All you need to know about HR data analytics 

HR data analytics and people analytics are often used interchangeably, but they represent distinct approaches to understanding your workforce. While both involve analysing data, their focus and objectives differ significantly. 

HR data analytics focuses on metrics related to processes like recruitment and training. People analytics analyses data to understand employee well-being, satisfaction, and engagement.  

Understanding the difference between the two is crucial. Let's take a closer look... 

Focus: HR data analytics concentrates on HR processes itself. It analyses metrics related to recruitment, training, and performance management, improving these functions. 

Scope: People analytics takes a broader perspective, going beyond HR data. By incorporating information from other departments, it allows you to understand employee experience.  

Aim: HR data analytics aims to improve HR efficiency and effectiveness. People analytics strives to enhance the entire employee experience, improving retention and productivity. 

1. Descriptive Analytics 

This level focuses on collecting and summarising existing data. It provides a historical picture of your workforce, analysing past trends to inform future decisions. Think of it as the "what" of your workforce data. 

2. Diagnostic Analytics 

Here, HR can delve deeper to answer specific questions or solve problems identified in descriptive analytics. Data collected focuses on a particular issue, such as high turnover rates or low training effectiveness. This helps pinpoint the "why" behind workforce trends. 

3. Predictive Analytics 

This level moves beyond the past, leveraging data to forecast future possibilities. It can answer questions like "what will be our employee retention rate next year?" or predict general trends in engagement or satisfaction. Predictive analytics helps you anticipate challenges and opportunities. 

4. Prescriptive Analytics 

The most advanced level goes beyond prediction to recommend specific actions. By analysing various scenarios with statistical modelling, prescriptive analytics suggests the best course of action to achieve desired outcomes or prevent problems. This is the "how" of data-driven decision making in HR. 

1. Reduced costs and saved time  

HR data identifies process inefficiencies and optimises workflows. It can highlight areas for cost savings, such as reducing unnecessary recruitment spending. 

2. Improved recruitment and retention 

By analysing hiring data, HR can identify what attracts and retains top talent. This valuable data helps to refine recruitment strategies. The data may also help to predict future flight risks, creating targeted interventions to retain high performers. 

3. Enhanced employee performance  

Analysing performance data helps pinpoint skill gaps and areas for improvement. HR then use this data to design targeted training programs and development opportunities. This in turn helps to boost the employee performance. 

4. Personalised training programs  

HR data analytics allows for a more individualised approach to training. Understanding an employee's strengths and weaknesses allows HR to create a personalised training plan suited to their needs. 

5. Staying compliant 

HR data also helps ensure compliance with labor laws and regulations. With access to data on overtime and leave requests, HR can identify potential compliance risks. This then allows them to take proactive steps to mitigate these risks. 

HR data analytics isn't just theoretical. Let's look at some real-world scenarios to unlock the benefits discussed... 

Reduced costs and saved time 

A company analyses time-to-hire data and discovers their recruitment process is lengthy. By streamlining procedures and focusing on the most effective channels, they can significantly reduce recruitment costs and time. 

Improved recruitment and retention  

Analysing exit interview data reveals a common reason for employee turnover is a lack of career development opportunities. The company implements new training programs based on this data, leading to higher employee retention. 

Enhanced employee performance  

Performance data shows a specific department consistently falls short of targets. HR dives deeper to identify a skills gap and creates a targeted training program to address it. This results in improved departmental performance and increased productivity. 

Personalised training programs 

Skills assessments and performance data pinpoint an employee's weaknesses in a certain area. HR creates a personalised training plan that helps the employee develop those specific skills. This leads to a more well-rounded and effective employee. 

Staying compliant 

HR analyses overtime data and notices a specific team is consistently working long hours. This could be a compliance risk. By investigating the cause, HR can take steps to ensure the team works within legal working hour limits. 

Why is an HR analytics strategy important? 

Focuses your efforts 

A strategy ensures you're collecting and analysing the right data to answer your most pressing HR questions. 

Aligns with business goal 

It connects your HR data analysis to broader organisational objectives. This ensures HR efforts contribute directly to business success. 

Prioritises resources 

By following these steps and considering the key factors, you can build a robust HR analytics strategy. This will help empower your HR team to make data-driven decisions, ultimately impacting your organisation's bottom line. 

HR data analytics goes beyond basic reporting. It uncovers hidden trends and patterns to drive better business outcomes. It offers a range of benefits, from reduced costs to improved recruitment and retention. AI presents exciting possibilities for the future of HR data analytics. AI can process massive datasets, offer more nuanced predictions, and automate repetitive tasks. However, you must carefully consider the potential challenges like bias, transparency and security. 

Building a winning HR analytics strategy is vital. Consider your skills and resource. Do your HR leaders have the time or skills necessary to analyse the data? Think about your current tools and technology. Are they appropriate for managing and analysing your HR data?  

By harnessing the power of HR data, HR can make more informed decisions. This helps to build a stronger, more engaged workforce, contributing to overall business success. 

Want to learn more about how PeopleXD can help get the best out of your HR data? Our team of HR experts are here to help.