The Dawn of People Analytics
Corporations today admit that ‘people’ are their most important asset. In recent years, we have seen a huge increase in data, giving rise to big data and analytics in the fields of business and strategic decision making. The huge demand from shareholders to bring transparency and pushing to report human capital ‘the most expensive asset on the balance sheet’ and initiatives taken towards optimising performance has given rise to People Analytics. We now see a lot of interest around people analytics that is stemmed from two places; one is the interest of managing the value of our talent and the second, on how we can increase the current performance of our people to optimise growth. However, this all boils down to the fact that how we manage, select and present the right data in a meaningful way in order to make future predictions and decisions.
When we are up against our counterparts from the Finance, Marketing, Sales, Operations and Supply Chain in the board room, the level of language is strategic. There are a wide variety of decisions to be made. So it is important to understand what performance entails, and who is exhibiting it to make decisions about how to manage it in our organisation. Of course, HR should have the first say, however, for us to just speak fluffy words does not do the trick. However, when these words are backed by analytics they make a huge impact on the predictions and credibility of the HR department.
Who is the right person for the job, who should we hire, who should we promote, what kind of career paths make sense within our organisation, what communication and collaboration patters work well, are we providing the right rewards to our people? On top of all this the biggest issues arise around training and whether its working and what is our return on invested talent? What people analytics enables us achieve is to put data behind all our words, to ensure credibility.
People analytics is a field that is currently emerging and has tremendous energy, I would like to transfer some of this energy to the readers of my blog. I have analysing one of the finest Human Capital Management frameworks in the world that has been developed by Dr. Anthony Hesketh at the Department of Leadership and Management at Lancaster University Management School. This framework explores the use of analytics to better understand the impact people can gave on an organisation’s growth. The framework is a cross pollination among the top finance, HR and management professions, i.e. CIMA, CIPD and CMI. ‘Valuing your Talent’ is a simple and effective tool to measure the human capital management capability and enable leaders and managers to understand the direction of travel of their people. Organisations like Microsoft, Xerox, Unilever to name a few are some who have started to take this more seriously.
Measuring human capital initiates a data-driven approach to identifying effective people management practices, which, if done correctly, can assist in starting with People Analytics and ensure that value creation is long-term and sustainable. Nevertheless, there are a host of other variables we have to consider before the implementation of such frameworks in our organisations. For more insights, feel free connect and comment your thoughts below. Don’t forget to subscribe to our monthly newsletter, to hear the latest updates on People Analytics!