Human Resources Analytics in the Workplace

Human Resources Analytics in the Workplace

Human resources analytics are a compilation of techniques used to analyze and collect data pertaining to different aspects of the workplace in order to make informed decisions and predictions based on calculations from the data collected (Dlomu & Spears, 2015).  These techniques act like a research project from the development of a research design and research questions, to using the correct data collection method and statistics (Levenson, 2005).  One example of where these techniques are used is to evaluate, develop, and manage the human capital of an organization (King, 2016).  Human resources analytics can analyze employee behavior and cost-benefit (Levenson, 2005) as well as help organizations make sound, optimal decisions (Worth, 2011).  Because of its applicability to a wide range of business functions, human resources analytics are used to back management decisions with meaningful data (Dlomu & Spears, 2015).  While it is still an emerging trend making some organizational skeptical about its applicability, other organizations are embracing and utilizing this trend to make informed decisions backed by data.   

One of the biggest advantages to using human resources analytics in the workplace is that it allows the human resources department and management make the best possible decisions backed by data (Kapoor & Kabra, 2014).  Kappor and Kabra also stated decisions made from the information gained from human resources analytics help to increase organizational performance.  Human resources analytics can also be used to predict future aspects of the organization as well as be prescriptive to decide the best ways to meet the organization’s objectives (Kapoor & Kabra).

According to Levenson (2005), one of the problems with using human resources analytics in the workplace is the analysts themselves.  External analysts have the analytical knowledge to perform and interpret human resources functions; however, these individuals do not have knowledge pertaining specifically to the organization.  Internal analysts possess the organizational knowledge of other organizational departments and the analytical knowledge needed to properly perform and interpret the functions of analytics, but lack human resources knowledge (Levenson).  This problem may cause organizations to dismiss using human resources analytics in the workplace because neither outsourcing nor using internal employees for these functions will give the organization an individual who can solely perform these functions.  Creating a team by both outsourcing and using current internal employees could be costly to an organization.  Utilizing these functions may then be seen as a waste of time and money for the organization.

Human resources analytics can affect every area of an organization (Nolan, 2011).  According to King (2016), there is skepticism surrounding an organization’s level of measurement ability, an organization’s ability to use and apply the analytics to obtain the benefits, and the lack of skills possessed by the organization’s employees to interpret and analyze the data.  Although there is uncertainty surrounding the implementation and use of HR analytics, these techniques have the potential to spark investigation into performance improvement for the organization, improve the management techniques of an organization’s human capital, acquire additional resources, and be a viable competitor to its competitors (King).  Several important questions to ask are:

Are organizations missing out of effective techniques due to skepticism and uncertainty?  

Should organizations risk the implementation of human resources analytics to try and reap benefits for the organization?

References

Dlomu, N., & Spears, M. (2015). Better HR decisions with data and analytics. Accountancy SA, 49-50. Retrieved from http://www.accountancysa.org.za/

Kapoor, B., & Kabra, Y. (2014). Current and future trends in human resources analytics adoption. Journal of Cases on Information Technology (JCIT), 1(16), 50-59. doi:10.4018/jcit.2014010105

King, K. (2016). Data analytics in human resources. Human Resource Development Review, 15(4), 487-495. doi:10.1177/1534484316675818

Levenson, A. (2005). Harnessing the power of HR analytics. Strategic HR Review, 4(3), 28-31. Retrieved from http://www.proquest.com

 Nolan, S. (2011). HR analytics. Strategic HR Review, 10(2), 3-4. Retrieved from http://www.proquest.com

Worth, C. W. (2011). The future talent shortage will force global companies to use HR analytics to help manage and predict future human capital needs. International Journal of Business Intelligence Research (IJBIR), 4(2), 55-65. doi:10.4018/jbir.2011100105

Comments

Valerie Barney's picture Valerie Barney | May 15, 2017 2:36 pm MST

 

Human resources analytics appear to be a support mechanism designed to reinforce leader decisions on various organizational issues. A concern you mentioned pertains to the cost involved of creating a team that encompasses both outsourced and internal employees. Has this been researched further? In my opinion, it seems more cost-effective to include both areas of expertise (outsourcing and internal) then outsourcing exclusively. It may cost an organization a little more, but it may be well worth the extra cost to do so if the goals of remaining competitive, improving employee performance, and improving management techniques are obtained. I think it is definitely something organizations should consider.

 

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