the last word
USING ANALYTICS TO DRIVE
STRATEGY AND FIND VALUE
As time has passed, most departments
have become data-driven
in their decision-making. When
we think of areas like finance
and operations, we can easily visualize
those being highly numbers-based, but
we don’t often think that way about HR.
Well, the HR world has been changing.
HR has been moving away from gutbased
decisions and has begun to use
data analysis for more effective decisionmaking.
Contributing to this evolution is
the renewed focus of software vendors to
enhance storage and integration of HR
data. Systems integrating employee information,
job competencies, performance
and succession planning are now available.
HR is one of the last departments to
fully leverage its data, and a shift in the
skillsets of HR professionals can be seen.
Small analytical teams are appearing in the
HR function and analytical consultants
have appeared on the market to assist
companies in evolving the industry.
Why has this become increasingly important?
HR is under pressure to become
leaner and more strategic. Recent literature
in the field has been concentrated on
proving the value of HR to the bottom
line. HR leaders are being asked to prove
the value of new programs before they are
allocated additional funds.
Two of the hottest topics involving data
analysis are HR analytics and strategic
workforce planning. HR analytics use data
to evaluate information. The possibilities
are limited only by the data you do or do
not have. How can HR show value with
analytics? Here are just a few examples:
■■ Determine whether HR metrics impact
■■ Calculate the value of your annual feedback
survey and its link to internal HR
■■ Determine the impact of HR programs
on their intended result. Use the result
to prioritize HR resources and budget
■■ Assess the strength of the relationship
between turnover and engagement. The
result can be used to know how much
return to expect on programs used to
The second hot topic is strategic workforce
planning. In a nutshell, workforce
planning aims to mitigate the risk to successful
strategy execution by ensuring you
have the right talent for the future. At a
high level, the main steps are to begin by
finding the roles that matter most to your
company’s success. Then, assess what your
workforce looks like today and what you
need tomorrow. Finally, determine what
actions are needed to close the gap between
what you have and what you will
The value of analytics and workforce
planning to HR is substantial, but most
teams are at the infancy of using these
tools. If this is the situation in your organization,
it is best to find an external expert
to guide you through the possibilities.
Recommended additional resource
HR Analytics: The What, Why and
How – This book is suited for the HR
leader who needs to implement HR analytics
or for the use of the HR analyst.
Strategic Workforce Planning: Guidance
& Backup Plans – This reference is
a detailed guide for those needing to learn
the benefits of strategic workforce planning.
Data Driven Decision Making for
Small Businesses – This book is for the
business leader who is interested in how to
make basic data-driven decisions throughout
multiple functional areas. n
Tracey Smith, B.Math, M.Sc, MBA, president
of Numerical Insights, is an independent
consultant experienced and specializing
in using data analytics to make strategic
By Tracey Smith
Illustration by Shironosov / Photos.com
80 ❚ FEBRUARY 2014 ❚ HR PROFESSIONAL