Data Driven HR
Data Driven HR (DDHR), means using data intelligently and deriving valuable information (insight) to make decisions that not only improve the performance of people within the company (including the HR function), but also contribute to the overall success of the organization.
DDHR uses well-established, scientific analytical methodologies and tools, used primarily to study market, customer, and process efficiency.
Today, almost everything we do generates data. When we turn on our computer in the office, make a video call, write an e-mail, book a trip or buy online. The world around us is becoming more and more intelligent, interconnected, data-rich.
Although the HR function is among those that have the most data at their disposal, a Data Driven approach is not common in our organizations, outside of perhaps the largest and most innovative companies, but it is rapidly gaining traction because it brings organizations a tremendous competitive advantage.
Evolution of the HR Team
The role of the HR team is rapidly evolving in the unstoppable digital transformation (Digital Transformation).
It is shifting from repetitive, time-consuming, administrative and legal tasks to a deeper understanding of what the business needs to achieve its strategic outcomes.
Standard metrics like absenteeism or training hours, used because they are simple or because everyone uses them, are no longer enough: we need to find much more useful indicators specific to our business.
With the right insights, for example, we can make better decisions about staffing and governing change in our company, make HR processes and operations more efficient and effective, and improve people’s overall well-being and impact. All of these factors have a significant impact on a company’s ability to achieve its goals.
The data-driven approach is transforming the entire HR world, albeit at different speeds, from recruiting to measuring performance to giving and receiving feedback from employees, managers, and colleagues.
HR needs to know how to mine, manage, and process data for more compelling, fact-based answers.
DDHR and Business Strategy
The saying goes “no wind is favourable for the sailor who does not know which port he wants to land in, ” which is why the questions to seek answers to through Data Driven HR methodologies are those that are important for the realization of the company’s overall strategy and useful for the achievement of strategic goals.
Let us assume that the company’s goal is to create more closeness with its employees and that it therefore wants to improve the effectiveness of communication. Doing a demographic analysis of the company’s population can give us interesting insights into the technologies most used by different generations and use them to reach our people.
Or if we need to grow sales without linearly growing facility personnel costs, it is worthwhile to understand in detail the characteristics of those in our sales network who are making a difference.
Simplified Data Analysis
Until a few years ago, using software for statistical analysis was very difficult, even impossible for non-experts, but there is great news.
The amount of data is increasing frighteningly, but the tools for analyzing it are becoming easier and more intuitive to use.
With the advent of Business Intelligence (BI), data analysis is moving out of a highly specialized context to be successfully adopted by HR.
Putting the HR Function back at the center
Data analytics is a powerful tool for describing, understanding, and communicating situations, trends, and phenomena concerning people within the company.
Traditional HR competency-based approaches such as culture, training and development can be enhanced and made more objective, transparent and clear.
Finally, data analysis and insights create a common language with other business functions. This opens up new possibilities for enhancing the HR team, which must be able to effectively communicate the results of analysis. In this way it can “hit the mark” and add value to the organization.
Data Driven HR is a very valuable opportunity. Not only for HR but for the entire organization that wants to make a difference through people and achieve competitive advantage.