What is People Analytics and Why Use Data to Manage People

7 of October, 2022

Human capital is the most valuable asset of any company. However, to make the most of its potential, a thorough understanding of the workforce is essential. In this context, people analytics appears, known as one of the trends in the world of human resources; precisely for this reason it is also called HR Analytics. People Analytics is a methodology born from the rise of new technologies that is gaining more and more supporters. Knowing the advantages of the use of data in the HR field explains its success. Keep reading to find out more.

What is People Analytics

In a purely academic sense, people analytics is the systematic identification and quantification of the people who drive business results. This is how Heuvel and Bondarouk defined it. In other words, it is a research method that analyzes workers from data. The aim is reaching objective, valid and reliable conclusions. These results should be the basis for decisions made by corporate management.

With the use of data in human resources, we can predict the future of companies, which allows managers to introduce preventive measures that saves time and money. People analytics combines statistics, experimental designs, the identification of relevant questions for the company and the use of adequate data to answer them or the use of scientific criteria to evaluate results. Keep in mind that, this methodology goes far beyond simple data collection. A company can collect endless data from its workforce through human resources. However, if they don’t know what to do with this data, it’s useless. Therefore, it’s essential that the human resources team is clear about what they want to find out. And most importantly, they should choose the right questions to ask and design the fundamental HR reports.

Benefits of People Analytics

After knowing what people analytics is, the main advantage of using this tool is that it makes sense of the use of data in human resources. Thanks to analytics, we can identify patterns. Moreover, it offers a large number of options when it comes to classifying and segmenting the information obtained.

One of its strengths is that the wide variety of questions it solves allows you to investigate any aspect related employees. Although, it’s use is almost always for recruitment, training, loyalty, compensation and organization.

The use of data in human resources favors more efficient management of the company’s human capital, based on real data and not on assumptions. In addition, it allows you to monitor strategic decisions in almost real time and to introduce the necessary corrections. It helps identify areas for improvement and saves time on administrative tasks in favor of more important ones. Productivity improves thanks to the well-being of the workforce.

Recruitment of workers

When it comes to attracting talent, the company has information about the candidates thanks to their CVs. What people analytics does is build a statistical model from similar resumes and job progression of workers to find the right talent. To do this, the system must respond to the personal and professional characteristics when filling a vacancy.

Talent development

Employee training is key to keeping them updated and developing their skills. In this sense, knowing what people analytics is; allows the human resources team to identify the appropriate training for each employee. This will reinforce their skills and boost their performance. Looking forward, it is interesting to draw a comparison between the pre- and post-training evaluations to discover which teachings have been more beneficial.

Talent retention

Just as people analytics allows you to attract talent, it is also a very interesting tool to monitor workforce motivation. Are there any signs of workers losing motivation or wanting to leave the company? If so, actions should be taken to avoid talent loss. We can use the data to implement benefits programs for workers that will reinforce their satisfaction and prevent them from leaving.

People Analytics in compensation

It analyzes the salary offered to staff members. Mathematical models can explain how a change in salary conditions will influence employees. A salary increase, a cut or even the introduction of flexible compensation will have one or another effect. It is important to analyze all the scenarios before making decisions.

Organization

Finally, the analysis of data in human resources allows the company to know the relationship between workers beyond their hierarchical positions. Something as simple as the flow of emails lets you know if the communication is good or not.

Taking all this into account, it is not surprising that more and more companies are betting on People Analytics in the management of their human resources.

It cannot be overlooked that companies do not lose relevant data. If they are stored, they will always be available, so that they can be used for new analyses or to compare the results of changes made.

Sesame’s HR software will play a fundamental part in knowing what People Analytics is, as well as its internal management within companies.