People Analytics. Friend or foe?

 

If you Google ‘People Analytics’, you’ll find the top of the search list is proliferated by paid ads. Then, below that, you won’t find a Wikipedia description, but what you will find is plenty of the big consultancies publishing articles on their websites on the matter, as well as some hard-hitting media. And that’s because it’s becoming an increasingly hot topic.

In a recent report by CIPD in association with Workday called ‘People Analytics: driving performance with people data’ they surveyed 3,852 business professionals globally – including HR and finance professionals – to understand attitudes towards people analytics and how it is being used in organisations.

The top line is that for businesses embracing people analytics, it’s translating to strong business outcomes. In fact, there’s a strong link to suggest that organisations with a strong people analytics culture are much more likely to report strong business performance (65% of those using peple analytics claimed this in comparison to their non-using competitors). And 75% of HR professionals globally who are using people data are using it to tackle workforce performance and productivity issues.

Access was clearly a facilitator, with almost three-quarters of respondents who said they were from a ‘strong-performance business’ said they have access to a dashboard of people data, compared to 50% of those in businesses of average performance.

That said, its take-up is still a bit hit and miss (so don’t feel bad if you’ve not cottoned on yet). Whilst 54% of global respondents stated that they had access to people data and analytics, only 52% of HR professionals stated that their organisation uses people data to tackle business problems.

And there are clear regional differences. The UK is lagging other markets in both capability and confidence. Just 21% of UK HR professionals are confident conducting advanced analytics compared to 46% of HR professionals in South-East Asia. What’s more only 40% of global respondents said that their HR team was able to tackle business issues using analytics data.

Edward Houghton, Human Capital and Governance adviser for the CIPD, said: “It’s hugely encouraging to see that the use of people analytics in organisations is leading to positive outcomes. The more access HR and non-HR professionals have to people data, the higher they rate their organisation’s performance. However, there are still clear challenges in terms of access to data and the confidence and capabilities in the HR function needed to get the best results from it, particularly in the UK.

“We need to see greater investment in the skills needed to understand people data and we need to encourage the use of people analytics across different functions in organisations, and in finance in particular. HR must lead the development of cultures that share a ‘common language’ when it comes to people data and a shared understanding and appreciation of the positive impact people data can have on business outcomes.”

Gonzalo Benedit, president, EMEA & APJ, Workday, said: “It is interesting to see that businesses exhibiting strong people analytics cultures achieve stronger business performance than those who don’t. Yet, data is only really useful when it used and understood across the business. At Workday, we’re seeing organisations shift towards the general trend of keeping their people data securely within their HR system. People analytics should be available in real-time, and on-demand so that that they can be quickly used to make effective decisions. While the business case for people analytics may be clear, the data must be accessible and used, as only then will businesses have the confidence to use it most effectively.”

The questions, now you know more, is what are you supposed to do about it? Whether you think it’s a friend or a foe right now, people analytics aren’t going away. Here’s some friendly advice from the CIPD and Workday:

  • Build people analytics skills and confidence into the profession: Low skills and low confidence have a clear impact on business outcomes. There needs to be greater investment in people analytics skills but HR professionals also need to build it into their daily decision-making in order to grow in confidence and capability.
  • Build strong, cross-functional relationships to improve the impact of people analytics: There are clear differences in the perspectives of HR and finance professionals, and other professionals using people data. Non-HR functions need encouragement to increase the use of people data in their decision-making and HR has a role to play in generating trusted, relevant people data to serve wider business needs.
  • Make better use of people data to understand business risks: People data can provide a unique way to understand value creation and risk within organisations.

 

Thursday, 14 June 2018

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People Analytics. Friend or foe?