When it comes to HR analytics, one rising trend of late is that of People Analytics. As the name implies, this involves talent data, performance reviews and other information regarding the individuals working within an organization and how it directly impacts business outcomes.

People Analytics is gaining in popularity amongst HR departments, shift leaders and more. It helps them meet goals, identify employees contributing the most effectively and generally improve performance across the board for cost savings and greater efficiency.

In this article, we’ll introduce you to the world of People Analytics, including:

  • What People Analytics is
  • What benefits it can offer
  • How it can help HR teams and business leaders alike
  • How to implement People Analytics in your company
  • Finding the tools to enable People Analytics

What is People Analytics?

People Analytics refers to solving business problems or improving business outcomes through workforce analytics. In other words, it involves analyzing data gathered from other departments. This ranges from internal HR systems, though to systems used in other departments and even external tools, such as employee surveys and salary data. All of this data can be used to gain actionable insights and drive changes through data driven decisions.

More specifically, People Analytics can be used for company-wide business data, such as improving hiring processes, organizational efficiency, as well as improvements at individual levels. People Analytics can help teams to identify employees with the most potential, improving employee retention and performance management.

Other areas of People Analytics can include:

  • diversity, equity & inclusion
  • employee satisfaction and understanding the organizations identify as seen by the workforce
  • Talents, skills and internal development
  • Cost efficiency

And that’s just to name a few. We’ll discuss more of these areas of People Analytics in the sections to come. As you’ll soon see, people data is too broad an area that accurately summize is just a few words!

The 4 types of People Analytics

It’s also important to note that People Analytics is a very wide area, and there full of deep potential. In fact, we can broadly separate People Analytics into four key areas. Ranging from the most commonly used to the least utilized, these are:

  • Descriptive analytics: This form uses historical data to assess the results of past events and help you learn from them. However, it’s not going to predict future events. This is reporting in its purest and most simplistic form.
  • Diagnostic analytics: A step above descriptive analytics, diagnostic analytics aims to explain events, finding both trends and anomalies in the data, as presented to the end user.
  • Predictive analytics: At this stage, People Analytics starts to use historical data to predict future successes, providing estimates to help in decision making.
  • Prescriptive analytics: With this form of People Analytics, we’re not just predicting future probability. Instead, we’re using People Analytics to recommend the best course of action to achieve a goal.

To get the most out of People Analytics, we recommend aiming for at least some level of predictive analytics. However, even with diagnostic analytics, skilled HR teams can work with the data and insights given, working on improvements and solutions without having to manually shift through all the business data themselves.

People Analytics vs HR Analytics

At this point you may be wondering if People Analytics is the same as HR analytics? In truth, they are closely related, but distinct in that the former, People Analytics, has a greater emphasis in understanding the impact of employee experience and performance in business needs. HR analytics, in contract, is focused on ‘hard’ data regarding resources and processes.

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Both are forms of workforce analytics and both have their place in modern business. It’s worth understanding the difference, as both workforce analytics tools can be used by various teams and business leaders in the organization.

Benefits of People Analytics

Now you know what People Analytics is, let’s go through the main benefits of People Analytics. These are the biggest benefits that you need to know of, and the areas that separate People Analytics from typical HR analytics processes and solutions.

Evidence-based HR

First and foremost, People Analytics constitutes a form of evidence-based HR, in that it uses employee data to make decisions, rather than just individual feelings. This leads to more objective, data driven decisions, which is both better from the company from a decision making stand point and a legal perspective.

A focus on talent data

Knowing where critical talent lies in your organization, and then utilizing these skills in the most critical areas, is a huge boon. People Analytics in this way helps HR teams meet the needs of their business leaders as effectively as possible.

Internal development

Unlike other forms of HR data, People Analytics can help show which employees are useful in which areas. Rather than just raw data on task completion, a People Analytics approach looks at where each employee shines best, what development options can best help them (and thus, the company) and how to essentially gain the most from each individual.

Reduce employee turnover

HR departments not only need to improve critical talent, but also retain employee engagement and keep people as long as possible. In this way, similar to internal development, People Analytics can uncover where problems lie, helping to solve them before they become an issue. Alongside improving employee engagement, by implementing the received data into a wider People Analytics strategy, such a use of workforce data helps HR departments to retain critical talent.

Quick decisions

Having access to real time data – especially if you’re using People Analytics tools with real time dashboards – helps HR professionals to make similarly quick decisions. This is significantly faster when compared to traditional, manual forms of ‘talent analytics’, such as monthly or even quarterly performance reviews.

Improving organization strategy

People Analytics has some key strategic value in that it helps businesses view how they implement people within the processes and departments. Do teams have enough people? Are individuals being assigned appropriately? Can processes be improved through the redistribution of workers? These may seem like complicated questions, but unlike other forms of HR data, it’s the individual-focused nature of People Analytics that can answer them.

Cost savings

Implemented well, People Analytics can show how workers, both individually and in terms, are working to perform tasks and complete goals. Not only that, but it also improves recruitment processes through better people data and hiring management, helping smaller teams to accomplish more in as small an amount of time as possible.

How does People Analytics work?

There are a range of People Analytics tools available and, while each certainly differs in features and functionalities, there is a general process that can be followed. You don’t need a team of data scientists, either. If you’re familiar with the general data collection and analysis, getting started with People Analytics is much easier than it might seem.

Prepare your organization

If you’re not familiar with implementing data driven insights into a business strategy, it’s worth investing some time into preparing key managers and business leaders within the organization. After all, a People Analytics solution can deliver meaningful insights, but if the HR professionals given access aren’t aware of business goals and how to use data to meet them, it might not deliver on its full potential.

This could include simple training on how to analyze data, or even determining what the very goals are for the organization. What are the key challenges, what are the most urgent issues and what metrics or KPIs should be improved?

Gathering people data

Every data process starts with data collection. When it comes to People Analytics, you need to identify the raw data that can help generate the insights you want. Then, you can use People Analytics platforms to integrate them – typically via API – to start the data transformation.

Examples of People Analytics data sources can include:

  • Recruitment tools and processes
  • Client Relationship Management (CRM) software
  • Employee demographics
  • Payroll tools and data
  • Performance and task data
  • Surveys and employee engagement tools
  • Absence and time tracking

This list is far from exhausting, but we hope it gives you some insight into the potential of People Analytics in a data driven culture.

Note: As we’ll discuss later, it’s important to remember that many of these needs can also be met by People Analytics tools. If you don’t already have software for easily collecting these data points, then don’t worry!

For more advanced HR metrics, you can also consider external data,such as labor markets, social media (such as LinkedIn) and other local data for your regions.

Data analysis

Okay, so now you have all the data points and sources, so what do you do next? Naturally, the next step is to go through the gathered data.

How you analyze data will depend on the People Analytics solution that you choose to implement. A wide array of data reporting features will influence how your teams are able to view data. For example:

  • At a simple level, data visualization can give leaders key insights into employee performance, using real time data to track performance across the entire organization.
  • Alongside being able to visualize data, you can also use the gathered data to determine which tasks, teams or projects are meeting business goals the most efficiently… and which need the most improvement.
  • For more advanced analyses, machine learning functions will be essential. Remember that, in our earlier overview of the 4 types of People Analytics, we can consider both prescriptive and predictive analytics. The best way for Human Resources teams to achieve this is to implement AI to advise and project.

What features you need will greatly depend on what business outcomes you want to achieve, or challenges you wish to solve. This is why the previous step focused on identifying those needs, so that in this stage your HR departments can start developing actionable insights to meet them.

Starting People Analytics projects in your business

Now we’ve discussed the potential of People Analytics, its benefits as a form of HR analytics and how the overall process works, and how you can get started in your company. As we just discussed, you first need to develop your HR departments or other leaders to ensure that data analysis and information-heavy decisions become a common standard.

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Next, businesses need to make practical choices. Namely, this involves introducing a chosen People Analytics solution and ensuring relevant people in the organization have both the access and skills to make the most of this new wealth of employee data.

Do you need data scientists or People Analytics teams?

In short, you don’t need data professionals to implement People Analytics. With the right tools and set-up, HR teams and specialists should be able to act independently and utilize such processes as part of their ongoing HR or talent analytics operations. In fact, this independence is one of the key People Analytics trends.

In a perfect world, an in-house team of data scientists could deliver incredible actionable insights, but we understand the challenges of modern businesses in maximizing efficiency. As we’ll get to in a second, the best People Analytics software options are designed to be easy to use, so that existing teams can work better, deliver results faster and essentially do more.

Choosing the right People Analytics tool

The best and most user friendly way to implement People Analytics is with a dedicated HR analytics tool with the necessary features for your business.

For example, we can look back at the four levels of People Analytics and map this to essential features:

  • Descriptive analytics: At this most basic level, your HR analytics solution is providing information on performance, completed tasks and matter-of-fact reporting from a basic dashboard.
  • Diagnostic analytics: To gain actionable insights, your People Analytics tool needs to at least offer dashboards with generated insights, summarizing key info, ideally with clear data visualization.
  • Predictive & prescriptive analytics: This stage is where advanced analytics start to come in. Such People Analytics tools should implement machine learning or AI in some way, showing you the potential results of considered actions. Shift scheduling is a key example – by predicting demand, advanced tools can help you best fill upcoming shifts to meet predicted needs.

On top of the above, you also need to think about your data collection needs. If you don’t have existing systems for People Analytics tools to connect with, you should consider the native data collection tools built into any proposed solution. This, combined with the previously described needs will help you find the ideal tool for you.

For instance, Movo People Analytics Software offers AI powered labor forecasting and integration with solutions such as your existing payroll systems. However, it also has a supporting mobile app for employees to click in and out of work, dashboards for tracking teams, tasks and shifts, and a suite of inbuilt employee engagement and advancement tools. This already provides a range of talent data that HR leaders can use straight away to gain insights and take action.

People Analytics: a powerful tool for business leaders looking to solve organizational challenges

As you can see, there’s good reason behind the growth of People Analytics in HR and team leadership. As both a data analysis approach and general methodology, implementing People Analytics is a great choice for companies looking to make data driven decisions as much as possible.

It makes clear sense too: there’s no better HR data than people data. For those responsible for managing employees and gaining the best value from a given workforce, it’s time to get started with People Analytics.

And, as we’ve shown you, it’s nothing to be afraid of either. Modern People Analytics solutions are easy to use, integrate well with existing HR systems and can quickly get HR professionals up and running with a wealth of insights and strategic actions.

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