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7 Things About People Analytics You May Not Know

Jan 11, 2022

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People analytics is rapidly mushrooming.  

Companies are becoming increasingly aware of its benefits beyond an HR reporting tool or using fancy formulae to figure out what talent characteristics drive performance.   

However, despite its popularity and importance, the rate of adoption lags behind awareness.  

Much of this hesitancy involves preconceived notions, assumptions, and a general lack of knowledge.  

Let’s dispel some myths and clear up some misconceptions by looking into seven things you may not know about people analytics. 

 

1. People Analytics  HR Analytics 

While they are often used interchangeably, the terms are not synonymous.  

HR Analytics focuses on the HR function. It monitors and measures the impact of talent engagement, performance, and retention on business performance. 

This data analysis allows HR managers to quantify their success over the employee lifecycle.  

On the other hand, People Analytics casts a broader net and has implications for the organization as a whole.  

It uses data insights to solve business problems, inform decisions, and drive strategy with data from all the people in the company’s orbit. 

 

2. People Analytics doesn’t have to be expensive, complex, or require a long time to set up. 

Good news! Gone are the days when you needed a huge upfront investment for analytics. 

With the advent of cloud-based technologies and Software as a Service (SaaS), implementation became more cost-effective. 

You can save money by taking only the specific elements you need and making small steps. If you start with a small project to demonstrate efficacy and get executive buy-in, you can gradually increase your capabilities as you prove value.   

The idea is not to get overwhelmed by the many possibilities that people analytics presents. Do not be distracted by the latest developments in the field.  

Instead, focus on your specific and immediate needs. Select a solutions provider who isn’t just peddling their company’s software but can create a value solution based on their understanding of your business needs, culture, and unique challenges.  

 

3. It’s not just for the big boys. 

You don’t have to be part of a large enterprise to benefit from people analytics. You don’t have to work for Google, Dell, or Amazon to use people analytics. The good news is that it’s scalable.  

SMBs tend to shy away from the investment as a “nice to have” because it may require too much of their limited resources. (See #2 above)  

The truth is that in the long run, using people analytics to promote data-driven decision-making ensures that you will make better use of your limited resources.  

Companies with time and money constraints do not have the luxury of trial and error and need to get it right the first time.  By using people analytics to inform their business strategy, SMBs can narrow their margin of error and avoid costly missteps. 

 

4. Garbage in, garbage out. 

Poor quality data is a non-starter.  

Usually, when a business is just getting started with people analytics, it needs to extract its existing data from various sources and clean it up to make it usable. 

The cleaning process involves making sure that the data is up-to-date and relevant, complete, and is free of errors and duplications. 

This process is critical since data quality will ultimately affect the organization’s ability to make accurate, informed decisions that are beneficial to the business. 

 

5. Relationships might be more important than employee attributes.

Using only employee attributes to measure performance and potential is a woefully narrow approach to people analytics.  

An employee’s value to an organization goes beyond demographic or psychographic data. People do not exist in a vacuum. 

Our relationships and networks are as much a part of who we are and affect our performance and employee experience as our education and attendance record. 

Team dynamic is everything. The chemistry or lack thereof within and between teams can affect productivity and morale.  

Relational analytics is the discipline that explores and studies social networks in the organization. It can reveal those employees with influence or those with high levels of innovation and efficiency. These are essentially the “keepers” who ultimately help achieve company goals. 

 

6. Ethics and trust are paramount. 

Collecting and using employee data requires that you build their trust. Never take their faith for granted. 

Though challenging, leadership must be transparent and ethically driven to adhere to robust privacy and security considerations. 

Work on creating a culture of transparency. Compliance with GDPR legislation is just one part of it. The other part is internal to the organization. It is focused on the company culture, which is strongly influenced by its leadership. 

 

7. People Analytics is a journey, not a destination.

Most organizational leaders agree on the importance and value of people analytics. 

However, many factors will influence where a business begins and its specific path. There is no “one size fits all” formula, neither will implementation be simple. 

It will take time to upgrade and harmonize data systems through integration and develop the mindset required to effectively use analytics to support business strategy. 

 

 

About Pixentia

 Pixentia is a full-service technology company dedicated to helping clients solve business problems, improve the capability of their people, and achieve better results. 

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