Rajiv is CEO of Complygate which is an award winning HR Tech Startup, which helps SMEs and Tier 2 Sponsors comply with the Immigration Laws.
Data is the new currency for the future. It holds answers and solutions to various organizational problems. But it is very messy and unorganized, and drawing conclusions from a lot of data can be very challenging. However, there is no need or time to organize one's organizational data before starting to perform analytics, and accuracy always takes precedence over perfection in this regard.
Improving workforce productivity, hiring the right employees and saving costs are some of the regular challenging goals that HR leaders face in an organization. Tackling these matters takes considerable planning, energy and strategy. After all, human dynamics is a grey area that only the most experienced of managers can claim to understand fully. Also, different decisions are important in different settings. In this context, organizations should assess and improvise when each factor — accuracy or data organization — is to be given precedence. For example, while deciding appraisals for your staff, you need to have clean data.
People analytics stand for fact-based decision-making in all organizational processes and don't rely on one-dimensional metrics, which do not capture the big picture and ultimately fall short of identifying true resolutions for organizational problems. For example, one-dimensional metrics, like employee data for a particular year, just comply with that particular aspect and cannot answer conclusively as to why employees are leaving or joining the organization en masse, or why absenteeism is rampant.
The Necessity Of People Analytics
There has been a steadily growing demand for better people decisions everywhere due to the constant changes in the business environment. Those who are given the responsibility of making people-centric decisions need to interrogate the data to find the root causes of any particular trend or phenomenon and must base their research perspectives on hard facts.
This process lies at the heart of effective people analytics strategies. The influence of people analytics in everyday decision-making is undisputable. According to DDI, organizations employing people analytics in decision-making are more than three times more effective than their peers.
Isolated headcount metrics, which are common in HR, fail to provide strategic value to the business, like estimating critical factors required to meet business goals or the ones that affect periodical business revenues. By focusing instead on dynamic trends that matter to business, strategic HR leaders are spearheading organizational strategies alongside the other CxOs using data-driven insights.
The following points show how analytics drives value and makes a quantitative impact on organizations.
1. Retaining employees: Reducing employee turnover is one of the most effective applications of people analytics. Organizations can make better-informed decisions to that effect by focusing on a particular role or set of employees.
2. Achieving fair pay: Fair pay for all can be achieved by analyzing compensation practices. Organizations can employ people analytics to make an assessment of candidate offers and various counterintuitive factors to arrive at an agreeable and approximate value. These aspects allow hiring managers to instantly gauge various candidate attributes and empower them to make better decisions.
3. Hiring: Hiring and hiring trends can be improved by talent acquisition analytics, which help organizations identify attributes that can best gauge valuable employees. Organizations can also easily find out where to get their best candidates and how to optimize spending investment in recruiting activities. This information has been leveraged by many organizations to improve their hiring process by analyzing the time taken by hiring managers to assess and pinpoint a valuable candidate, showcasing efficiency as a critical factor in the process.
4. Learning and development: People analytics can help organizations optimize their training. Data on learning analytics connects and illustrates the impact of training on business outcomes. This enables organizations to save time by asking the right questions.
5. Increasing diversity: Diversity augments business prospects and organizational success. In this regard, analytics can explain the state of diversity throughout an organization and its functioning, its employee life cycle, as well as check bias within the organization, thereby identifying conflict areas and resolving problems.
6. Optimizing workforce planning: Organizations having access to people analytics data can use that data to analyze workforce trends, which can be used to understand the current state of the workforce and, thus, help the management make informed decisions on optimizing workforce allocation to meet business objectives.
7. Improving layers: People analytics enables organizations to optimize layers, thus helping reduce costs and improve revenue wherever possible. Companies are able to generate considerable revenue by using and repeating this strategy periodically.
8. Increasing productivity: Organizations can improve their productivity and efficiency by using people analytics. This is possible by setting target-times as goals when starting work on company activities and projects, called a productivity index.
These pointers elucidate that people analytics are not just restricted to finding and tagging interesting data and information to be poured over later by the HR managers. People analytics have become the business tools to quantify and fine-tune an organizational business strategy each step of its way. Its teams work on core business problems like sales growth, workforce efficiency, operational patterns and fraud detection. They also work on a senior level with the CxOs or the Board of Directors within an organization. Every part of a business operation is analyzed using available data to create forecasting models for business process optimization. This is how data is embedded in day-to-day decision making to derive and drive business results and values.
Beyond conventional business engagement, and at the core of organizational functioning, people analytics analyze the drivers of engagement within and outside the organization to create cultural and engagement models to provide multifaceted, valuable answers to the most basic question: What drives the workforce?
Read more from Forbes
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