Article: How to build an analytics culture in HR

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How to build an analytics culture in HR

As HR takes on the role of a business partner, here's what they need to build a culture of analytics within the function.
How to build an analytics culture in HR

Intuition has both served the organizations well, and at times has also gone horribly wrong. 

Big Data and data analytics have become ubiquitous in marketing, finance and other business streams, and human resources is one field where analytics is still emerging. C-suite leaders and CXOs who have had a taste of the potential of analytics in other business functions, now expect the same from the HR function.

However, one of the greatest challenges that organizations face today is developing an analytics culture. If one has been hearing a lot about digital transformation and managing the change that comes with it, then creating an analytic culture within the organization is the first step.

The development of an analytics culture in HR is necessary because of two major reasons: 

  1. Adoption and use of the digital technology is going to be the norm in the future and businesses will not be able to do without, and 
  2. As consequence of the first, HR is fast emerging as a business partner for the CXOs of the organizations.

Here’s how HR should build a culture of analytics:

  1. Closing the analytics capability gap
    Many organizations are already making huge strides towards creating an analytics culture in their organization. And before
    embarking on that arduous journey is the realization that there is a capability gap which exists in the organization, and this could be in terms of meeting the operational requirements of business or even future growth. 

  2. Establish strategic intent
    Successful organizations around the world acknowledge that HR analytical capabilities cannot be built overnight and which is why they chart out a systematic journey with measurable goals to achieve a technological state within the HR department, and consequently within the organization,

  3. Define the problem statement and make data relevant
    Only 15% business leaders have changed a people decision based on HR analytics. s, traditionally Clearly, HR professionals have always been dependent on data (in averages) that has only led to general conclusions but not actionable insights. 

  4. Generate excitement and communicate
    When HR makes decisions they automatically impact the workforce, but not necessarily do they lead to much excitement. Communicating the benefits of the change is the key

  5. Turn HR professionals into ambassadors
    The best of the organizations offer education and training to the HR professionals, and they convert them into ambassadors into their cause. This is be done by providing the relevant information and courses in a byte sized format, and then in the long term ensuring that threading all the courses together, they have developed a learning path for the HR professional.

AHLC Enhancing Learning Capability

What should be the focus?

Capability building should be focused on first creating the analytical capability and then ensuring that it sustains over the long term. The best of models focus on the four key competencies which need to be developed: data, analytical acumen, technology and action. 

  1. Data: This involves the understanding of the HR data. This involves both the curation of data and also the predictive analytics involved once it is curated.
  2. Analytical Acumen: This is more focused on generating the most relevant business questions and analyzing the trends.
  3. Technology: The ability to learn to work on and navigate the workplace technology. An expertise in this could lead to faster generation of insights through analytics.
  4. Action: Analytics should lead to meaningful outcomes and consequently aid in decision making. Here the HR professionals should develop skills in analyzing the impact of key variables and what do they mean in a ‘business context’.

Changing the HR lexicon

The HR function needs to elevate itself to a stage where it has developed the capabilities which could lead to the use data centered language in the boardroom meetings. But to reach that stage in the organization’s growth, it is required that the HR professionals are educated on a sustained level about not just the fundamentals and benefits of analytics, but also on curiosity and the willingness to use technology to generate the most meaningful insights. Certification programs such as Certified HR Analytics Professional by Aon Hewitt Learning Center can help practitioners to focus on apply critical thinking, uncover insights, leverage visualization and institute a data driven culture in the organisation. Focusing on business impact and upskilling self could lead to the much desired HR interventions in business processes dependent on ‘people data’.

This article is curated by Rhucha Kulkarni

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Topics: Learning & Development, HR Analytics

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