Using HR ANALYTICs to monitor human capital
Using HR Analytics to monitor human capital is a powerful approach to performance management. It helps companies measure and improve their processes, which is crucial to improving the bottom line. Moreover, collecting data about employees and performance will allow organizations to monitor progress and predict future outcomes. While HR professionals are familiar with the importance of data analytics, they may not fully appreciate the power it can provide. This analysis can focus on internal processes or on the organization’s larger objectives.
The use of people analytics can help companies measure the impact of policies on employee performance. Using data from different periods will allow companies to test the effect of a particular policy. In addition to assessing performance, people analytics can be used for recruitment, succession planning and career pathing.
One of the main KPIs used to measure human capital is turnover rates. A high turnover rate can impact the success of a company. Several key performance indicators (KPIs) are used to measure this. For example, a high turnover rate could indicate that the company’s policies and procedures are not working as intended. High turnover is costly for any business, and a high percentage could indicate several issues.
It boosts employee engagement
When using HR analytics for performance management, organizations can prevent turnover and increase employee engagement. A recent study conducted by the shoe retailer Clarks found that a 1% increase in employee engagement boosted business performance by 0.4%. The company also found that the tenure of store managers affected employee engagement, and developed a template for high-performing stores and a toolkit for managers to increase employee engagement.
Employee engagement is a critical management metric, as it is highly correlated to profitability. In addition, highly engaged employees are more productive, more likely to stay on, and are more likely to go above and beyond their job descriptions. Additionally, using employee engagement metrics allows HR teams to catch problems before they impact business performance.
Organizations are facing unprecedented challenges when it comes to attracting and retaining talent. The cost of turnover is estimated at 50 to 60 percent of business expenditure for Fortune 500 companies, and the cost of replacing one employee can cost half to two times the employee’s annual salary. Fortunately, organizations are increasingly leveraging HR data to improve employee engagement.
It hinders collaboration
HR analytics is a popular buzzword these days, and the hype surrounding it is hard to ignore. With so much hype around AI and data science, management has probably read about it but isn’t sure how to put it to work in their organization. Unfortunately, implementing data analytics in an organization may be harder than it sounds. Here’s how HR can use analytics to make its work more efficient and effective.
First, HR managers must be better equipped to understand and use data. Many HR managers are not good with numbers, and their roles are not clearly defined. This can lead to issues with the implementation of HR analytics and missing out on the added value that the analysis can bring to the company. It’s important to define who’s responsible for the analysis, and make sure everyone has a role.
Second, HR business partners are often not the actual users of HR analytics. As such, collaborating with them can limit the results. Oftentimes, HR analytics results are presented to management or the board, but this can inhibit its implementation and impact. It’s crucial for management to be involved in HR analytics, as this plays a key role in legitimizing it. In addition, management can prevent further HR analytics projects from being implemented without their involvement.