Why does a person in a similar role outperform the others? Why are some people good team players and some individual contributors? How do organizations decide what makes good managers and further on good leaders? How well do organizations truly understand what drives performance? Why certain leaders thrive and others flame out? Can we accurately predict whether a candidate will really do well in our organization?
The answer to most of these questions is ‘don’t know’. Most recruitment, performance and rewards decisions are made qualitatively – through a combination of gut feel, personal experience, and corporate belief systems.
The time has come to reduce the subjectivity. This calls for scientifically designed systems and processes backed by information & knowledge. In today’s parlance, this information stems from Big Data. Data and talent analytics together helps organizations take informed decisions, minimizing qualitative evaluation and subjectivity.
The importance of big data has been all-pervasive touching all aspects of corporate functions and it is no different with human resources. Here are some reasons to why HR should adopt analytics:
- Better Recruitment Practices
A quick check with some of the HR managers revealed that many of them rely on gut feel when it came of hiring. While intuitiveness is good, it is more important to back it with data that a manager can use to avoid a bad hire. A survey from CareerBuilder found that 27% of employers believed a single bad hire could cost them as much as $50,000. Reduce the possibility of hiring the wrong person for the job, and you can save the company significant amounts of money in the long run.
- More and better insights
Talent analytics serves as a window into employees’ professional lives. By tracking, analyzing and sharing employee related data like employee demographics, employee satisfaction surveys, team assessments, and performance related data, HR gains more insights on employees. It is possible that by applying the insights obtained, employers can identify top performers, along with stragglers. Scientific remedial solutions like training, coaching, skill development etc. can be then suggested.
- Better retention levels
As we mentioned earlier, the cost of replacing a good employee is high. A significant advantage of using data is to understand what works within a workplace and what does not. Talent analytics can throw up information on why employees leave and why they stay. Apart from the tools mentioned before, and with the addition of data from employee engagements, exit interviews etc., HR can avoid attrition by taking informed decisions on the same.
- Relevant training/ coaching
Training programs are typically designed with a ‘one size fits all’ strategy. While we are not against this, not all training programs are relevant to all employees; programs have to be designed based on individual capabilities.
- Optimum utilization of funds
With talent analytics, not only is it possible to analyze employees profiles but it also helps measure the effectiveness of training programs. It can make sure that employers are making correct and effective investments. The intention in most cases is to optimize what the company spends on its people.
The bottom line: big data can help organizations gain more insights on existing talent to better retain and train their valuable resources.
(This was also published as an article in Impact - the Pearson Talentlens Newsletter)