Great HR leaders excel at finding untapped potential in their people, increasing their efficiency, and maximizing their contribution to the company’s strategic objectives and financial performance. One area where CHROs are focusing on unlocking more value is within their HR analytics function.
Traditionally, HR analytics teams are seen as report-generators. Their contribution to company objectives has effectively been reduced to pulling numbers and using them to make graphs for the quarterly reports. While it may sound simple, many HR analytics teams are inundated with requests for reports and cannot keep up with demand. It leads to reactive HR strategies instead of proactive analysis.
Why Are HR Analysts So Busy?
The Pareto Principle, also known as the 80/20 rule, states that for many events, 80% of effects come from 20% of causes. An over-reliance on Excel spreadsheets, as well as inefficient analytics tools and processes, causes HR analysts to spend 80% of their time on average doing data cleansing, mapping, and validation, and only 20% doing actual analysis.
That 20%, however, is where all the value comes from.
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So while these reports provide important information, they are usually flat, with no drill-down capabilities. The time spent reporting on metrics also takes away from the deeper analyses into underlying trends, risks, and predictive models.
This is echoed by David Creelman, people management expert and CEO of Creelman Research, who said: “The reality is that most HR reporting teams don’t have the mandate, tools, or skill set to do analytics. Hoping that a team already up to their necks in producing routine reports can suddenly start doing sophisticated analytics, such as predicting turnover or using machine learning, is unrealistic.”
The misconceptions about the value of HR analysts are driven largely by how they are forced to spend their time and expertise. By shifting the expectations of the HR analyst role and making investments to greater enable them, CHROs can make their analyst team the core of their people strategy – instead of an afterthought.
Hiring More HR Analysts Isn’t The Answer
Since the only way to scale the manual reporting model is to hire more HR analysts, analyst teams are growing larger and more costly. The result is more reactive reports providing the same limited value.
One reason many companies are stuck in this internal supply and demand loop is because their current technology ecosystem requires several different tools for every step of the process from data cleansing to visualizations. These BI tools, which require expert users, are creating a data bottleneck in the organization.
Many organizations are now using a people strategy platform to democratize their people data and allow analysts to avoid the BI tools they previously needed to generate reports. And with a solution in place that provides a single source of truth for your people data, it becomes simple to automate the reports that analysts previously spent so much time on.
Easy access to the data has the added benefits of allowing reports in real time, instead of the static monthly reports that are old by the time they are completed. This proved important for BBVA Compass.
The financial organization used a workforce analytics solution to automate the collection and validation of their data, giving their analytics team more time to do high value analysis. This change led to faster hiring offers to key talent – a competitive advantage when candidates are considering opportunities from multiple employers.
With the right solution, HRBPs and other business leaders could also generate their own custom reports as well, dramatically reducing their dependence on analysts’ time.
What High Value Workforce Analysis Looks Like
What will you do with all your HR analysts once they’re freed from writing reports? If you want them to provide maximum value to the organization, then it’s time to harness their data savvy to tackle the questions that matter most to the business. Here are a few ways:
Think like your CEO
The most important data point to your CEO is the bottom line so the numbers that contribute to that total will definitely get their attention. The CEO’s attention is fleeting though. If the numbers you’re showing are esoteric (not relevant to the business outcomes that matter), then they may get buried in leaders’ inboxes.
Instead of HR’s traditional focus on optimizing operations and processes, get your analyst team working to uncover untapped potential in the workforce. One way to do that is to focus on revenue over cost-cutting.
How can you show ways to increase revenue per employee? Better yet, how can you drill into different lines of business, regions, and job functions and find those buried data treasures that will show business leaders how to get better results?
Important to this process is knowing your company’s key performance indicators and finding out how they relate to people decisions. Do this by asking yourself, “Is this urgent, or just interesting?”
Plant red flags
Instead of asking “What’s on fire today?,” your business leaders want to proactively manage risks and seek out blind spots. The best time to find out if there is a shortage of key roles is long before a factory fails to meet production or when an ER wait time has entered its fourth hour.
Is your recruitment pipeline full enough to meet your hiring plan? Your director of talent acquisition probably wants to know now if there will be a shortfall, not whenever the monthly report comes out.
With your analysts freed from generating reports, they can continuously probe for weak spots in the people infrastructure of the company, drilling down by region, line-of-business, or job function. By performing this kind of analysis regularly, your team can achieve HR analytics maturity much more quickly.
From Reactive to Proactive Analysis
By using the right technology to automate the majority of the data work, and allowing self-service access to basic reports and metrics, you can empower your HR analytics team to take a proactive role in your people strategy.
Instead of using your analysts’ valuable time to report on what happened in the past, give them access to a single source of data truth that will enable them to surface problems and unlock promising areas for investment early enough to make a difference.
As your HR reporting team transforms into an analytics center of excellence, so too will your HR function become an advisor and strategist within the business, as well as a steward of the organization’s most valuable resource – its people.