Advanced data analysis provides insight, guides decision-making and supports business performance, but demand for this capability is not being met. How can people professionals rise to the challenge?
In 2018, people analytics was a hot topic for the people profession, with many (including me) predicting it was on the verge of becoming mainstream. People analytics enables people professionals and their major stakeholders to measure and report key workforce concepts, such as performance, wellbeing, productivity, innovation and alignment . Our research People analytics: driving business performance with people data highlighted a growing appetite and interest not just from people professionals, but other organisation leaders, including those in finance and operation functions . For many years ‘HR analytics’ had been labelled ‘emergent’ or ‘niche’, but it appeared to be breaking through. There were promising signs of progress - but there was still some way to go.
Flash-forward to 2020 and the picture looks strangely familiar. Our recently published People Profession 2020 survey with Workday shows that analysis of people data is far from common practice. In fact, the study highlights more work is needed for the profession to fully embrace people data and maximise its potential value.
So what’s happened?
To answer this question, we have to look closely at our latest data. The People Profession 2020 survey canvassed more than 1,500 people professionals in the UK. It investigates various aspects of modern professional practice, including the use of evidence and data, and the ability of people professionals to measure and understand outcomes, and quantify their impact. The new insights provide several important points for reflection.
First, demand for people analytics is huge among people practitioners: 89% of respondents said their organisation intended to use people analytics or people data. This demand drops when we consider SMEs (77%), but it still a sizeable majority. The appetite for insights remains strong, with less than one quarter (23%) saying they do not do any tasks that include people analytics at present.
Second, the level of data analysis being undertaken is largely rudimentary. Just over one third (37%) of current practice involves basic data analysis and reporting, for example, recording headcount or turnover. Very few respondents (6%) noted their organisation has the capability to run more advanced analytics projects.
Finally, measuring the success of the people function using data and analytics appears to be difficult. Almost one quarter of respondents (24%) stated they do not have clear measures of success against which to measure their impact. Without the right outcomes measures in place, it is unlikely that strategic people analytics practice will be possible.
On the surface, people analytics practice seems to be forever on the verge of a breakthrough. At the CIPD we’ve recognised its importance by building it into the new Profession Map as an area of specialist knowledge. Professionals must invest in understanding the wider data and analytics ecosystem and focus on the value it adds to their work.
Our earlier research found a people analytics culture is positively associated with overall business performance. The research highlighted that people professionals can use data to tackle strategic workforce challenges their organisations face, such as workforce performance and productivity issues. By approaching the use of people analytics from the perspective of defining problems – as opposed to seeking solutions – practitioners can realise the full value of internal organisation data in line with the principles of evidence-based practice. It's important the profession invests now to build capability – a major lesson from COVID-19 must be that rapid, high quality analytics is critical to organisations if they’re to adapt to significant crises or disruptions. The COVID-19 pandemic may mean there will be even greater demand for workforce insights, as organisations look to weather ongoing economic instability and uncertainty.
The need for organisations to develop strong people analytics practice is clear. Now is the time to build skills and confidence and work with key stakeholders to define the best approach to using people data. If the people function doesn’t rise to the challenge, others will. Enabling operations or IT functions to drive the development of analytics practices may have short term benefits, but the people profession has the unique knowledge and skills to properly interpret people data ethically and appropriately. If the people profession fails to take the lead, people analytics could lose all semblance of humanity – and that surely is too big a risk to take.
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