Why HR Analytics Is the Future of Talent Management and Business Growth

HR analytics is a powerful tool businesses can call upon to foster growth and develop talent. As you gain more access to more data, you need to be able to capture and analyze that data. It can educate you on what’s happening in your company. Across industries, understanding why and how things happen with your staff is critical. It ensures you and your employees benefit as much as possible from the informed decisions you will be more equipped to make.

You Can Find the Right People

Humans are inherently biased. They can’t help it; they tend naturally to hire people they know or who look and behave like them. So, while hiring managers might think they’re trusting their “guts,” their guts may have prejudices they’re unaware of. This approach to hiring can be problematic because it limits the talent pool in the workplace. Without diversity of experience, you have little to no diversity of thought. This means you limit innovation.

HR analytics can help you see from a data-driven perspective the demographics of your staff and hire accordingly. And this practice often comes with even more benefits. For example, businesses with a higher percentage of women in senior positions tend to have higher profits. This rule holds true when it comes to adding people of color, with different abilities, and from different backgrounds. HR analytics can offer insight into how to integrate more diversity into your team as well as how to attract the right people.

You Can Develop Talent

Still, it takes more than simply hiring the right people for your team to be successful. Regardless of background, experience, or education, your team members may still have gaps in their development that need to be addressed. You may have an employee with excellent credentials who struggles with customer interactions. Likewise, you could have a stellar communicator who remains undereducated in your industry.

Either of these missing elements and more can lead to negative outcomes for the employee and the team as a whole. The truth is you’ll never hire the “perfect team member.” But you can train and develop your people to become more aligned with the mission, vision, and values of your brand. Analyzing HR data can help you target areas for learning and even design training programs suited to your specific employees’ needs.

You Can Catch Problems Before They Fester

A destructive force for any company’s bottom line is low employee retention. Recruiting, hiring, and training employees is a huge cost. To then lose those employees is less than ideal when it comes to your overall profits. Employees leave a company for two primary reasons. First, they were perhaps not fit for the position in the first place. Second, they may have been struggling with problems that went unaddressed.

You’ve already seen how HR analytics can help you hire the right people. Descriptive and diagnostic analytics can also help you identify problems and understand why they’re happening. You’ll be able to tell in real-time if your employee retention rate is dropping and investigate why. Then, a great HR analytics program will help you come up with solutions to address internal issues. You might need to have an individual conversation or schedule more regular meetings.

You Can Make Informed Decisions About the Future

One feature of a great HR analytics program is its ability to help you prepare for the future. Called predictive analytics, it can help you stop negative cycles and create a healthier environment for your employees and customers. Quite often, businesses don’t change practices in the workplace, which leads to a toxic environment. It’s not typically because they like the negativity. Instead, it’s often because they’re blind to the issues.

It’s far too easy for senior management to miss troubling issues because they’re so busy with other tasks. But the data doesn’t lie, and once you see it, you are more likely to address it. Perhaps your staff needs to be able to work remotely. Maybe they need better integration among teams. Or it could be that they just need more communication from their mentors. Whatever the case, you’ll have the data you need to make those changes for the future.

You Can Remain Competitive

Finally, HR analytics at all levels can help your business remain competitive. Without the right people, learning and development programs, and the ability to get involved and make changes, you may fall behind your competitors. Why? Because the reality is that more leaders are coming to understand the value of running people-focused organizations. This means that if you’re not using HR analytics, you’re giving your competitors an advantage.

You can use descriptive analytics to get a complete picture of your team and how it functions. Diagnostic analytics will help you explore the root causes of what’s working and what isn’t. Predictive and prescriptive analytics can then lead you toward preparing for the future based on clean, rich data. With these four features in your HR analytics program, you’ll be able to build, train, and manage highly efficient, happy employees that contribute to your business growth.

In the end, HR analytics is an asset to HR teams investing in the recruitment, hiring, and development of talent for your organization. As technology allows you access to more, and more accurate, data, it is in your best interest to make use of it. Especially when you can work with a program that will help you understand that data. It will enable you to make the decisions that keep your employees happy at work and your company thriving.