Data driven HR is coming – is your team ready?

HR oper­ates in an increas­ing­ly data-dri­ven world, with oppor­tu­ni­ties in recruit­ment, reten­tion and beyond. But to realise the true poten­tial, many lead­ers must upgrade their resources.  

Data-dri­ven HR relies on cap­tur­ing, analysing, and using data to improve an organisation’s deci­sions on every­thing from recruit­ment to employ­ee engage­ment, com­pen­sa­tion and skills devel­op­ment. Done cor­rect­ly, HR data can deliv­er faster recruit­ment, reduced staff turnover and improved lev­els of employ­ee com­pe­ten­cy and engage­ment. 

Today’s HR organ­i­sa­tions have a mas­sive amount of data at their fin­ger­tips. How­ev­er, they don’t nec­es­sar­i­ly have the skills or resources to use it, says Ben Eubanks, chief research offi­cer with human cap­i­tal man­age­ment ana­lysts Light­house Research and Advi­so­ry. “There are very few data ana­lysts in HR,” he says. “But by focus­ing on a nar­row set of tra­di­tion­al HR met­rics you’re lim­it­ing your­self to a pen­cil sketch, when you could be look­ing at full HD.” 

Many HR teams have upgrad­ed vir­tu­al recruit­ment dur­ing the Covid-19 pan­dem­ic, replac­ing inter­views with data-based recruit­ment assess­ment tools. Appli­cant Track­ing Sys­tems (ATS) auto­mat­i­cal­ly col­lect, sort, scan and rank online job appli­ca­tions, and can pro­vide HR teams with access to data like appli­cant demo­graph­ics, source of appli­ca­tions and time-to-hire. 

This means HR organ­i­sa­tions can deter­mine which chan­nels bring the best results and allo­cate bud­gets more effec­tive­ly. One such user is IT ser­vices firm Log­i­calis Group, which is rolling out the Work­day HR plat­form glob­al­ly, replac­ing sev­er­al small­er ATS prod­ucts used in dif­fer­ent geo­gra­phies. 

Access­ing glob­al HR data is huge­ly ben­e­fi­cial in a post-Covid world, says Justin Kear­ney, the company’s group senior vice-pres­i­dent for HR. “We’ve learned dur­ing the pan­dem­ic that many roles can be com­plet­ed remote­ly, so that allows us to open up recruit­ment to cross-bor­der appli­cants and remote­ly assess appli­ca­tions,” he says. “Hav­ing access to bet­ter HR data in recruit­ment means we can tar­get dif­fer­ent geo­gra­phies where we know skills are more read­i­ly avail­able.” 

HR data gives glob­al audit­ing com­pa­ny Bureau Ver­i­tas a strong com­pet­i­tive edge in both recruit­ment and reten­tion, says Trent Cot­ton, the company’s vice-pres­i­dent of tal­ent acqui­si­tion and reten­tion. Cotton’s team faces a range of chal­lenges in recruit­ing qual­i­fied inspec­tors, includ­ing grow­ing com­pe­ti­tion and an age­ing tal­ent pool, with many of the company’s inspec­tors recruit­ed after retir­ing from oth­er firms. 

Cot­ton high­lights first year turnover rate as an impor­tant piece of data. “If we can iden­ti­fy the quick quit­ters that data can be com­bined with ATS data, so we can see where those peo­ple came from and under­stand if it’s the hire source that’s a prob­lem or whether there’s a man­ag­er issue we need to address. Ulti­mate­ly, it helps us retain peo­ple bet­ter and hire bet­ter.” 

As HR teams build data skills there’s poten­tial to use more sophis­ti­cat­ed data tools to gain greater insights, notes Eubanks. “We know most HR depart­ments use some­thing like an ATS, but true data-dri­ven HR means pulling in data from oth­er sys­tems to under­stand the com­plete employ­ee jour­ney,” he says. 

UK retail­er Next Online is work­ing with Arc­tic Shores to pro­vide data-dri­ven recruit­ment insights from a neu­ro­science-based assess­ment that cap­tures 12,000 data points about appli­cants and dis­tils them into scores for 35 dif­fer­ent per­son­al­i­ty traits. 

This data is mapped against a role descrip­tion and used to rank can­di­dates. When com­bined with ATS data it gives a fair­er, more accu­rate recruit­ment process. 

At the start of the project, Next’s HR team couldn’t under­stand why so few women were iden­ti­fied as pre­ferred can­di­dates for tech­ni­cal roles using their exist­ing recruit­ment data. “Once we used our assess­ment to score can­di­dates and mapped that data against the traits the job actu­al­ly required, the num­ber of women iden­ti­fied for one role jumped from 0 to 20 out of 120,” says Robert Newry, CEO of Arc­tic Shores. 

Eubanks thinks the real poten­tial of data-dri­ven recruit­ment isn’t just track­ing cur­rent HR activ­i­ties; it’s antic­i­pat­ing future require­ments and busi­ness chal­lenges that will dri­ve HR strat­e­gy in future. “We need to get to a place where we can use HR data to improve our abil­i­ty to pre­dict future busi­ness needs and make bet­ter strate­gic deci­sions,” he says. 

At Log­i­calis, employ­ee lis­ten­ing tech­nol­o­gy from Peakon is used to con­tin­u­ous­ly mea­sure employ­ee engage­ment. The Peakon data is com­bined with ATS data to pro­vide insights into like­ly staff attri­tion. “We can pre­dict by loca­tion, team and func­tion and that data feeds into recruit­ment plans,” says Kear­ney. “It’s a bit like the Minor­i­ty Report of HR, but I think it has the poten­tial to be a game chang­er.” 

At Bureau Ver­i­tas, Cot­ton is using Google Data Sheets to pull data from var­i­ous HR appli­ca­tions and to share real-time dash­boards with col­leagues. This is a low-cost way to put key HR data in front of col­leagues and helps raise the department’s pro­file, says Cot­ton. “It can show things like future like­ly expen­di­ture, turnover and so on. That data is real­ly mean­ing­ful to my col­leagues,” he says. “I think shar­ing data across the busi­ness is piv­otal in cre­at­ing trans­paren­cy.” 

First, though, organ­i­sa­tions must address the lack of data analy­sis skills in many HR depart­ments — an area where the pro­fes­sion hasn’t tra­di­tion­al­ly excelled. Eubanks advis­es that HR lead­ers take a “build, bor­row, buy” approach to devel­op­ing data skills. “It may be that you have a team mem­ber with a nat­ur­al bent for data and you can upskill that per­son, or you might find some­one in oper­a­tions or finance who can devote some time to work­ing with HR data,” he says. “If that fails, recruit some­one with appro­pri­ate data analy­sis skills.” 

Accord­ing to LinkedIn, there has been a 242% increase on the net­work of HR pro­fes­sion­als with data analy­sis skills. Log­i­calis says it is active­ly look­ing for HR data spe­cial­ists in more mature mar­kets. 

Cot­ton says incor­po­rat­ing more data and data skills is a top pri­or­i­ty for his team. “I love num­bers, but a lot of my col­leagues are sta­tis­tics-averse. We are going to have to be more num­ber-informed, because it blows my mind how much infor­ma­tion HR has and they don’t do any­thing with it.”