March 20, 2019 · Workforce Management,
Business decisions are based on a variety of factors — including brand impact, return on investment, budget, resources, and the like. But how effective these decisions are is heavily dependent on a business’ workforce performance, and that’s where things can get a little more complicated. That’s because employees of all skill sets, ages, motivations, backgrounds, and ranking comprise one of the more complex sides of operating a business.
Hence, it’s vital for any forward-thinking company to have an in-depth understanding of its human capital. A previous blog post here on BizMerlin cites the importance of using the right talent tools that can help employees apply their skills “at the right place, in the right time, and in the right way.” In order to know what tools are appropriate, the company will need to obtain the right data about what their employees need and can gain the most from. This is where people analytics, otherwise known as workforce analytics, can come in handy.
Basically, workforce analytics makes use of employee data to solve business problems. It is an important tool for businesses to utilize because it can help them spot specific aspects in the workforce that need improvements, but may not always be easily identifiable. Because of its immense potential, as well as recent technological developments, this type of analytics comprises a rapidly growing sector. Maryville University’s overview of the business data analytics industry reveals that this type of technology is predicted to have an annual growth of 11.7% through 2020. This means that these tech solutions are the way forward for modern companies to optimize operations, and will continue to be in the years ahead.
In truth, although people analytics is not a new concept, the availability of new technology has been drawing more attention to it. The problem now is not the lack of resources or technology to gather information — it’s that not all companies know what to do with the employee data they do have. In fact, according to Deloitte’s 2018 Global Human Capital Trends report, 71% of companies surveyed consider people analytics a high priority, but only 10% are prepared to deal with it.
In order to leverage analytics for valuable insights that can be used in workforce planning, it’s essential to know what data to collect. The information may be extracted from multiple departments within a company. As a head start, here are several types of workforce data that would be especially useful for business analytics:
1. Workforce demographics
2. Number of positions
3. Salaries of each employee
4. Skills required to perform job functions
5. Company’s strategic objectives
From this data, workforce analytics can help businesses answer the following questions, as detailed on Digitalist Magazine:
1. Workforce Composition – In-depth understanding of a company’s human capital starts with basic information. The workforce composition can be determined from the demographics, the number of employees, positions, salaries, and other related data. From such data, a company can also derive other insights, such as the employee to supervisor ratio, as well as position tenure and job family.
2. The effectiveness of HR Programs – Analytics will be able to give insights on whether policies on recruitment, development, retention, and others bring the company closer to its overall mission. If the results turn out to be negative, the organization can then make the necessary adjustments.
3. Impact of Workforce on Business Outcomes – If the previous two questions are answered properly, which then empowers the data analysts to connect the dots and determine the quality of the workforce and its impact on business outcomes.
The steps to be taken afterward would depend on what insights a company will be able to gain. Remember that the insights to look for aren’t just about the people themselves, but how they relate to business value, too. That’s why some of the common strategies that businesses have undertaken in order to improve their structure involve employee retention, training programs, compensation, and other organizational changes.
In this light, BizMerlin’s solutions can help businesses in terms of collecting valuable data. For instance, it provides tech tools that can easily compile employee records, performance reviews, employee feedback, and even goal tracking. It also offers the service of workforce planning, a process that requires analytics itself. For more information, you can try out the company’s free trial or book a demo today.
BIO: Reese Jones is a data analyst specializing in business analytics. In her spare time,Reese enjoys taking a break from numbers and enjoying sports like football and swimming.