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Ideas and insights for today’s people-centered leaders.

According to Deloitte’s Human Capital Trends, 84% of leaders identify analytics as being very important to their organization, yet only 22% of organizations are making the investment. If analytics is the solution to improving the way we manage human resources and grow our business, why isn’t everyone adopting it? 

Many business leaders know people analytics can help organizations improve HR functions, but they don’t know that it contributes to their business goals overall. This makes perfect sense because, until recently, people analytics solutions were only available to enterprises. 

However, the perception that analytics are too complex and expensive is a barrier for mid-size organizations. This was a valid concern a few years ago when beginning a people analytics project was costly and time-consuming. In the past, people analytics have only been available to enterprises with big budgets. These organizations have the resources to build out HR analytics. As a result, it was rare to find a company with less than 5,000 employees investing in people analytics tools.

Now, analytics solutions are more accessible for growing organizations

While some still believe that businesses with a few hundred employees won’t have enough data to benefit from using people analytics, this isn’t the case. In fact, if you have an HRMS, you have enough data to get actionable answers from a people analytics technology.

Still, some organizations struggle to decide if they should use an analytics solution. This is because HR fears the data won’t be “right,” and bad decisions will be made with inaccurate information. However, the truth is that organizations are already making thousands of decisions–they simply don’t know that these decisions aren’t being made based on true analytics. 

Don’t HR management systems provide analytics? 

There’s a common misconception that HR reporting is the same as people analytics. Many digital HR tools contribute to this misconception by referring to their internal reporting tools as analytics, when in reality, they are HR reports. 

Your basic reports are run against the system where data was originally created, such as your HRMS, Learning Management System (LMS), or Accounts Payable system. These systems are transactional. They’re designed to help you perform certain tasks and keep records of those tasks.

“…if you have an HRMS, you have enough data to get actionable answers from a people analytics technology.”

These reports, whether they’re downloadable Excel spreadsheets or in visual graphs and charts, do display important HR data. Analytic solutions, however, connect data from different records, transform it, normalize it, and facilitate the exploration of data. Unlike transaction reports that simply display the data, analytics summarizes information and processes into metrics and measures to help you drive change

True people analytics are the “why” behind the data. Reporting is valuable, but understanding the context of your data and the behavior of your organization is what will empower you to put that data to good use. 

Benefits of people analytics

If you’re considering investing in people analytics for your organization, it’s important to understand the benefits you can expect. Here’s a look at some of the ways people analytics can impact your business. 

Making sense of data

The only way to get more accurate data is to start keeping track of it. Using a people analytics solution can help your organization do that. The idea here is that you should focus on progress, not perfection. If you don’t have any context for your people data today, imagine what you could achieve by increasing your understanding of that data by 50%. People analytics solutions allow you to take mountains of unusable data and turn them into something actionable. 

Business value

HR isn’t a revenue-producing function, but people analytics provide business value. Your HR data already exists and now you can make it work for you. Using people analytics, you’ll be able to better understand the health and success of your workforce, enabling you to improve strategies for hiring, retention, diversity, and growth. 

“Reporting is valuable, but understanding the context of your data and the behavior of your organization is what will empower you to put that data to good use.”

Better business decisions 

Today, decisions are made based on how leaders interpret data and a “gut feeling.” Now, people analytics will give organizations the opportunity to make better decisions. Having access to true analytics leads organizations to questions they would never previously ask. It allows you to understand the story of your people. 

How people analytics helps mid-size organizations

For smaller organizations with a few hundred employees, it’s tempting to assume that you won’t have enough data to generate a meaningful response from people analytics, but this couldn’t be further from the truth. People analytics can drive powerful change in your mid-size organization in the following ways:

Solving problems at a lower cost

Your people analytics platform will operate like your own in-house HR data analyst, at a much lower cost. Using complex equations, algorithms, and machine learning, analytics transform your raw data into something much more digestible: answers.

Consider the impact of focusing on one business question you’re struggling with. How would your organization and workforce improve if you were able to easily get answers, ask better questions, and gain a deeper understanding of your problem? 

“Having access to true analytics leads organizations to questions they would never previously ask. It allows you to understand the story of your people.”

Staying up to speed

If your organization doesn’t invest in people analytics, you’ll lose ground to your competition. As people analytics solutions become more accessible, organizations will have more information than ever before on their most valuable asset: people. This gives them the ability to make better decisions, faster. The earlier organizations start with people analytics, the better. 

Set up to scale 

People analytics solutions range in size and scope to meet the needs of organizations of all sizes. Solutions can start small. 

Whether you begin with a simple Excel spreadsheet or jump in with a people analytics solution that is sized for your organization’s goals, it’s important to take the first steps towards people analytics now. 

Then as your organization grows, your people analytics solution can grow with you.

Visier for Mid-Market takes enterprise-grade technology and puts it into the hands of all HR decision makers. With this solution, you’ll have unlimited access to the workforce and business information you need to drive growth. 

About the author: Zack Johnson

As GM, Embedded Analytics & Mid-Market, Zack Johnson is focused on building strategic partnerships with organizations that believe analytics unlocks critical, untapped value for their customers. Zack manages Visier’s OEM analytics business, where we partner with other software providers to bring world-class analytics to their customers. Prior to Visier, Zack was the co-founder and CEO of Syndio, a people analytics platform that helps business leaders make informed people management decisions around retention, engagement, and driving a more connected organization. Beyond Visier, Zack advises Grammy-nominated artist Mike Posner (Island Records) and regularly lectures on analytics and entrepreneurship at the Kellogg School of Management.

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