Digitization has swept across every industry not only as a key disruptor, but also a priority topping the CEO’s agenda. At the core of every technology-enabled process and solution is data analytics. While the importance of data analytics is clear to most, HR has proven to be relatively slow in its adoption of data-driven decision-making. It’s true that some progress has been made in shifting the mindset and capabilities regarding HR analytics – but the function continues to fall behind.
Although many HR professionals across the globe are busy drawing a comprehensive blueprint for digital transformation, success seems to elude them. Why? Simply put, they cannot fully grasp and appreciate the enormous potential of analytics and Big Data.
Catching up at the speed of light
In 2013, Science Daily reported that 90% of world’s data has been generated over just the last two years. Once overlaid with Moore’s Law, a 100% growth rate every 18 months, and the super-exponential pace of digitization, the volume of data we’re seeing is incredibly complex and alarming. But for HR, the ramifications of this data is vastly different from any other line of business.
When it comes to decision-making, the HR organization has historically relied on soft skills, gut feel, and qualitative insights. Data consumption has largely been restricted to headcount, resourcing, learning and development, and tracking of employee spend.
At the same time, HR technology is still nascent and rudimentary – with many organizations still managing their data on spreadsheets. Though few have invested in disparate so-called “state-of-the-art” HR applications, piecemeal implementations have unfortunately created multiple data warehouses that do not communicate seamlessly with each other. This fragmented data poses immense processing challenges, increased risk of errors, and herculean efforts when integrating analysis and deriving meaningful conclusions.
Most important, digitization is creating tectonic shifts in the way people work and engage with each other. The very definition of the workplace is changing, and the HR function needs to evolve to remain relevant. In such times, the yardsticks by which the efficacy of engagement, talent development, and the employee life cycle is measured will need to be redefined.
Building the right mindset and skillset
Predictive analytics is a giant leap for HR, and the function requires professionals who are astute in the inner workings between various employee lifecycle events and are proficient in data science, analytics applications, and statistical tools. It is no surprise that HR data scientists are in high demand as they help uncover underlying trends in human-capital data and generate transformative, compelling, and actionable insights that lead to informed decision support. Further, mobile technology is making these insights accessible through all kinds of mobile devices, empowering line-of-business managers with continuous updates so they can make critical decisions in real-time without HR intervention.
Moving forward, Big Data will continue to form the foundation of HR events, and the metrics used to track, analyze, and report them will become key determinants and critical predictors of success. But to be successful and influence critical business decisions, HR will need to put in place the right information, processing systems, and people who ask the right questions.
For more insight on HR tech, see Four Essential Best Practices For HR In 2016.