Key Tips to Support Your Day-to-Day HR Analytics

Data-driven HR is now a must-have for organizations, and data can provide insights and recommendations for many HR functions, including succession planning, retention, and engagement. Organizations that have a documented HR analytics strategy are 45% more likely to score highly in their ability to produce desired outcomes or results (McLean & Company, HR Trends Report 2022; N=301). Despite its growing importance, organizations are facing significant challenges in achieving the full potential of HR analytics since it has not historically been an area of HR expertise. McLean & Company research has shown that only 48% of organizations are developing their HR teams in these types of competencies (HR Trends Report 2022; N=365). No matter if you are just getting started with dashboards and metrics, leveraging analytical abilities, or looking to use advanced technology in HR, McLean & Company offers a series of guides to assist you with leveraging HR data-driven capabilities:

Aside from that, here are some tips to help you get the most out of HR analytics on a day-to-day basis.

1. Start with high-level data cleaning and understanding

A great place to start is by cleaning and visualizing the data. Understanding the high-level distribution of each variable can be achieved by inspecting graphs (e.g. histograms, density plots, box plots). Here, you want to select the right graphs to understand and ensure the accuracy of your data. This allows you to quickly see if your data has any potential outliers, get a sense of any potential multimodality (e.g. having two or more peaks in your histogram), and see where most of your data will fall and in what range. Investing time into data cleaning and visualization at the beginning of the process is worthwhile. This allows you to gain better understanding of your data while leveraging it to its full potential.

2. Keep simplicity and organizational alignment in mind

Data should be used to answer specific/meaningful questions. Having a purpose-driven mindset reduces the likelihood of wasting resources. You need to have business acumen and understand your organization's goals and values to set direction for your final deliverables. Once you have that, summarize and present information in a way your audience can understand with minimal effort. For example, sometimes some simple hypothesis tests can be used as a great starting point before committing resources to more complex, sophisticated models. Just because you can do something fancy does not mean you should; always work with your stakeholders and consider your audiences.

Source: McLean & Company, Become a Data-Driven HR Function Storyboard, Slide 9

3. Seek domain knowledge from subject matter experts

Fresh domain knowledge can often inspire new insights into an old data set or analysis. If you are looking for meaningful relationships between different subdomains (e.g. determining a potential relationship between compensation and DEI), you need a clear mindset regarding the direction you are heading in and to approach the appropriate experts to ask the right questions. Without a clear purpose-driven mindset, it can be difficult for you to determine who to approach for that domain knowledge. Regular project check-ins, dashboard framework reviews, or preliminary analysis discussions make it easier to involve various domain experts and incorporate their knowledge and feedback. Your data is more than numbers; it is all about asking the right questions and having the right level of communication, both in terms of the questions you are asking and how you communicate that information back.

4. Understand data is not magic

It is important to realize that readily available data is not the only source of information. Focus groups, targeted inquiries, and conversations can frequently yield additional information. These forms of information can also be important for making decisions and gaining initial insights on what data to collect. Surveys can point you in the direction of potential areas of concern, but they cannot always tell you why a particular department, location, or result has particularly lower results; more investigation and/or data may be required.

5. Promote the ethical use of data

When collecting data, you must think ethically and be aware of data protection policies and legislation. With any HR analytics projects, communicate clearly and transparently about questions such as what data is being collected, why it is being collected, who can access it, how it will be used, and how it will be protected. This is essential for keeping organizations and employees on the same page. When the project is finished, feedback should be provided on the final product/results (e.g. how the data is being used, what solutions have been found, and what benefits have been gained). These steps will help gain more buy-in for the current project and, potentially, support buy-in for future projects in the form of employee trust in sharing data. The rule of thumb is to be comfortable communicating questions around data. Being ethical and transparent builds trust over the long term.

Call back

In summary, data-driven HR is now a must-have for organizations as HR data can help you understand your people. To help your organization to achieve its full potential, HR analytics professionals should set solid foundations, be ethical and transparent, have a purpose-driven mindset, and ask the right questions to communicate with others. For more guidance on developing data skills as an HR professional visit McLean & Company and see our training offerings: Data Literacy 1: Introduction to Data Literacy, Data Literacy 2: Foundational Data Literacy, Data Literacy 3: Data Interpretation and Storytelling.

Related Content