What is Human Resources Analytics?

The career field of human resource management (HRM) is well-known for its application of communication and other interpersonal skills, but recently the business function has focused on using more quantitative methods like those of human resources analytics to refine HRM metrics used to make organizations more competitive in the marketplace. Most modern organizations are realizing and taking advantage of the extensive benefits gained by collecting, analyzing and using resulting reports for critical strategic decision-making. HR analytics is simply a subcategory of the management information systems function called business intelligence. Here are some ways that HRM specialists on the cutting edge of their field are using HR analytics, as well as the type of training these professionals received to help them perform in this quantitatively based HRM role.

Provide Real Time Insight for Decision Making

Organizations that take advantage of HR analytics methods and the associated software tools gain critical insight into their workforce operations that is accurate enough to influence decision-making. Most senior leaders believe that if something cannot be measured then it cannot be managed, and HRM is no exception to this. In fact, performance of HR analytics functions is even more critical to many organizations who rely heavily on human resource talent to maintain their current operations and develop new ones. When properly implemented, HR analytics systems collect labor data across the organization that includes employee pay, job function, education and training records and performance reports. With this data, HRM specialists can determine the type of return on investment gained from each hire. While no two employees are exactly the same, organizations that use HR analytics are also able to gauge the monetary value associated with a particular human resource by those employees of similar skill sets. These data points, along with market labor rates are used to set competitive pay and benefit levels.

Promoting Value Added HRM

The Society for Human Resource Management (SHRM) is the primary professional organization for the field of human resource management, and one of its main goals is to promote the profession as a value added function within business organizations. HRM specialists who are skilled in collecting and analyzing HR data help their profession meet that goal. Identifying, attracting and retaining distinctive labor talent becomes even more important as industry leaders start more specialized, service based businesses. HRM professionals who can leverage current labor talent to fill positions by using incentives and their negotiating skills and not attempting to replace talented workers with new employees save their organizations time and money.

HR Analytics Education and Training

While HRM degree programs quickly update their curricula to include relevant HR analytics instruction and coursework, it is the professional development organizations that have quickly filled the need for HR analytics training. These organizations offer workshops that range in length from two days to several weeks and provide varying levels of exposure into this exciting way to manage an organization’s workforce. For example, SHRM offers a two-day seminar that instructs HRM professionals about how to link collected HR data to the strategic objectives of an organization to make measurable improvements over time.

Conclusion

Advancements in information systems give HRM specialists tremendous opportunities to contribute value added information needed for executive level decision-making. Human resources analytics methods and systems allow stakeholders to see critical workforce information at the enterprise level and not fragmented data points collected within the stove piped departments of the past.