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8 Key Benefits of HR Analytics

Published: August 12, 2019 In: Remote Hiring


Human resource is witnessing the advent of two major fields, The Big Data, and Hiring Analytics. The power of HR Analytics and Big Data is making companies ditch their “intuitions” for any decision to make, which was the trend earlier, and take more informed decisions now. Official decisions have become more promising and accurate with the use of HR analytics. 

That is why companies are investing huge money into talent management software and special staff including data scientists, statisticians, and analysts.

But according to a study by Deloitte, three in four surveyed companies (75 percent) believe that using data analytics is “important”, but just 8 percent believe their organization is “strong” in analytics—almost the same percentage as in 2014.

Let's understand what HR analytics and Big Data really mean. When an organization keeps a record of all the candidates and employees, it means the HR has an excess of data about the manpower in their organization, making it easier to manage them and hoping to improve their performance and get a better ROI. Gone are the days of repetitive processes in talent acquisition. They have become a waste of time and resources.

As enterprises are realizing that employees are the central bodies of the organization, it is the HR department that takes care of every aspect of these bodies. In that way, HR becomes the data collector of the organization, collecting information regarding employee information, hiring requirements, salaries, attrition, etc. But HR analytics does not just deal with gathering data on employee efficiency. Instead, it aims to provide insight into each process by gathering data and then using it to take relevant steps to improve these processes.

There are various aspects in workplace where HR analytics and Big Data can be useful:

  1. Talent Acquisition

  2. Training and Induction

  3. Performance Review

  4. Compensation

  5. Rewards and Benefits

  6. Retention

  7. Marketing



This useful data that we are talking about could be scattered and unused in the absence of a proper HR analytics tool. This is why a desirable HR analytics tool could use HR and big data analytics to interpret this useful data and transform it into useful statistics. Once patterns are highlighted, HR can decide what to do with it based on the findings. Analytics are used to examine the effect of HR metrics on organizational performance. In general terms, analytics look for patterns in metrics.

For example, do high performers leave more often than low performers in an organisation and if so, what is leading to that turnover?

By using analytics, you can become predictive over time. In other words, you can use data you probably already have to discover answers to questions like which of my top performers are at risk for leaving the organization in the next year, or which HR initiatives (training programs, reward and recognition programs) will most impact the bottom line, or who will be the most successful employee in our organization.

Here are 8 benefits of HR analytics:

1. Improved Hiring Decision

HR analytics helps HR to make better choices based on historical data. A great HR analytics tool can make a difference by enabling HR to easily derive the best candidates to hire from the historical data.

For example,­ if you hired 10 candidates and 4 out of them belonging to a particular background couldn't qualify beyond a level, perhaps you will not hire someone from a similar background again. HR analytics prevent you from making such mistakes. Moreover, it also allows the recruiter to learn more about candidates through online databases, applications, social media profiles, job portals, records, etc.

Check out why psychometric assessments are important!

2. Reduced Talent Scarcity

Data-driven recruiting strategies provide the insight needed to cast a more accurate net to ultimately build a larger pipeline. With the help of HR Analytics, it is easier to know who to target for a particular position when a requirement arises in the company. It is easier to understand the type of person required, the knowledge required along with other aspects that might be missed in a regular talent acquisition process. When talent is scarce for a specific industry or role, it might seem that talent isn’t there at all. The talent is there, but finding them can be quite challenging.

3. Process Improvement

Once the company has enough data to provide to the experts to come up with accurate statistics and patterns, the company can then use it to make the recruitment process much quicker and efficient. Hiring managers will know which positions in the company require what type of talent, people, background and experience, along with the type of people that will not be suitable. Then it becomes much more elementary to target a specific audience and talent pool and get much faster solutions to their challenges.


4. Good Training

Training is a necessary requirement for any organization. Gaps in the process of training can increase the cost to the company and unwanted issues. Various professional development programs offered by the companies, if not handled properly, can deplete a major chunk of the company’s budget. It is highly suggested that enterprises invest in training by collecting data and learning from the pattern. HR analytics provides the full swing to training programs. It helps the organization identify if employees are making full use of the opportunities and knowledge given to them during training programs.

5. Better Insights

HR analytics help the company look at the employee's professional life by tracking, sharing, and analyzing performance-related data. This is why companies track and record the behavior of its employees with customers, co-workers and how they spend their time. Furthermore, the employee's performance data could be used by the hiring manager to identify great talents. This data not only provides more insights about the employees but also shapes the strategies to boost employee morale, retention, and engagement.

6. Attrition

When it comes to retention, HR analytics is the major tool to identify the retention rate of employees. It tells the company the reason why employees leave and why they stay. The reasons could range from under-performance, compensation, lack of skills to anything else. HR analytics could also be helpful in finding the gap areas where employees are finding difficulty in meeting goals and targets. HR can use various methods like employee surveys, team assessments, exit and stay interviews to find out the reason for attrition and map out strategies to retain them.

7. Improved Employee Experience

Once your recruitment process becomes swift, it automatically gives a good impression to candidates you want to attract to your organization. It makes the recruitment process faster and the candidates don't have to wait for weeks or months to know whether they are going to join an organization or not. This gives them a better candidate experience and improves the brand image simultaneously which gives your enterprise an edge over competitors.

8. More Productive Workforce

Since enterprises have a grip on the kind of people to hire for a job, it becomes easier to expect better performance and productivity from employees. With analytics, you get an understanding of the workforce and hence know what kind of environment, policies, and teams will make them work hard and give you results that you expect from them.

The Future of HR Analytics

Many organisations have actively started using Big Data and analytics and have been reaping the benefits of the same. Cognizant, HCL, Deloitte, ZS Associates, and Talview, to name a few have been consistently making use of HR Analytics as a daily practice.

We’re experiencing monumental changes in the HR landscape. Organizations are realizing they need to embrace a data-driven culture to compete with others and attract top talent. Data analysis has taken over as a necessary tool to move beyond gut feeling, but it comes with its own challenges. Once consensus is gained by removing peoples' apprehensions to move beyond traditional ways, then human resource management solutions will need to be chosen with care to ensure goals are met.

Prior to ML, organizations would manage data in manual and semi-automated ways. It would collect, store and process data to produce analytics before the data became irrelevant and needed updating. Moreover, there was a wastage of useful data that could help enhance company performance if stored and assessed properly. No data was being used and reused for multiple reasons and solutions, until now.

With machine learning, we can understand patterns in Big Data and accelerate business through automation. Resume parsing, for example, fast-tracks the screening process by identifying the candidates with the apt skills and education with existing data. Artificial intelligence also helps eliminate human error. Other concepts allow matching skills and qualifications of job seekers to provide a list of recommended jobs and creating relevant personalized learning opportunities based on individual learning history, goals, and preferences.

Psychology is also playing an increasingly important role in HR. Industrial/organizational psychology helps apply psychological principles to employees of an organization with the goal of increasing productivity and employee well-being while maintaining overall organisational performance.

While analytics has been a game changer for many years, these new possibilities promise a plethora of potential from data insights.

Tags: Remote Hiring, HR Tech & AI, Recruitment Best Practices

Written by: Olivia Gomes

Olivia is a Content Marketer at Talview. She completed her graduation in English Literature and MBA specializing in HR, so she combined her two interests and now writes about HR tech updates and latest trends in the world of talent acquisition. Her other interests are traveling, writing, and deconstructing the psyche of people around her.

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