How many resilient organizations can you think of in less than thirty seconds? Five, or maybe ten.
Google is the best example of a resilient organization. According to a JazzHR infographic, 90% of Google employees participate in employee surveys, highlighting the role of people analytics investments by the HR department. This step has helped Google implement new policies and practices to make the workplace more inclusive and diverse.
All these efforts have helped build Google “that’s for everyone.”
Why are resilient organizations hard to find and build?
This happens because many organizations fail to embrace people analytics as a means to develop their culture and hierarchies where collaboration, trust, empathy, diversity, equity, inclusion, and growth can all come together and benefit the employees.
Between 2018 and 2023, we have witnessed a big shift in the way HR organizations adopt and use people analytics for their growth and sustainability. The year 2023, in particular, would be associated with economic uncertainties, rising inflation, massive layoffs, unemployment, and a shrinking talent market.
Did you know organizations are paying more to hire key talent in 2023? Funding expenses for hiring and compensation is the second-highest spend category for CFOs after IT budgets related to digital technology. According to Gartner, there is a significant gap in expenditure for back-filling vacant roles and hiring new talent in the organization. It proves that HR leaders and CFOs must have a similar line of thought on HR expenses for talent management and organizational development in 2023.
In such unpredictable times, HR technology users need robust people analytics software that can predict the attitude and outlook of people that they hire and employ in their organizations. If you are using the same people analytics template from 2022, it’s time to change the narrative for better results. According to Ventana Research’s report, titled “Achieving Success with People Analytics”, ‘analytics’ is the most important HR technology for 77% of organizations.
What HR leaders need today is more automation-friendly intelligent and predictive people analytics software with leaner integrations with the existing HR Technology stacks.
In this article, we have identified powerful forces in people analytics that influence organizational development during a crisis, such as the one we are seeing this year.
Let’s uncover these forces one by one to help you build a resilient organization for the future.
Understanding People Analytics
People analytics is your number one evidence-based HR tool for 2023. How much is the industry worth in 2023?
In order to build a resilient organization, HR teams should be formally trained in data analytics and business intelligence domains.
People Analytics is a combination of two words – “People” and “Analytics”. From an HR team’s perspective, “people” refers to the organizational workforce. People Analytics, therefore, could also mean talent analytics, workforce analytics, or HR analytics. Generally, business leaders prefer to use all these interchangeably, as all these could mean the same exact thing.
In 2023, an HR team may be utilizing the same people analytics software to measure the different HR metrics. These can limit the potential of your organization.
Generally, people analytics data sources consist of these categories:
- HRIS data (demographic data, recruitment, leadership, learning, and development)
- People management data (Talent and development, demographic, well-being and wellness, travel, family)
- Financial data (insurance, payroll, compliance, penalties, bond)
- Non-HR data (CRM, quality of service, sales data)
For a very long time, HR professionals focused on the only “people” side of the business, ignoring the basics and advanced techniques of “analytics” that influence people management strategies. But, times have changed.
With AI and no-coding co-pilots arriving, HR technology users with versatile data science backgrounds can solve people-related crises faster than their peers who lack data skills. The recent reports have revealed this gap.
According to an SHRM study, 94% of HR professionals use people analytics software to elevate the effectiveness of their HR strategies. However, a majority of organizations are yet to tap into the potential of this powerful
HR technology. The limited expertise in data analytics and depleting data literacy within the organizations slow down the outcomes.
In fact, more than two-thirds of users (77%) leverage people analytics software to find out what happened in the past, while only 4% of HR executives use it to analyze data and to find out about the future. These create a vacuum in the HR organization, restricting the users from focusing on important activities such as HR budgeting and financial planning, DEI initiatives, and performance management.
How to succeed: If you are on a mission to build a resilient people-centric organization, focus on hiring more HR data analysts.
If you want a 100% return on investment from your HR Tech and data science stacks for people analytics, hiring trained HR data analysts and creating a people analytics department will put you among leaders who have scaled their organizations in the last 2-3 years.
People Analytics KPIs You Should Be Measuring (But Probably Aren’t!)
As a HR professional, you could be analyzing hundreds of different types of HR metrics using the same dashboard. However, are all these HR KPIs really helpful to you?
According to Ventana Research, people analytics dashboards are missing their mark and failing to impress decision-makers. They are either too complex to read or too simple and generalist in outcomes, delivering very little or no meaningful results to the users. Agile HR organizations that have migrated to a low-performing, cost-friendly (but features-deficient) people analytics software could see their productivity levels falling within a few weeks of deploying such a platform.
87% of business owners rely on HR reports and analytics for organizational strategy. However, less than one-third of HR professionals are actually happy with the quality of the reports they receive every month. They would prefer to see more granular-level HR data reporting. There are many other challenges in people analytics reporting.
According to BambooHR, 16% of non-HR executives have no idea how often the HR team sends reports. There is so much room for improvement in people analytics, especially in the large-sized departments where any insight on employee experience can have a huge impact on organizational productivity and overall employee satisfaction scores.
According to a people analytics survey by Visier, advanced organizations don’t restrict their efforts in leveraging people analytics for mundane and traditional reporting. They explore more topics (on an average of eleven new topics versus eight) to build and grow their teams.
The graph shows the top ten areas in advanced organizations where people analytics makes an impact.
Majority of business owners adopt people analytics to improve the overall HR effectiveness during the various stage of talent management. These are particularly important in deciding the outcomes of critical HR functions such as hiring, training and development, internal career mobility, compensation and rewards planning, promotions, and conflict resolution.
The focus areas in 2023 consist of the total cost of workforce (TCOW), compensation, organizational design, pay equity, talent acquisition, learning, and productivity.
Organizations financially outperform their peers by using people analytics for faster, accurate, and transparent real-time decision-making using HR data.
Advanced organizations have a clear vision for linking HR metrics with their financial goals. These are data-driven HR teams that AI use technologies to integrate information from disparate data sources. These include data sources from other departments such as Marketing, Sales, Customer Service, IT and Security, Finance and Accounting. The internal benchmarking of HR metrics help in solving data quality issues that prevent conventional dashboards from providing information on the most critical HR operations.
DEI as a Key Marker in Organizational Development
People, irrespective of their job titles, perform better when they feel included and embraced with a sense of belongingness, without any hidden bias. Starting with DEI hiring agenda is a good strategy before shifting focus to an unbiased people analytics software to optimize the organizational structure and workforce management.
Recent trends have found a strong correlation between the success of organizations using People Analytics software for data management and their overall DEI initiatives. Organizations can use advanced people analtyics and reporting to identify talent diversity gaps and fill them with bias-free and inclusive team-building efforts. These teams make faster decisions, are more understanding, have fewer conflicts, and do lesser meetings to arrive at a conclusion. Overall, advanced organizations use people analytics to discuss their DEI agenda before moving ahead with any radical shift to meet global workforce demands.
Choose AI-powered People Analytics to Take Control of Organizational Change
ADP is one of the leading providers of workforce analytics solutions in the HR technology marketplace. It featured in our HRTech RADAR for two consecutive editions. HR professionals and business owner with little or no experience in HR data analytics can gain deep insights from this software. You can answer complex questions on workforce diversity, pay equity, and other complex issues using 30+ HR metrics.
Overall, ADP is useful analytics software for matured HCM users who want to advance into a more futuristic AI-powered predictive recommendations for workforce modernization.
Investing in the right AI tools and reporting dashboards can put you steps ahead in the evolving HR technology market. Most HR leaders and business owners are confident that AI can solve most of their existing challenges related to hiring and compensation management, talent retention, and organizational growth. However, in order to unlock the real impact of people analytics, businesses need a solid line of command for AI functions. Today, only 9% of HR professionals use a people analytics software with AI features. These heavily dents the effectiveness and accuracy of their decision-making. AI in HR data analytics also improves the integration with other data sources, particularly from the finance and customer success teams. As HR business models change to take on the new narratives of an emerging automated workforce, AI’s role could enhance with more focus on data extraction, database management, IT consolidation and employee listening. In short, AI-powered people and HR analytics would emerge as the biggest catalysts for change management in the near future.
Here are the top people analytics software makers that you can use to build a resilient organization in the next 12 months.
ADP DataCloud – Workforce Analytics
Workday HCM Reporting and Analytics
Oracle PeopleSoft
Microsoft Agile HR Analytics – Power BI Dashboards
Paylocity
BambooHR
UKG Workforce Central
Gusto
Ceridian
Paycor
Zenefits
IntelliHR
Cornerstone HR
Sift
[To share your insights with us, please write to sghosh@martechseries.com]