly recommended that you focus on three fundamental HR areas—Turnover, Recruiting and Employee Performance—before moving onto more advanced workforce metrics.
1. Turnover—Identify who is leaving the organization voluntarily and why. Use your findings to address performance or training gaps and improve your investment in human capital.
2. Recruiting—Identify the top talent common characteristic traits for each position in your organization—especially those that drive business performance—and map them to your internal and external recruiting strategies. Use the data to determine the types of skills and abilities that you need to actively recruit for both immediate and long-term success.
3. Performance—Identify who are the under-performers and why. Understand when and where productivity fluctuates and why. Align compensation and incentive programs with performance.
It wasn’t all that long ago that employers were forced to make human capital decisions without solutions designed exclusively for accessing, measuring, and reporting workforce analytics. Many leading organizations today still do not use a formal workforce analytics solution to help manage their HR metrics. Executives and HR professionals are seeking alternative ways to help their organizations answer and address critical workforce questions and be more proactive in their HR approach.
By implementing a complete, end-to-end workforce analytics solution, organizations can get an accurate birds-eye view of their workforce and use the data to guide them in fact-based human capital decisions and strategies.
In considering a workforce analytics solution, here are four key recommendations to apply:
1. Make sure it easily integrates HR data across all HR systems. Streamline reporting efforts for your HR professionals to extract, analyze, understand and report on large amounts of complex data from disparate HR systems. Eliminate the need to "piece together" workforce data housed in multiple, expensive and complex HR systems and provide a true and accurate representation of workforce insights to stakeholders and decision-makers—saving your organization both valuable time and money.
2. Look for solutions that help predict trends and outcomes.Using advanced clustering techniques empowers you to uncover hidden patterns of behavior or common characteristics, help predict future plans and outcomes and make better, more informed decisions—based on past and present data
3. Ensure it offers an intuitive user experience. Workforce analytics must actually be put to use to be of real value. A user-friendly and intuitive solution not only ensures higher adoption rates but it also reduces implementation and training costs, with a solution that is simple to use.
4. Look for a solution thatenables analytics to be reported easily and compellingly. As a true strategic partner in your organization, HR must share their data in a way that influences decision-makers into action (e.g., to recruit specific types of talent, to reduce headcount tactically, to develop certain individuals within the organization). Sharing findings in a collaborative, easy way with stakeholders can reduce costs, shorten decision times and achieve greater alignment.
As a growing body of industry research continues to highlight, workforce analytics tools—and the array of insights they provide—are essential to companies seeking to outperform their competitors and maximize their profitability. By integrating workforce analytics with business analytics, you will not only improve your human capital ROI but you will also increase the value that your workforce delivers to your organization’s performance. HR leaders have always understood that people are the most critical and important element to a company’s success. With workforce analytics, those leaders finally have the tools necessary to turn that knowledge into action.