HR analytics

Citation

Nolan, S. (2011), "HR analytics", Strategic HR Review, Vol. 10 No. 2. https://doi.org/10.1108/shr.2011.37210baa.001

HR analytics

Article Type: Editorial From: Strategic HR Review, Volume 10, Issue 2

This issue of Strategic HR Review is focusing on HR analytics. Every area of HR and, in today’s tough trading conditions, every area of business, feels the impact of analytics. This is driven by a need to understand return on investment (ROI), and to gain access to relevant, timely and meaningful interpretations of data that will help refine processes moving forward. Some papers in this issue focus in on specific HR processes, such as recruitment, development and talent management, while others look at the need to use analytics as a link between HR and organizational strategy to truly understand the impact of the people strategy.

Nicky Garcea, Stephen Isherwood and Alex Linley look at strengths-based recruitment in their paper, “Do strengths measure up?”. They see strengths-based assessment as the natural progression from competency frameworks, which themselves evolved from intelligence-based testing. Strengths-based selection combines competency-based assessment with job analysis to try to take into account both the long-term skills needs of the organization and short-term role requirements. It differs from competency-based testing by being more specific and granular in its outcomes, and taking into account hard to measure constructs such as energy, authenticity and curiosity. Making it more challenging is the fact that it is not just about measuring known strengths, it is also about tapping into unrecognized strengths that lay dormant. Assessors are trained to recognize natural strengths and to look for evidence of high performance. By matching individuals and roles in such a way as to focus on their natural strengths, individuals should be more productive and naturally energized by the work they do.

In “Developing talent intelligence to boost business performance”, Alice Snell draws on international research among HR and business managers to analyze business and HR attitudes to talent metrics and analytics. The findings show that there is a keen awareness of the need for metrics to support talent with timely insights. However, there is a disparity between the data required and the data available due to a legacy of disparate technology systems and a tendency to focus on measuring efficiency rather than effectiveness – for example, measuring time to hire, rather than quality of hire. She puts forward steps to guide HR professionals to focus on the right metrics and select the most important data elements and to translate this to reporting requirements for a technology platform, stressing the importance of having a unified talent data system. A case study demonstrates how access to the right effectiveness metrics can help HR teams spot people problems and address them quickly. This kind of timely intervention also helps HR demonstrate its value to the organization through tangible and quantifiable outcomes.

In her case study feature, “How to use a data-focused approach to embed good HR practices”, Hilary Briggs looks at how a data-focused approach can improve project outcomes, as well as provide information that will enhance HR practices by providing the foundations on which they can be built. It ties them in to the business, and vice versa, and provides clear goals and standards across the organization. What began as a project for the development of a plan to achieve long-term growth, resulted in the emergence of shorter-term objectives to improve profitability and staff performance. Starting with a diagnostic survey facilitated the identification of staff views on the organization and their roles and identified the de-motivators in the business as well as staff ideas for improvement. A plan was put together and data quality improved so that an understanding of current performance could be gained and key performance indicators (KPIs) for future performance developed. The KPIs could then be broken down to team and individual levels, feeding into performance appraisals and learning and development. This framework led to objective and fact-based performance appraisals and, coupled with a better understanding of business performance and aims, engaged staff in the improvement process and helped meet both short and long term goals.

Jon Ingham’s paper, “Using a human capital scorecard as a framework for analytical discovery”, acknowledges that human resource (HR) functions have recognized the need to be more analytical, but cautions that there should be a focus on better measurement rather than more measurement. This means measuring what is important, rather than what is easy to measure, and making measurement meaningful so that it can be used to inform real decision making. To achieve this, there needs to be a link between strategy and analytics, and the author puts forward a series of steps to create this link – development of a strategy map that identifies objectives for the people management strategy, then creation of a scorecard identifying measures for these strategies and, finally, selection of the analytics that will best add value to the chosen measures. In doing this, a balanced approach combining the qualitative and subjective with the quantitative and objective is required, so that intuition and creativity are not lost in efforts to achieve better measurement.

In “Measuring human capital”, Angela Baron also emphasizes the link between strategy and analytics. She draws on research into the most appropriate measures of human capital that has been ongoing at the Chartered Institute of Personnel since 2000. The CIPD’s research has led to a number of conclusions, one of which is that it is highly context specific. Employee behaviors and capabilities that are of most value to firms, and therefore are most likely to be measured, are linked to the business needs of the organization, which are determined by its strategy. Although there are certain aspects of people management where data will always be useful for informing management action, because it is context specific there is no single set of universal measures. Many organizations are competent at generating employee data to inform management action, but fall short at creating frameworks in which it can be used for assessment and evaluation. There needs to be a process of assessment and feedback whereby information is accurate, trustworthy and generated in such a way as to be easily implemented and acted on.

Sara NolanE-mail: saranolanshr@emeraldinsight.com