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Technology is one of the bedrock components of a maturing people analytics practice. Alongside people and skills, specialist software is a key investment decision. In this article, we look at how technology can improve strategic outcomes from people analytics through intuitive data visualisations and modeling.
In our recent survey of HR practitioners in the UK and US, we found that companies at an early stage of maturity in people analytics tend to make do with Excel and PowerPoint or try to use their HR information system (HRIS) for forward planning. By comparison, companies with a maturing practice lean toward specialist technology to enrich their capability.
One technology to rule them all?
Technology can do much of the administrative heavy lifting that usually falls to HR, such as aggregating and cleaning data, and producing reports. It can automate many basic tasks, giving time back to HR practitioners to focus more on strategic activities. Specialist software makes light work of data visualization and scenario modelling to help with this.
But despite some industry claims, there’s no single system that can do it all. Despite the clear distinction between transactional activities, day to day operational concerns, and the opportunity for strategic work that adds business value, you need to be clear what your priorities for people analytics are when it comes to each of these. Don’t be fooled into thinking you can use your human capital management system for everything.
Enhancing the value of data through technology
From experience, we’ve found there are four key considerations when looking to invest in technology for people analytics. These are data visualization, data modeling, identifying trends and patterns in data, and workforce planning.
- Data visualization. Specialist software gives you many options to visualize and interrogate your data instantly, instead of having to manually build visualizations using more general software. The value is clearly in automation, accuracy, and time saved.
- Data modeling. This takes workforce planning from extrapolations of an organization’s current situation to forward-looking, ‘what-if’ scenarios that show how the organization could change and what the effects would be.
- Identifying trends and patterns in data. Conventional analysis produces insight by cross-referencing datasets, but spotting patterns is still a manual process. Specialist software can quickly highlight patterns and trends in how your workforce is changing and the impact this has on your operating model.
- Workforce planning. When it comes to using people analytics to inform your workforce plan, specialist software can help you understand what your actuals are and what future demand looks like.
Planning for a three-year forecasting period calls for a more strategic approach than your operational workforce plan allows. With people analytics, you can look at future workforce implications by modeling scenarios that show what the business outcomes would be, as opposed to planning for the annual budget cycle.
Being able to perform advanced, visual computations is what sets specialist technology apart from conventional HRIS software. Our research shows that organizations eventually come to this conclusion when basic data tasks take too long and hold them back.
When is the right time to invest in specialist technology?
We’ve found there are broadly two scenarios. Companies with more advanced people analytics skills, processes, and data management see specialist technology as a way to improve their capability even further. Those beginning their journey may decide to buy specialist software early, which leads them to focus more closely on developing processes and refining their data to get the best from their investment.
This raises the question of whether specialist technology accelerates development in people analytics or whether the technology is brought in as capability develops. It’s interesting to consider whether organizations invest in technology as the basis for building capability or whether they get so far before finding their existing technology can no longer support them.
Benchmark insights into people analytics maturity
Earlier this year, we surveyed 300 HR practitioners in the UK and US on six components of people analytics excellence and compiled the findings into industry benchmarks using a maturity scale.
The graphic below shows how the industry rates for technological capability:
Our benchmark data shows that adoption of specialist technology is closely in line with maturity in people analytics. But does your technology choice drive your maturity or are you maturing anyway and pulling the technology through as you need it? Either way, the research suggests you’ll need to use specialist technology to move past average capability.
Changing your technology frame of reference
If you get by using spreadsheets, you might not be aware what specialist software could do to change your way of working, and you assume what you’ve got is good enough. You don’t know what you don’t know, right?
But if spreadsheet programs like Excel were suitable technologies for working with qualitative data such as positions, skills and work activities, we wouldn’t see a high adoption rate for specialist technology. But our benchmark research says otherwise.
If it’s been a while since you considered an alternative technology for people analytics from the one you’re currently using, you might be surprised how quickly your assumptions have become outdated in today’s fast-moving environment.
Rather than a single system for all people analytics challenges, an ecosystem of specialist technologies allows you to bring together your transactional, operational, and strategic activities without one compromising the other.
The next article in the series looks at how to build a healthy data culture for effective people analytics. Many organizations still struggle to aggregate data from disparate sources and maintain the quality of that data. This article looks at the mindset change that’s needed to embed a positive data culture in your HR team and build an effective people analytics capability.
How do you measure up?
To help organizations better understand what stage of maturity their people analytics is at, we’ve developed an online self assessment that measures companies against industry benchmarks.
You’ll be asked 25 questions on six components of capability – strategy, people, data, technology, process, and governance. Once you’ve submitted your answers, we’ll email you a link to your personalized report with scores for each component and recommendations for improvement.