People Analytics is the New Black

Over the past year or so, there has been increasing focus and chatter surrounding the use of data and how People Analytics can help us manage Talent and hire better. Is this a passing fad? Or is there more to it than just another buzzword?
According to research from Deloitte, this is a high priority area for 78 percent of large companies and more than 60 percent are preparing to build a plan this year. So it would seem we are onto something big here.
But what exactly is People Analytics? Many HR professionals and Talent Acquisition leaders would have heard of the term and perhaps have a general idea of what it is, but when put to the test most cannot explain the inner-workings of People Analytics. Can you?

What is People Analytics?

According to Kevin Wheeler, Talent Futurist and Founder of the Future of Talent Institute, there are two levels to People Analytics:

• The first level is the why – why do people do what they do? It is about using the data to understand people, their actions, and the motivations behind them.
• The second level is what  –  i.e. what will happen when we hire people who exhibit a certain characteristic? It refers to using data to predict what happens next base on our actions.

“The word insights is really the difference – typical reporting is just a bunch of numbers and it doesn’t mean much and nobody knows if that’s relevant or not,” said Kevin.
“The whole point of People Analytics is to give you some real insights into knowing what’s going on and to enable you to answer the why questions – why are people leaving, why aren’t people accepting your offers – so that you are able to look ahead and improve your processes,” he adds.

What is the impact on Talent Acquisition?

The generation and use of data in Talent Acquisition is not new. We have done both for many years, most notably through the pre-employment psychometric tests we conduct during the hiring process to assess our candidates.

But People Analytics offers something extra. It takes all the data that you’ve collected across these activities and turn it into actionable information. It will enable you to understand the sorts of things Kevin discussed. Why are people are not accepting your offers? Why are they dropping out of the process, and why do they do it when they do? When you have the tools to answer these kinds of questions, you have the tools to optimise your Talent Acquisition process.
Essentially, People Analytics takes the gut feeling out of the hiring process and enables Talent leaders to make decisions based on deep analysis of data, by presenting chunks of statistical analysis in a compressed, easily consumable size. This allows you to recognise the dynamics that are unfolding during the hiring journey and provides a platform to create a more cohesive experience for prospective employees.
Research from Harvard Business Review has shown that People Analytics can increase the ability for recruiters to find the best qualified candidates by more than 50 percent. Analytics have also shown the following benefits in HR:

• Attrition rates decreased by 35 percent
• Performance increased by 20 percent
• Revenue per employee improved by four percent

Which goes a long way to allaying fears that data analysis is all theoretical, and doesn’t have a concrete business impact. Concerns about the efficacy of dedicated People Analytics teams has been around for a while, but the results speak for themselves and it might be worth dedicating resources to a permanent team, if you can.

Where do you start?

So now you’re convinced (hopefully), and want to jump on the People Analytics bandwagon, if you haven’t already. But how? Don’t get overwhelmed! Take into account your size, your means, and your goal and then decide how far you want to get.
If you want a clear idea of how to progress, Sam Hill’s article is an excellent start, but if you’re in a hurry, here’s a summary:

1. If you can only afford one person, he or she is your People Analytics Leader, and this is not an entry-level gig. This person should be reporting to the CHRO or CEO, because what he or she has to say could reshape how you approach things in your business;
2. If you can afford a team, they report to your People Analytics Leader, and they need to be skilled in three key areas: data foundations, data interpretation, and data communication;
3. Decide how success is measured for your business. What’s the base-line without a People Analytics function, and what do you want to see improved once you implement one? Don’t be afraid to rework this as time goes by. Maybe the reason you’re not seeing much ROI from your People Analytics team is because you’re measuring the wrong things. As it happens, you have this shiny new analytics team to help you with that.

Now it’s over to you.

Want to learn more about turning your People Analytics plan into a game changer? Listen to this podcast from Kevin Wheeler for a sneak peek on what you can expect at the upcoming People Analytics & the Future of Knowledge conference in Sydney on 17-18 Oct!