Why in-house skills are critical for effective people analytics

Attracting and developing the right skills for people analytics is recognized as one of the most difficult pieces of the puzzle to solve. Adequate resourcing requires careful planning to ensure your progress doesn’t stall. In this article, we look at the importance of building capability in-house and the consequences of over-reliance on consultants to cover the basics.

Having the right skills and competencies is fundamental to developing your people analytics practice. This may seem obvious, but the irony is it’s the lack of capability in-house that’s holding back organizations the most. We’ve found through our research that 62% of HR professionals find acquiring the right skills to be the single biggest barrier to better people analytics and the most difficult to overcome.

What skills and competencies do you need for people analytics?

Our research tells us there are four core elements needed to build skills and competencies for people analytics in practical terms. These are resources, talent, focus, and consultancy:

• Resources. This covers systems, technology, budget, and business support. Making the right resources available often comes down to executive endorsement and cross-functional collaboration. However, if organizations have a clear strategy and business case in place, identifying resource requirements will be more planned and predictable.
• Talent. Finding HR people with analytical skills is a persistent challenge, so how do you bridge the gap between these seemingly incompatible worlds. There are three skill groups to consider: analytics including data processing and management; organizational design, covering people, roles, and structure; business strategy and commercial insight to influence decision-making. Assembling a people analytics team can be challenging because it needs people with these very different skillsets to work together.
• Focus. It’s no surprise that organizations often opt for a centre of excellence approach, gathering skills from different parts of the business to build a team. Ultimately, though, you need to make people analytics a core competency if you want to build a high-quality, sustainable practice.
• Consultancy. Consultants can bring expertise and an outside perspective on what you’re doing. But if your entire capability is dependent on consultants, then you’re always going to be reliant on them. It’s likely this dependence will suppress an organization’s ability to build capability in-house. That said, consultants bring knowledge transfer and can bolster progress towards maturity.
• So, it’s a case of working selectively in partnership with consultants. Ultimately, you should own people analytics in your organization and set out what you need to do. If your team lacks certain skills, you could go out to market or you could look to upskill with support from consultants. In fact, this could be an important part of developing your practice.

Benchmark insights into people analytics maturity

When you begin to build capability, our benchmark data indicates that it pays to start with a foundational mix of skills early on. Without this skill base, it’s difficult to reach a level of proficiency, consistency, and reliability to have business impact.

Earlier this year, we surveyed 300 HR practitioners in the UK and US on the six components of people analytics excellence and compiled the findings into industry benchmarks for capability on a maturity scale. Here’s how the industry rates for skills and competencies in people analytics:

Here’s how the industry rates for skills and competencies in people analytics:

Building core capability for sustainable people analytics

By bringing together people with some of the essential skills, putting certain processes in place, and relying on spreadsheets to do the basic work, organizations believe they can build a robust capability in time. But to get proper return on investment, you need to have an established team with a systematic approach.

Mature organizations know that people analytics should be a capability that’s built in-house rather than relying on external consultants. Having the right people using the right tools means you can be forward-looking, strategic, and proactive over the long term.

The next article in this series looks at the third of the six measures of people analytics capability, your ‘Technology’. We uncover insights that show investment in specialist software must be timely and suited to you needs. Throwing money at technology won’t guarantee improvement in capability.

Read next

The next article in this series looks at the third of the six measures of people analytics capability, your ‘Technology’. We uncover insights that show investment in specialist software must be timely and suited to you needs. Throwing money at technology won’t guarantee improvement in capability.