Six Reasons People Analytics for Small Business Is Worth the Investment

Editor’s note: Despite their size, small businesses have much to gain from leveraging the insights from people analytics. We wanted to share with our readers how small businesses could benefit from people analytics so we asked our partner who knows and understands the needs of small businesses better than most—Justworks. This is a guest article from them. 

People analytics is often thought of as an enterprise solution for big organizations. Generally, large businesses need robust tools to understand data across large teams, budgets, and goals, while small companies have leaner teams and fewer people. Is diving into workforce data really that critical for little organizations? Does the investment in people analytics for small business make sense?

The answer is a huge, resounding yes! 

At Justworks, we know small businesses— they're the people we build our products for and support every day. We know that people analytics software can help small businesses (SMBs) in myriad ways and can be an incredible value add for founders, owners, and HR teams-of-one. Data and analytics can help businesses of any size answer crucial questions and make key decisions. Having an easy-to-use tool is vital, particularly for a small, scrappy team that may not have an analytics function on staff. 

Here, let's bust the myth that people analytics is only for the big guys. We'll dive into some of the key ways people analytics for small businesses can save owners time and money, and share some important questions to help you understand whether it's time to add people analytics to your tech stack. 

Three ways people analytics for small business saves time

Time is something many small business owners struggle to manage as they often wear several hats, juggling multiple functions at once. Learning how to be a data analyst shouldn't be another time-sink. Fortunately, intuitive people analytics removes this obstacle and reduces the time SMBs need to invest in understanding how their workforce impacts business operations.

1. Focus more time on core business needs. 

According to findings from Justworks and The Harris Poll, 87% of small business owners agree that having better tools to manage administrative aspects of their business would allow them more time to focus on their core business. Getting the right data and insights allows you to move faster and spend your time where it's most impactful. 

2. Remove the need for data-parsing expertise.

People analytics helps small business owners become more data-driven without learning the ins and outs of data analysis. You can see the right questions and the answers to them all in one tool—there's no need to download a spreadsheet and sift through column after column. People analytics software enables you to drill into the data in real-time, helping you make decisions right away.

3. Generate instant data visualizations to accompany people data insights.

Another way people analytics can save SMBs time is by providing data visualizations. Seeing insights displayed as charts and graphs is a powerful way to help users understand insights and trends, particularly when presenting to investors or the C-suite. Creating visuals from scratch can take hours—time that could be better spent on other tasks—but with Visier data visualizations are generated instantly to accompany insights. 

Three ways people analytics for small business saves money

In addition to saving time, people analytics can also help improve the all-important bottom line. While it may seem counterintuitive to think that bringing on another tool will save money, there are some key ways people analytics makes economic sense. 

1. Reveal and address costly inefficiencies.

Having access to workforce data helps small business owners spot inefficiencies that may be eating into the budget. For instance, you can look at the health benefits you offer and see a clearer picture of how much you're spending on medical, dental, and vision plans for your team. You can look at compensation data and see how resources and budgets are allocated across departments. You can look at historical data to understand past trends in order to plan for the future. Whatever metrics consider, you may find an opportunity to cut costs.

2. Enable self-serve access to critical insights. 

People analytics saves SMBs money by democratizing insights. You don't need to be an analyst to use people analytics, so anyone on the team can tap into it—meaning you also save yourself the cost of having to hire a data analyst. On small teams, pulling data is often left up to someone who isn't an expert, and may not know the right questions to ask. Even “if you don’t know what you don’t know,” people analytics provides both the questions and the answers so your business doesn’t risk suffering because of a comprehension gap.

3. Access built-in analytics ready to provide insights. 

Lastly, when it comes to budget, people analytics might not be as expensive as you think. You may be able to add this functionality bundled into another tool. For example, Justworks PEO customers have access to people analytics capabilities built into the product, so you get multiple tools for one price.

Is it time to invest in people analytics for small businesses? Three considerations

Clearly, there are plenty of ways that people analytics can provide tremendous value for small businesses. But, as with many tools, it comes down to timing. Is your business at a stage where investing in people analytics will provide maximum value and show positive ROI? Consider whether these questions have come up for you:

• Benefits

How can I optimize my company’s medical, dental, and vision benefits resource allocation? Or, how can I improve PTO policies to meet my employees’ needs within my company’s budget?

If you offer benefits to your team, like medical, dental, and vision insurance or PTO, it's important to have a clear picture of usage and spend. For small business owners who are unclear about benefits, people analytics can help.

• Workforce trends

What factors contribute to employee turnover at my business? Or, do we need to improve employee engagement?

As your business scales and your team grows, attracting and retaining the best people becomes a bigger priority. People analytics gives you crucial insights about your team that can help you eliminate blind spots, address issues before they become critical, and take steps to build a strong company culture.

• Finances

How can I allocate my financial resources most effectively to help my organization meet our strategic goals?

Budget is always top-of-mind for small businesses, and with added complexity comes a greater need for more detailed insights. People analytics can give you and your team a clearer view into company spending so you can make informed financial decisions.

If these questions keep you up at night, it's probably time for you to explore people analytics for your small business. You'll be able to save money, save time, and create operational efficiency that helps you make key decisions smarter and faster. For an all-in-one option that gives you People analytics plus the payroll, HR tools, and access to benefits of a PEO, check out how Justworks can help.