People analytics is eventually becoming a standard practice in organizations – the question is whether it will be led by HR or some other function.
There’s been a growing interest towards People Analytics for quite a while. An increasing amount of organizations are adopting more advanced approaches to their people-related decision making. The challenges can be complex and time-consuming. However the potential value for those who succeed can be very significant.
Current Trends in People Analytics
Some might argue that people analytics practice is nothing new. Techniques and theories have been around for a long. So, why has People Analytics gained such a big interest during recent years? At least the following trends can lend some insight:
- In most companies, the people related decisions have become business critical questions. The interest towards improving these decisions has expanded from HR department towards the agenda of business executives.
- The “datafication of HR”, enabled through the advancement of HRIS systems and other digital solutions, provides organizations with more accessible and detailed view of employees. Most potential is often achieved when people data is combined with other data sources- sales and marketing, or operations and finance. There’s an increasing pressure to deliver value from these data sources and organizations cannot afford to wait much longer.
- The topic of people analytics has been popularized by different examples reported in mass media around the possibilities of advanced analytics. These examples vary from optimizing sports teams decision making using 1,4 million data points. Further on, there’s an example of impacting election outcomes by using social media data and personality profiling. Inspired by these examples, many go back asking what are the possibilities to apply data and analytics in worklife context?
People Analytics- Priority or Not?
Based on my research in selected major Finnish organizations, there’s a clear divide between those who have clear goals and plans to advance with their people analytics capabilities, and those where people analytics capabilities don’t yet fit within HR’s priority list. It was quite common to find that the HR department was too busy firefighting with various administrative matters. Many were trying to fix the mess of incompatible HR systems. Some were even striving to get the basic operational reporting in timely order.
At the same time, the technological development is only increasing its phase. Start-ups and tech giants are investing billions in data-driven applications to enable some very imaginative solutions. These data-driven insights are applied in optimizing and automating workforce planning and scheduling, algorithmic management is already a reality, recruitment adds and content are optimized through machine learning. Job specific AI enabled applications have been created to help doctors, lawyers, auditing and teaching assistants.
People Analytics Future is Here and Where is HR?
Future is already here and things that were perceived as science fiction only a few years ago are reality today. The question is no longer about what we can possibly do today, but what we can do today that just a while ago would have been perceived as impossible to achieve. In this digital disruption, however, the biggest challenges organizations face are not technological, but rather people related and behavioral challenges. With this change in our hands, HR has the potential to have a very significant role reshaping the practices related to work life and on how work gets done.
Getting ahead with People Analytics requires sense of direction and proactivity from HR. Very few executive board members fully understand the potential of people analytics and they don’t necessarily turn to HR when faced with advanced analytics related topics. Some experts have pessimistically predicted that the responsibility to conduct advanced people analytics will be moved out of HR and become part of existing end-to-end business analytics, where human resources are just one element in the broader picture.
So, if HR is unable to tap into this opportunity for one reason or another, it is likely that sooner or later some other department will take over the responsibility. In many cases the problem HR is facing is whether it is capable of being part of defining its own future, or will it simply continue reacting to the changes that happen in the world and organizations around them.