HR analytics
New Insights, New Roles

Big data is hype. AI is for the movies. A computer might be able to beat the chess or Go world champion—but HR requires a subtler touch, right? Well, hang on. Even simple off-the-shelf analytics can generate real insights into people, productivity, and profits—insights that cement HR as a strategic advisor.

Implementing these systems (and understanding their limitations) should already be on the to-do list. Smart HR leaders also need to keep an eye on the next leap forward. Machine learning, natural language processing, sentiment analysis, and behavioral economics are going to become essential parts of the HR systems vocabulary.

This digibook is a roadmap to insight from analytics and essential advice for working with IT, management, and employees to lay the foundations for the future of HR.

Further reading.

If we seem to be missing three big-ticket items, it’s because they’re covered elsewhere in this series. Check out our three digibooks on Career Management and Development, Managing Organizational Culture, and HR Transformation.

Who will find this digibook useful?

HR leaders. The technology to understand data is developing fast. As sources of data proliferate—from enterprise systems to social media—our ability to understand people is moving into new dimensions. Analytics can put you ahead of this wave—riding it, not being submerged.

C-level execs. The new generation of database tools, data-gathering systems, and analytics, underpinned by emerging artificial intelligence technology, is going to give you more visibility of, and more insight into, your people than ever before. If you need to act fast, HR analytics will tell you where, how, and what the effect will be.

Line management. No technology is going to replace the judgment of a good manager. But the more you know about your teams, how they rate against benchmarks, how they feel, and what they care about, the better you can guide them to new territory. HR analytics can be your compass: Who’s doing brilliantly, how can you optimize their performance, and what’s the action plan for the laggards?

How far is too far?

Avoiding “the creepy line” with employee data.

The percentage of companies fully capable of developing predictive models in HR rose from 4 percent to 8 percent in 2016. Last year, only a quarter of companies felt ready for analytics. That proportion is now one-third.

But get this: Three-quarters of executives surveyed now rate people analytics as a key priority.1

The message? The race to better analytics is on!

We are all now “quantified beings”: constantly monitored, our preferences stored, our decisions mapped out. Algorithms—complex equations—crunch our data and tell businesses what to sell us, how to talk to us, what we think, and what we’re going to do next.

And thanks to enterprisewide systems and HR analytics, that’s now true inside our organizations, too.

The workflow for analytics is simple (we’ll come to the potential bumps in the road shortly):

Figure 1: From data to insight in six simple steps

What sort of questions, then, might HR analytics answer?

Efficiency HR Strategy Business Planning
What are the turnover trends across the business? Are we rewarding our high performers properly? What would expansion into new markets mean?
What’s the return on our wellness program? Is there a viable pipeline for leadership positions? How do we design teams for better productivity?
How should we be allocating L&D spend in five years? How should we redesign our recruitment processes? How do we raise levels of customer experience?

The creepy line.

An all-seeing HR function with the analytical capability to create insights from every aspect of an employee’s life risks crossing “the creepy line.” That’s what ex-Google CEO Eric Schmidt2 called the point at which people feel stalked by their technology.

Consider these five areas—all perfectly natural tools for HR and the business to deploy today:

  • Biometric tracking of employees
  • On-premises video surveillance
  • Worker-productivity tracking
  • Social-media monitoring
  • Employee-engagement programs (with opt-in models)

The problem is that they might also be perceived as intrusive or even oppressive by employees.

In fact, by 2018, half of business ethics violations will occur through improper use of big data analytics, according to a report from Gartner.3 Understanding your employees without scaring them requires constant self-awareness from the HR team.

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