Abstract:Asdemand for better talent management is growing, organizations are becoming moredata – led hence making people data become currency and Workforce Analytics hasbecome the need for every organization. The emergence of latest IT software Workforce Analytics helps to gather,manage and use talent information more effectively than ever before. These datahas helped the senior level management to gather information about their peoplewith help of these information future decisions is being made. HR Analytics is beingused for many HR Value chain elements such as recruitment, performance,development and transitioning, selection, on-boarding, performance management,succession and talent planning and employee engagement as well. Hence it can be concluded that HR Analyticshas in deed become the panacea for all the problems and challenges which theHuman Resource function has been facing and proved to be the vital tool forgaining competitive edge in this fierce changing economy.
This conceptual paperstudies the role of Hr analytics in the field of Talent Management through studyof various popular literatures and tries to suggest various avenues of futureresearch. Keywords: WorkforceAnalytics, Performance Management, Employee Engagement Introduction:Information technology has brought newrevolutionary concept like HR analytics which quantifies the HR aspects with moreease. HR Analytics has helped organizations to mine the qualitative data ofHuman Recourses to derive quantitative measures of HR intelligence which can beused to optimize the key performance indicators hence driving performance.Human Resource department seizes mammoth amounts ofdata about the employees like employee performance, turnover rate, jobmobility, training and development, compensation, staffing and many more butthese remain stagnant in various HR systems and are rarely used for anystrategic decisions. But with the emergence of the latest IT technology viz.
HRAnalytics, these unused data can be utilized for making fact based strategicdecisions. HumanResources Analytical tool has provided HR executives, HR professionals and linemanagers with the powerful metrics,alerts, and reports, in order to understand how workforce factors are affectingindividual departments and provide necessary basis to take appropriate actions.Managers and front-line professionals receive critical information on staffing,recruitment, training and development, performance, workforce cost, anddiversity at each level such as by demographic details, geography, jobcategory, division, and pay grade, etc.HR analytics or workforce analytics aids the organizations to makeworkforce decisions by reducing the costs, identifying the revenue streams,mitigate risks, and execute effective business strategies. HR analyticsempowers the HR managers with accurate predictive analytics which determinesthe future, mainly for the organizations seeking more proactive role in drivingbusiness strategy.
HR Analytics enables the HR Managers to make human strategiesthat impacts the business results. Hence, it enables the HR to be more engagedin the formulation of the corporate strategy. Objectives:· To study the role of HRAnalytics in optimization of workforce.· To study the impact of HRAnalytics in the overall talent management through various availableliteratures.Literaturereview:Oraclebusiness intelligence article (2011) states that globalization and changingcorporate dynamics has increased the trials to HR on how best to improve anddeploy an agile and highly-competent workforce while maintaining costeffectiveness. Today’s business challenges mandate more than just greaterefficiency in the HR department and an HRM system rather requiring them to increased their effectiveness and gainthrough a comprehensive understanding of the factors driving workforceperformance Thus the emergence of a new digital technique like HR analytics hastouted to be the panacea for the HR in the organizations.KinleyN and Ben-Hur S, (May9, 2013), in their article Turning Talent data into Talentintelligence said that a decade ago Mckinsey declared that the war for talentwas coming and he’s statement was seems to be right. Globalization and shiftingpopulation demographics has caused competition for talent is growing and makingit harder than ever for business to find the talent they require.
Realizingthis problem every organization are turning into talent management and drivento invest most notably. The article states that as demand for better talentmanagement is growing hence organizations are becoming more data – led hencemaking people data become currency and Workforce Analytics need for everyorganization. The emergence of latest ITsoftware Workforce Analytics helps to gather, manage and use talent informationmore effectively than ever before. These data has helped the senior levelmanagement to gather information about their people with help of theseinformation future decisions is being made. The article states the example ofhow Google has become the market leader and its way ahead of the curve when itcomes to people data.
The system has enabled Google to develop comprehensivedatabase that captures the information about current employees’ attitude,behavior, personality, biographical information and job performance enablingGoogle to develop an algorithm for predicting applicants which are most likelyto succeed. By using Analytics in theorganization talent management has become easier. This information has helpedin succession planning, managing talent pools, managing talent ‘on demand’finally making the talent management streamlined and simple.
Bereno(2011) says that HR analytics empowers the managers to gain information aboutdifferent talents and then develop a strategy to deploy their expertise for newbusiness avenues and leadership development. It further provides information onmany important factors for the maximization of workforce analytics, whichincludes defined workforce challenges, consistency in data collection andmaking the platform easy to use.Thebook Moneyball: The Art of Winning Unfair Game by Lewis (2004) has provided oneof the greatest example on how data analytics has radically shaped the way weunderstand how the organization works. The book describes how the GeneralManager Billy Beane of Oakland Athletics Baseball team utilizes data to analyzeand predict baseball player’s performances. By using Analytics Beane assembleda competitive team with cost a quarter of the player paid by the New YorkYankees but his team ended up winning same number of wins as its rivals the NewYork Yankees but with less than half of its rivals cost.
By using and relyingon metrics Beane predicted the number of wins and by using players whose skillswere not recognized by others he built a team making them unpredictableplayers. By using Analytics for his recruiting strategy Beane changed therecruitment tactics for the world. BruceFecheyr-Lippens, Bill Schaninger, and Karen Tanner (March, 2015) in the articlePower to the new people analytics published in Mckinsey quarterly says that problemsof employee dissatisfactionand retention can be tackled through techniqueswhich are used to mine consumer andindustry data.
The latest data andanalytics buzz that arecoming from the field of advanced HR analytics, where the application of newtechniques and new thinking to talent management is becoming more main stream.The implications are dramatic because talent management in many businesses hastraditionally revolved around personal relationships or decision making basedon experience(or performance evaluation measures) not to mention risk avoidance and legalcompliance rather than deep analysis( involving quantitative techniques andsophisticated softwares). These advanced analytics provides a uniqueopportunity for human-resources professionals to position themselves asfact-based strategic partners in the organization, using cutting edge techniquesto recruit and retain the great managers and great innovators who so oftendrive superior value in companies.
Manyleading organizations are already using advanced HR analytics successfully incertain talent-management areas. A leading healthcare organization, forexample, has used analytical techniques to generate more than $100 million insavings while simultaneously improving workforce engagement. The organizationfound that highly variable and unequal compensation levels were disturbingemployees and driving high rates of attrition. Once the data analytics hadidentified an optimal minimum and maximum compensation threshold, thehealthcare group increased the engagement and productivity of its employeesthus reducing not only their rate of attrition but also its total compensationexpenditures. Another company also reduced its retention bonuses by $20 millionand employee attrition with the use of predictive behavioral analytics.
Throughthis process the firms have found that limited investment in management andemployee training, and inadequate recognition, were the main drivers of staffdefections. Expensive retention bonuses, to which the company had resorted indesperation, were simply an ineffective and costly Band-Aid. Many companiesconventionally try to tackle retention issues by conducting in-depth exitinterviews. The important advantage of the new analytics techniques over thatapproach is that they are predictive, rather than reactive, and they providemore objective information than the more qualitative findings of a one-on-onediscussion.In the article, A guideto HR analytics in the Tech Target Search Financial Applications agrees to theabove article that Human Resources is stepping into the spotlight withHR analytics. Traditionally, HR’s primary goals were to gather and maintainrecords of employees’ personal and professional information, such as payroll,health benefits and performance reviews etc. Now, the emergence of technology employinganalytical tools and techniques, thus encouraging the HR managers to generate more meaningfulresults through analyzing complex, heterogeneous data with many outliers and playa more active role in the organization. The most important note is that HRmetrics are not the same as HR analytics.
HR managers typically used metrics tomeasure such data as turnover rates and sick days. With HR analytics, they cangauge employee engagement and whether or not workers have the skills to reachcompany goals. HR representatives can now exchange ideas with business leaders,by finding out what they need and hire accordingly. HR analytics allows humanresources to interpret data, recognize trends or issues, and take proactivesteps with different departments to keep the organization running smoothly andprofitably. HR analytics has pushed humanresources into more active and involved role in organizations’ planning and objectivesand making them a strategic partner.
Organizations are also now turning theirattention to employee engagement with HR analytics, abolishing unreliablesurveys and using sentiment analysis to measure engagement in real time. HR analytics software has allowed theorganizations to model their workforce and measure employee engagement with sentimentanalysis. Besides data quality and analysis benefits, analytics is critical tocontinued relevance of the HR profession because employees are not alwayswilling to be forthright when they answer workplace surveys provided by theiremployer, the data is not always reliable. With the help of the data from thecustomer relationship management (CRM) HR can assess if the employee is reallyperforming in the job. Social media and sentiment analysis are tools thatorganizations use to measure customer satisfaction, and they could prove justas useful in measuring employee engagement. Another article by Beeline (2012)Workforce Analytics, how to define measure and drive productivity in today’sorganization, describes the standard to identify the people who bring the mostvalue and to cultivate and motivate is satisfied by HR analytics. Thechallenging economy in today’s world is forcing organization to have its HRpolicies and strategies align with its overall business goal to gaincompetitive edge over its opponents. Dr.
John Sullivan (February 26, 2013) in the article How Google Is Using PeopleAnalytics To Completely Reinvent HR discusses how Google has moved up frombeing the youngest to being the top business leaders in the present market.This has been possible as Google has used people management strategy that isthe result of its software “People Analytics”. New path firms dominate by producing continuous innovation.Google has learned that continuous innovation cannot occur until a firm makes astrategic shift toward a focus on great people management. A strategic focus onpeople management is necessary because innovations come from people, butinnovations can’t be maximized simply unless the organizations are capable ofrecruiting and retaining these innovatorsand endless support also has to be provided to them with great managers and anenvironment that supports innovation.
The simple foundation of “peopleanalytics” approach is that accurate people management decisions are the mostimportant and impactful decisions that a firm can make. A firm can not simplyproduce superior business results unless the managers are making accurate peoplemanagement decisions. Each one of business decisions is made by an employee.
Hence the hire and retaining of these employees needs to be managed moreaccurately and for doing so proper data is needed, otherwise it can only assumethat they will make mediocre decisions in each of these important businessareas, as well as in people management decisions. Hence Google after changing itsstrategy in adopting People Analytics has proven to be the greatest strengthpushing the organization to become the market leader in the short span of time.Suzanna Colberg (March 26,2016) in her article about How ‘People Analytics’ is Redefining the WayWe Work, Live, and Hire says that the need for people analytics within an HRfunction has been a discussion that has been on the table for the past severalyears. Extensive digital and cultural changes in the modern workplace havebegun to reshape and redefine both the structure of organizations as well asthe culture of the workplace and, in many cases, the work itself.
Now organizationsare relying more heavily on the data to find, hire, and manage talent.Conclusion:Allgreat management thinkers have been harping on the fact that managing workforceor human resource is the most vital, most crucial and the most difficult jobfor any organization. Theories and practices have come up and evolved tounderstand and better manage the workforce as it can be the game changer or theedge that an organization needs to overtake it competitors. The latest being HRanalytics which is considered to be the next big thing in the world of everevolving HR.
By reviewing the literature it can be inferred that human resourcemanagement has been taken to the next level where HR is no longer just afunction but it contributes to all the functions in the organization with aprimary focus of enhancing organization performance.Therefore, to have a competitive edge over its competitors, strategic planninghas become more critical for business units and subsequently for various HRfunction as well. By adopting HR Analytics to govern the decisions making andstrategic development processes, new opportunities has arrived which areapplicable to all core HR processes such as talent acquisition, attrition, riskmanagement, succession planning, retention, compensation planning, and capacityplanning. By using HR analytics organizations have taken the guess work out ofthe employee management by means of leveraging analytics to improve theirmethods of attracting and retaining talents, connecting their employee databaseto business performance which has help them in differentiating themselves fromtheir competitors.References: Article, A guide to HR analytics in the Tech Target Search Financial Applications http://searchfinancialapplications.techtarget.com/essentialguide/A-guide-to-HR-analytics Beeline 2012.
Workforce Analytics: How to define, Measure and Drive Productivity in Today’s Organization, Retrieved on 31st October 2014 from http://www.beeline.com/downloads/pdf/BEworkforce-analytics.pdf. Bereno, A. (2011) Maximizing workforce analytics, HR Professional, Vol 28, Issue 2, pp 24. Bruce Fecheyr-Lippens, Bill Schaninger, and Karen Tanner (March, 2015) in the article Power to the new people analytics published in Mckinsey quarterly http://www.mckinsey.com/business-functions/organization/our-insights/power-to-the-new-people-analytics· Colberg S (March 26, 2016) in herarticle about How ‘People Analytics’ is Redefining the Way We Work, Live, andHire http://www.business2community.com/human-resources/people-analytics-redefining-way-work-live-hire-01490914#6MDZkZlyZrmUDlYH.97· Oracle business intelligence (2011)Oracle Human resource Analytics, article in Oracle data sheet· Oracle Human Resource Analytics, Buildan agile workforce Brochure, Retrieve fromhttp://www.oracle.com/us/solutions/business-analytics/analytic-applications/business-role/hr-analytics/overview/index.html· Sullivan (February 26, 2013) in thearticle How Google Is Using People Analytics To Completely Reinvent HRhttp://www.eremedia.com/tlnt/how-google-is-using-people-analytics-to-completely-reinvent-hr/