People Analytics: To Adopt or Not To Adopt – What’s Holding Back HR?

It’s almost 2021, and we’re in still working through a pandemic. Most employees are working from home or are dispersed. 2020 armed us with enough data about how people analytics can help this workforce with precision, among other things. So why isn’t people analytics more mainstream? Why is HR struggling with people analytics solutions and why are they still figuring how to make a business case for it?

In 2015, renowned HR industry analyst Josh Bersin wrote that “people analytics is hereOpens a new window ” and that there was a “major shift taking place in the market for people analytics.” But that’s not when people analytics came into the picture. Its journey began back in the early 2000s when companies began realizing the need to effectively process their human capital information.

Cut to almost 2021, and we’re still addressing the challenges with people analytics and why it is not a mainstream technology in companies of all sizes. Any company with 50 employees and above would benefit from adopting a people analytics solution to scale and capture critical employee data. This data ranges from absenteeism to training needs to succession planning.

Merely having a people analytics setup does not translate into results. Knowledge of where to use people analytics, exactly what data to pull, and how to use that data is as vital. So what’s holding back HR?

3 Critical Challenges That Stop HR From Optimizing People Analytics

Visier’s vice president of people analytics, Ian CookOpens a new window , shares with us some challenges that are stopping HR from using people analytics to its full potential.

1. Do we really need it?

Saying people analytics can improve the employee experience is a broad statement, and it is not a convincing enough argument for investment. Establishing its association with the business bottom line, i.e., how it can optimize the workforce and add value and save costs, will be essential.

Cook cites an example. “At a day-to-day tactical level, an organization can only operate safely when it knows which employee worked in which location, at which time. They also need to keep track of who is working, who is furloughed, and who can be brought back to work. While there are systems to record this data, without a competent people analytics function, making the best use of this data will be slow, error prone, and costly.”

Ryan Wong, CEO of Visier, offers another example on the use of people analytics to improve workplace inclusion, “If an employee misses out on mentorship, is overlooked in meetings, or isn’t invited to social gatherings, increased pay or other incentives won’t be enough to convince them to stay. Companies that don’t collect and analyze data related to these fewer formal aspects of work life leave themselves with a major blind spot, one where a destructive pattern can take root.”

Learn More: 4 Essential Use Cases for People Analytics During the COVID-19 Crisis

2. Poor HR–IT collaboration

But Cook tells us, “The data and analytic challenges within people analytics are unique, people data has a completely different structure and lifecycle compared to other areas like operational data or finance data.”

So, when IT becomes an advisor to HR on people analytics, the lack of experience leads to poor output. This, says Cook, is one of the major challenges causing hesitation in investment in people or tools needed for people analytics.

In fact, HR teams need complete ownership of the people analytics function, with a data engineering team on board for data collection and quality control.

3. Complacency

People analytics can be confusing because it is likely that HR professionals or leadership show some resistance and complacency in doing the job.

Cook adds, “Organizations often choose the simplest route, which is to consume the basic end of month reports from their human resource management system (HRIS) and decide that this is ‘good enough.’ These organizations are usually unaware of how uncompetitive their practices are and how unprepared they will be to respond effectively to situations like the COVID-19 pandemic and the recent changes in the SEC’s disclosure rulesOpens a new window .”

(The new rule enforces human capital disclosure by public companies around metrics that include employee attraction, development, and retention.)

Learn More: Top 7 People Metrics to Track as Employees Return to Work in 2021

To Adopt People Analytics Is the Only Solution

If the COVID-19 pandemic has not pushed your organization to implement people analytics yet, it may be time to take the step. Not only to identify how your workforce has been handling remote work but also to identify how to bring them back and how to manage a distributed workforce.

Alongside the basic elements of keeping the people and the organization safe, with a large proportion of every organization now working remotely, all of the processes which relied on a manager’s contact with employees have been disrupted, and in some cases removed.

This means the only effective way to manage people – including pay change decisions, promotions, learning opportunities, and hiring – has to be supported by well-crafted evidence, derived from the people data in the business. The scale and speed of this demand is not served by the canned reports in the HRIS, nor can it be solved with a team of smart people building each piece of evidence by hand.

– Ian Cook, VP of people analytics, Visier

There are more challenges – there are data governance issues and employee privacy concerns. There is the issue of transparency and ensuring employees know exactly what data about them will be collected. There is the challenge of data anonymization and minimization, i.e., collecting only the data you need. But these are challenges that can be seen through with the support of your people analytics vendor. Choosing a solution that enables these functions and updates regularly in order to remain compliant will provide the support needed to meet these challenges.

Cook concludes that “Organizations with strong people analytics teams were those that stood out in the reaction phase of the pandemic. The outcomes they supported kept many businesses functional, both from a people and a financial perspective. This recent evidence should be what an organization needs to ensure it makes the right investment in bringing their people analytics capabilities to the level required.”

Do you use people analytics? If yes, how has it helped you manage a dispersed workforce? If not, what challenges do you face in using it? Share your experience with us on LinkedInOpens a new window , TwitterOpens a new window , or FacebookOpens a new window .