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The Need of HR Analytics: How To Get Started

Oct 08, 2021


  • EDITORIAL TEAM Talent Management Institute
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The Need of HR Analytics: How To Get Started

You're an HR, and you are probably here to understand what we call HR Analytics. After multiple instances of hearing phrases like "what is workforce analytics?

How does talent analytics work?

What is the use of people analytics?"

You have finally decided to understand What is HR Analytics? Many HR professionals have become increasingly data-driven with their approach; in the post, we'll take you through the basics and the implementation of HR analytics to shape the future of businesses.

What is HR Analytics?

HR analytics is a data-driven technique for further improving decisions that impact HR functions, and HR analytics relies upon the quality of the data gathered from HR metrics.

Some Key HR metrics include time to hire, time to fill, training expense per employee, Application dropout rate, first-year turnover rate, top talent retention rate, average absenteeism rate, employee engagement & human capital risk. These are some of the most generic data points that are included in an organization's HR Analysis.

Human resource analytics is a relatively unique instrument, and it is mostly unexplored in the scientific literature. The most widely-known science-based HR analytics definition is provided by Heuvel & Bondarouk. Based on their definition, an HR analysis is the systematic identification and measurement of the human factors that drive business results. (Heuvel and Bondarouk, 2016).

In the last decade, Human Resource Management has transformed dramatically. It has moved from being an operational discipline to an increasingly strategic approach. The growing popularity associated with the phrase Strategic Human Resource Management illustrates this. The approach to HR analytics that is based on data is closely aligned with this trend.

With people analytics, you no longer have to rely on intuition for your decisions anymore. Analytics allows HR professionals to make informed decisions based on data. In addition, analytics can help evaluate the efficacy of HR policies as well as other actions.

The ability to utilize data to make decisions has become more crucial across the globe during the pandemic. In the post-pandemic era, it is evident that there are many changes taking place in the workplace - whether it's the rising popularity of hybrid working or increasing usage of technology. In the current era of disruption and uncertainty, it's crucial to make the right choices to make sense of the new world.

Getting Started With HR Analytics

To make informed and data-driven choices regarding their workforce, businesses should begin by developing the employee information strategy, which is in line with its strategy. This allows businesses to examine which aspects of talent they want to concentrate on (e.g., recruitment or upskilling employees retention, productivity, engagement). The insights gained from these areas will then guide decisions across every aspect of their talent-related organization.

After you've aligned your goals for talent and business, You can then work on the back to figure out what information should be gathered and how often it needs to be updated and where it needs to be stored, and who should be able to access it. For example, suppose the business wants to forecast the likelihood of employees leaving. In that case, it has to examine the leading and lagging indicators for employees over the last year (e.g., patterns in the behavior of employees, their sentiment leaves, feedback, training, performance, and supervisory information). This will enable the business to utilize downstream analytics to determine the most important indicators which will affect attrition.

The most important steps on the way to the implementation of HR Analytics:

1. Create the foundation

Before deciding on your employee-data strategy or implementing innovative technology, HR managers must know their workforce's dynamics and organizational goals. This can be accomplished through an assessment based on surveys to identify the skills preferences of employees and analyze the way you conduct your business, the habits, and attitudes to understand your team's and their culture better. By anticipating business requirements and challenges that are likely to arise, HR managers will be able to identify what kinds of data they'll collect ahead and think comprehensively about the storage, collection, and retrieval techniques.

2. Generate insights

The quality of the data insights also depends on the level of data maturity within the business. Even companies with a lower level of data maturity can produce valuable insights by deciding which areas to concentrate their talent team. For example, businesses with a low level of data maturity might use a data model focused on a single target for talent. They can then assess how data can provide insight or utilize existing HCM systems and ultimately take the lessons learned to develop into a long-term plan that meets various goals for talent and business.

3. Prove worthiness

The C-suite has to be aware of the value of analytics on people before they can support important investments on the basis of insights received from the analysis. Therefore, HR executives need to clearly show and convey the effects through tangible business metrics and results.

Examples include showing how investments in AI-powered learning capabilities could result in 30percent costs for workers and an increase in productivity of 17%.

Evidence of how analytics on people aid in achieving larger business goals and objectives. For example, overall cost savings and growth in an organization are good indicators that show worthiness.

4. Use data ethically

Data collection is vital; however, it is not as important. General Data Protection Regulation (GDPR) and the other local laws impact the kinds of information about employees which can be used to collect data.

For example, personal information such as a name should not be collected. But, if there is a need for it, like location is crucial for gathering information, but there are methods to circumvent this, like Coding or randomizing specific geographic regions to avoid using identifiable markers. Companies must have leaders who know the laws governing data governance in every country where the company is located. Good governance also calls for checking data for outliers or indirect markers that could skew results.

Benefits of Implementing HR Analytics

Growing the maturity of data and building an enterprise-wide employee data strategy takes some time. Still, this method will provide innovative ways of working for your employees and the company.

1. From sporadic to a strategic data collection

If the collection of data from your workforce is governed by the purpose of your larger business objectives, the data can be better used, and the insights that are generated will be more thorough. Let's say that the goal of your business is to increase the retention of employees. The data packages standard that HCM systems use will only give you a small amount. Businesses may wish to expand their reach to gather data from websites like Glassdoor or Indeed, which provide more insights into the mood of employees and feedback.

2. From data silos that are fragmented to the one true source

Suppose you have a plan that connects all data sources to a common cloud-based foundation and paints an overall picture of not just one employee but your entire talent management. These links are essential. For instance, if you combine data on employees' productivity, engagement, and patterns of unplanned absence with safety-related organizational developments for the construction industry, you might be able to detect the early indicators of employee fatigue or workplaces that are not ergonomic in real-time. Armed with this knowledge, leaders can make more informed and proactive decisions regarding the roles, rewards, security, and more.

3. From unregulated to responsible practices for data

Implementing a clear and consistent procedure for data design allows businesses to act responsibly and ethically when it comes to the data of their employees. It also helps to build trust among employees who are confident that their data is utilized responsibly. Think about diversity and inclusion programs. Organizations can use artificial intelligence to identify subtle patterns and reveal possible areas of bias. For instance, HR executives may spot a bias against women after observing patterns of lack of education or job opportunities compared to male colleagues. Correctly and responsibly managing these processes can help create a working environment that allows your employees and company to thrive.

Top HR analytics tools in 2021

Adopting HR analytics is an important decision for many professionals and companies. In fact one of the most frequently discussed topics amongst HR professionals is: "What are the best HR analytics tools to use?

Here are the top three HR analytics tools you can use in 2021.

1. R

R is among the top widely used HR analysis tool. R is excellent for visualizing and statistical analysis and is perfect for exploring vast datasets. It allows you to analyze and cleanse data sets using million of rows. It allows you to visualize your data and analyze.

The most commonly utilized Integrated Development Environment, or IDE for R, is RStudio. An IDE is a program that gives additional features for development of software as well as data analysis. This makes the program easier to use.

In simple terms, RStudio can do everything R does, but much more efficiently. The RStudio interface includes an editor to code, the R console, an easy-to-access workspace, a log recorder, as well as space for plots and files.

2. Visier

Visier is a data-aggregation service designed to address questions about the workforce. It integrates with various HR systems and ties them together into an HRBI software.

As compared with Tableau, Visier brands itself more as an actionable analytics and insights platform that reveals patterns in the workforce data. It also lets you answer questions on the factors that affect productivity and performance and other HR-related outcomes.

Visier provides an option that is similar to the standard people analytics available in the market. It is a tool that uses algorithms to anticipate the timing of promotions, exits as well as internal movements and more.


While Power BI, Tableau, and Qlik are used primarily to combine information, SPSS is used to actually examine data.

SPSS is among the most widely employed HR analytics tools within the field of social sciences. Because of its user-friendly interface, you can analyse data without having a lot of statistical knowledge. Since SPSS is commonly employed in the field of social science and HR, many HR professionals are familiar with how to use it, particularly those who are interested in data analysis.

This is also the reason we have included SPSS on our list but not its main competitor, SAS. SAS has many more users outside of that field of social sciences. Yet, SAS has a steeper learning curve. SPSS has many of the same features as Excel that makes it much easier to use.


No matter if you're new in the area or an experienced HR professional, keeping up-to-date with modern technologies such as people and HR analytics is essential to stand ahead of the competition. Every business has its own goals; however, how do they use data to accomplish these goals? An effective strategy to manage talent is the basis for more effective, data-driven decisions. It assures that the employee's data is utilized to benefit both employees and the business overall.

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