Yanbu Aramco Sinopec Refining Company (YASREF) Ltd.
How HR Analytics is Changing People Management
Need for HR Analytics
Human Capital is most critical asset to any organization. Human capital is most important factor in maintaining competitive advantage. It is evident people bringthe long-term success to the organization. Yet, organizations have not applied the same rigor to understand this critical asset. Traditionally HR is more engrossed in transactional role; compare to themuch developed functions such as Finance and Supply chain management, HR is not experienced traditional depth in creating fact-based decisions.Only recently the linkages of Business objectives and people strategies have driven the organizations to create and use HRAnalytics.
Understanding HR Analytics
There is a general perception in many organizations that HR analytics means Head count, Labor costs and Turnover.But it is slightly more than that; it’s all about linking workforce related information to the organization strategy and its operations.HR analytics provides vital data in creating a model for Organizational performance. It is doneon the basis of ‘Qualitative and Quantitative’collection of workforce dataof past and present and to create future drivers.
To create an effective analytics, understanding of the ‘Business model’ and its strategy is very important. The analytical data can be collected from;
- Work force involved in processes, structures, roles designs andnature of employee deployment in filling those roles.
- Understanding the workforceby quantity, quality, time and cost required for the business model.
- By evaluating workforce engagement and motivationare in terms of how they meet or exceed performance standards.
- Data can be collected right from the areas of employee acquisition, employee management, employee development, employee engagement and employee retention.
Six steps for maximizing the value
- Understand the real issues of the company, start with an important business goal, challenge, or priority.
- Determine the HR variables that drive the goal or impede it.
- Identify related HR approach or strategiesand apply a conceptual model.
- Define type of data and capture relevant data.Select appropriate metrics from which organizational insights can be drawn.
- Using analytical methods present statistical findings to stakeholders.
- Take metrics based actions and define action steps to Implement the solution and disseminate the action plan across the organization.
Types of Analytics
Operational Analytics: Reactive, It is operational reporting of workforce efficiency &compliance measures. The analytics can be used for corrective actions.
Advanced Analytics:Proactive, It is operational reporting for benchmarking &decision-Making initiatives. It is based on multidimensional analysis &dashboardsare used to create statistical modeling and root cause analysis to solve business problems.
Predictive Analytics: Strategic, It is development of predictive models, scenario planning,risk analysis &mitigation. The analytics can be integrated with Strategic Planning.
Benefits of HR analytics
- Meaningful measures of HR performance in the context of your organization.
- Enhance decision-making and direction- setting through effective use of measures, assessment and evaluation.
- It helps to measure and manage the people performance.
- Greater accountability for Human Capital.
- Move from transactional to strategic role.
Conclusion: Data driven insights are always better than subjective HR practices. Thus HR Analytics is all about workforce trends, workforce utilization and workforce development. The core agenda is minimizing risks and maximizing returns.