People analytics has become a hot new trend in HR. As markets become increasingly competitive, it’s a company’s employees that can give it an edge.

People analytics allow organisations to figure out what makes employees tick, what will make them happier at work and how to improve their productivity. It can also find hidden skills honed through extracurricular studies or side gigs, help companies recruit the right people and generally improve the employee experience.

That’s where it stands currently, but what of the future? With the amount of data on the rise and new technology such as artificial intelligence (AI) coming into the mainstream, the future of people analytics certainly looks bright.

People analytics still needs to mature

While adoption is growing, this evolution towards data-driven HR comes at a time when people analytics itself hasn’t really come into its own.

According to a recent PwC report, despite business leaders stating that people analytics is important, only 27% of organisations are currently using it for workforce planning. Just 38% use it to monitor skills gaps and 28% use it to reduce bias in recruitment.

There are many reasons behind this, not least because the initial barriers to implementing a people analytics programme can be costly. People may feel uncomfortable and dehumanised when being analysed. HR departments might lack the essential skills to analyse data. That data may be spread over many different systems, from internal messaging tools to payroll, to engagement surveys and apps.

Those challenges are likely preventing some organisations from starting with people analytics. Unfortunately, the same organisations may find themselves in a race to catch up as people analytics gains power and influence.

The rise of the HR analyst

Of course, for people analytics to begin, organisations need to have the right analysts in place to work on the data. Currently, only 21% of HR professionals in the UK feel that they are data-savvy enough to conduct advanced analytics.

There is a skills gap in HR departments that must be bridged - either by hiring a dedicated analyst within the team or using other analytics capabilities within the organisation to help (or external contractors).

Changing data sources

Many HR departments are already used to using employee surveys, performance reviews, colleague feedback and retention/attrition rates as a measure of job satisfaction and productivity. These are active forms of collecting data, in that someone has to go out there and obtain it.

The future may see more passive data collection, using sources that are already within the organisation such as messaging tools.

Wearable technology and the Internet of Things will also be used more in people analytics. Biometric data could provide an indicator of the stress-levels in teams, for example.

However, there is a fine line to tread when it comes to the intrusiveness and creepiness of monitoring employees with connected devices. The Telegraph learnt this lesson after it installed monitoring devices under the desks of its employees. This move was soon reversed after an outcry from its workers and the public.

Senior Workforce Planning Specialist at NASA Stephen Chesley expands on this: “Communication channels will be mined more in the future. This includes message content, tone and frequency… The idea of using all available data (from wearable devices, web crawlers, etc.) is tempting but could cross the creepiness-factor’ line. I hope we don’t move too far in that direction.”

Predicting becomes popular

People analytics, when combined with machine learning, will help organisations predict the future for their employees. HR currently has a view of what’s happening in an organisation based on hindsight, i.e. mainly asking what has happened and uncovering the reasons why.

Going forward, companies will be able to predict what will happen and understand the consequences of certain decisions. It will enable HR to understand the whole employee lifecycle in greater detail. For instance, knowing who to hire in order to boost productivity or predicting the employees who are at higher risk of leaving.

New technology offering new opportunities

AI is becoming more popular and will help eliminate human error when analysing data. It can remove unconscious bias in the hiring process and automate certain tasks such as sifting through CVs. It can help consolidate and clean data, making sure it’s in a useable format - something that’s very important for HR which suffers from many disparate data sources.

Blockchain is another interesting development for HR. Records on the blockchain cannot be altered, therefore can create an accurate profile of employees that shows all their experience, skills and qualifications. It’s more secure than a CV and allows employees to take control of their online profiles.

Applying analytics to this data can help companies match employees with work more effectively, as well as recruit the right people for a role.

Gig working needs better analytics

Incidentally, workforces are becoming less permanent - which makes people analytics even more important for organisations. There often isn’t the same level of engagement and interaction with a transient workforce, so HR may not know workers as well.

Freelancers can be used by one department manager but may not known to others and some may lose contact if the hiring manager they were dealing with leaves the company. Relying on data to match people to projects, track performance and develop employees becomes vital in this case.

Don’t forget the present

The future for people analytics (and organisations using it) is exciting, but businesses should also remember the here and now.

Ambitious plans to use AI will stumble if strong foundations aren’t put in place first. Therefore, anyone planning to use people analytics first need to recruit the necessary experts, gain company-wide enthusiasm for the project and ensure that data is in the right format.

With people analytics, it’s about learning to crawl first, before setting off into a sprint.

Photo by Jacek Dylag on Unsplash.

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