Why People-Oriented Analytics Are More Important Than Ever

Why People-Oriented Analytics Are More Important Than Ever

In the simplest terms, a human resources department is about supporting the people in your organization. But running an HR department, or these days often titled “People Team”—especially now—is anything but simple. For starters, you must be a soft skills (or as we at Udemy have recently renamed them: power skills) master. But if you rely onlyon power skills (which, let me stress, are key), then you are living in an antiquated Mad Men past, leaving far too much people management to chance, ultimately risking the well-being and growth of your employees and organization.

Enter the field of people analytics, a specialty that collects and applies data-driven insights to improve hiring decisions, enhance employees' work life, and introduce better workforce processes that ultimately connects people strategy to business strategy.

A people analytics practitioner and leader knows how to use technological tools that take much of the guesswork out of smart people management. These software platforms and tools are invaluable in improving decision-making by providing objective analysis of any HR situation. But these tech tools won’t get the job done on their own. Great HR employees must invest time in learning how to use data analytics tools.

For example, by using data, people analytics can show leaders the investment needed for a new hire to be onboarded and fully productive. The data can even give insights into why a company has high turnover. It can also shed light on whether learning and development programs are effective, or tell you what factors influence the decision to leave within a year, or two years, etc. Knowing how to make use of this unbiased data will save your company energy, time, and money.

In this interview, I talk with Dr. Tyrone Smith, Jr., Udemy's director of people analytics, to shed more light on the skills a people analytics professional needs to succeed, and why this emerging area of HR is so critical for building a successful 21st-century organization.

Why are we hearing so much about people analytics now?

Smith: While the people analytics and/or data science discipline may have been around sometime, it has definitely accelerated during the pandemic. Understanding how people work, the best ways to communicate with them, and the increased value of teamwork and empathy have been huge drivers changing the business landscape during the pandemic. We are now at a stage of redefining the discipline. Analytics goes beyond reporting. It is more than simply presenting facts or figures, in other words, because people analytics offer insight into what the data represents and how it can be used to better the employee experience. From tailoring learning and educational programs to match employee skills and strengths to providing insight into common pain points in the business, people analytics can help create a highly tailored employee experience. That is why, in this new era, many organizations are adopting people analytics as a business imperative to focus on delivering value to the business by looking for patterns at scale around talent in the workforce and linking it back to the business and people strategy.

With all the shifts happening in today’s labor market, there's a new focus on analytics to help organizations keep their talent practices and pipeline strong. This is so important since an organization's people are the center of everything. Analytics also help improve the ways organizations identify, attract, retain, and develop talent. The decisions being made are shifting away from intuition and becoming far more data-informed, which lets leaders unlock the power of their people. The outcome is a data-informed culture that dramatically helps minimize biases and ultimately improves performances.

Why are these people-oriented insights more important for organizations and for leaders than ever before?

Smith: From the Board to the CEO (chief executive officer) to the CPO (chief people officer), leaders are being asked to have a deeper understanding of their workforce that is dependent on hard evidence. How are they responding to this whole new way of working around hybrid or remote work? What about creating a diverse workforce? How does this tie back to the skills needed to execute against your business strategy? With all of these questions, people analytics can have a positive impact on the bottom line. These conversations have even been elevated to the board level as organizations recognize their importance.

People-centered leadership takes people analytics and uses them to better not only the organization’s strength and productivity but the employee experience as a whole. Organizations are acknowledging that people are their most important asset. This is especially true as more people are now looking for new positions, flexibility, and new ways of working that have not always been traditional.

How can those in HR analytics impact talent attraction and retention?

Smith: People analytics is key to leveraging data to drive action and should always seek new ways to drive value and impact to the organization. However, one must understand the problem and clearly think through the potential solutions before jumping into the data. This experimental design can help you identify the directional data needed to help answer critical questions in the employee lifecycle, from retention to workforce trends and practices that include compensation, pay equity, inclusivity, diversity, team dynamics, performance, etc. Also, analytics can evaluate many scenarios, including talent acquisition effectiveness, by measuring the quality of hires and tracking if they were hired through promotion or internal mobility. These insights can be illuminating as to whether employees are moving in the organization into different roles and how leaders can align employees' talents and skills with what the business needs.

In terms of technology, companies using legacy systems may be falling behind. Organizations using HR-designed technology solutions and automation may vastly help improve processes around everything from talent acquisition to the preselection process, and so on.

What kind of background or training should someone have to enter this field?

Smith: As an emerging field, we’re seeing people of all backgrounds moving into people analytics. I didn't come into analytics from a linear track – I moved through accounting, finance and IT before finding my passion for this space.

Some in this field are more technically focused like data scientists and analytics specialists. Some come from a variety of different backgrounds, for example, industrial & organizational (I/O) psychology, HR, economics, finance or organizational development (OD). However, the key to value is being able to translate data themes into insights that connect to organizational trends and behaviors to drive action.

What advice would you offer someone who is just getting started in people/HR analytics?

Smith: First and foremost, speaking as someone from the lens within an organization, learn as much as you can about analytics: take online courses (Udemy). Then, understand the key business priorities for your company. Finally, spend time getting to know your teams and leaders– identify areas where having more data could help with decision making. This is where people analytics proves real value and it will help you shine in your role.

What resources can people turn to learn more about this field and the skills needed?

Smith: There are so many great resources out there and people analytics is a great space to be in for continuous learning. To find out about the technical side, learn or get exposure to languages such as R, SPSS, Python, Artificial Intelligence, machine learning, and different HR technology or people analytics software on the market. I would also encourage individuals to stay plugged in and continue to monitor the future of work trends that may be impacting the workforce like extended reality (XR), organizational network analysis, etc. You can also follow thought leaders in this space by listening to their podcasts, reading their articles or books, and following them on LinkedIn. Just to name a few thought Leaders I admire in this field are Josh Bersin, John Boudreau, Alexis Fink, and David Green, etc, who have either spoken and/or published a variety of content and resources on people analytics.

HR/people analytics has evolved so quickly just in the past couple of years. Where do you see this field evolving in the next few years?

Smith: I think the future of people analytics will be wholly reimagined. Even now, storytellers, product owners, and data analysts are coming together to explore the benefits of the human-organization connection and people strategy. I also believe the next wave of senior HR leaders and chief people officers will come out of the people analytics domain.

The organization of organizations is quickly changing, with new technology giving rise to new power structures, and changing needs. People analytics and the traditional “HR” department must evolve along with the people it serves in order to push the field forward.

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