Big data: that is, analyzing people – can make it easier to hire, retain and determine where your next office will be.
In the film The Strategist, released in 2011, Brad Pitt assembles a baseball team based solely on a statistical analysis of the performance of each player. It shows that if people management is seen as a human task, big data can be a game-changer.
Make the transition from the ballpark to the workplace, and big data helps managers hire and retain top talent more efficiently while reducing staff turnover and improving diversity. Welcome to the world of people analytics where, according to global company Leathwaite, companies that use it outperform their competitors by 30%.
What Do We Mean By Analyzing People?
While people analytics can sound like a dating algorithm, it’s currently a way to make better business decisions through the use of data on people’s behaviour, relationships, and characteristics. Which candidate do you need to hire? Who should receive a promotion? Who plans to leave? Does this person deserve a raise? Big data simply offers hard evidence.
Why Is Its Success Growing?
The technology already exists: people are only using it smarter. Recruitment is a good example. “With technology making it easier to get to know job seekers, companies no longer need to rely on their instinct to hire, structure their teams, know where to open offices and how to create competitive talent management strategies”, explains Jon Addison, manager of Talent Solutions at LinkedIn.
People analytics enables managers to leverage data because they have access to a wealth of real-time information on where to find talent, how to attract it, and how to retain employees.
“It is clear that the role of insight and analytics in talent management strategies is increasingly important,” adds Jon Addison. “One of the reasons for this is the growing need to pre-determine the workforce and skills required in a competitive landscape where companies struggle to hire the best from a limited talent pool. For companies capable of looking 10 or 15 years away, this tool becomes irreplaceable for effectively managing teams and ensuring their long-term success. “
Is The Area Of Hiring The Only One Concerned?
People’s analysis is valuable for other reasons. It makes it possible, for example, to reduce the staff turnover rate. According to an MIT report (3), recruiting, hiring and training a new employee can cost up to 1.25 times their salary. Also, smart hiring and staff retention offer an attractive return on investment.
Studying historical data can help businesses identify patterns and predict when and why people are likely to leave, ultimately saving money. Being able to identify the causes of departures of company personnel (lack of a manager, transport problems, lack of a raise or promotion, etc.) allows managers to manage the situation before it turns into a problem.
People analysis also helps shape leadership development by identifying employees who are able to replace a departing colleague through tracking their past performance, success, and other metrics. It also helps identify their motivations.
What Are The Other Advantages?
According to a recent global study by McKinsey Global Institute (4), mixed and multi-ethnic companies are respectively 15% and 35% more efficient. People analysis helps to track and manage the recruitment, hiring and retention of a diverse workforce.
The analysis of this data also makes it possible to identify integrated expertise (this point will be developed later) to highlight the best practices within a company.
How Are Businesses Using People Analytics Today?
The Harvard Business Review recently worked with Microsoft’s Workplace Analytics division to observe Fortune 500 companies using people analytics.
This involved, for example, evaluating the processes of a company in order to identify the integrated expertise. A global consumer packaged goods company was looking to understand how a specific monthly financial process was approached differently in each of its subsidiaries around the world. She found that in one country, this task was performed 16% more efficiently, resulting in a monthly saving of 71 hours of work with 40 fewer people. Neither the company nor the accounting team was aware of this. The accounting team was involved in managing the process to improve the efficiency of the other subsidiaries.
Even Microsoft has been able to uncover an ecosystem of hidden talent through people analysis. As the company sought to recruit cybersecurity professionals while hesitating to restrict hiring to Redmond, where its head office is located, the data analysis allowed it to uncover another site with many talented locations. already found a very small office. With this valuable data, company executives knew they needed to increase investments and assess the workforce in this city so that Microsoft could hire the best talent in the best places.
A New Future
People analysis can replace decision making based on anecdotal experience, hierarchy and risk-avoidance with better decisions based on data analysis, prediction and experimental research.
While instinct still plays a role, big data can prove useful in determining who to hire, how to structure teams, where to open new offices, and how to stay competitive to attract talent. This is the first time that workforce data has been accurate, reliable and available in real-time.