The human resources industry is a lot more than collecting and tracking employee information today. Over time it has evolved and gained focus on using the available data to create deep analytical connections throughout the organization.

What is Human Resources Analytics?

Human resources (HR) analytics uses data mining and business analytics techniques to process HR data. It is also known as talent analytics. Here, data mining is the study of established databases to generate more information.

HR analytics serves two main purposes, which are providing insights to the team and identifying key data. When HR analytics is used to provide insights, the main aim is to give the company all necessary information regarding their operations. This can be helpful in creating efficient employee management processes and ensure the organization achieves its business goals within the given timeframe. When it comes to identifying key data, HR analytics is used to provide various models to predict ways in which the enterprise can gain optimal ROI on its human capital.

The main purpose HR analytics serves to an organization is to help the human resources personnel make the most of their collected data. Companies usually have a lot of data on their employees such as their demographics, training records and so on. HR analytics is used to make sense of this data and use it to benefit their company. HR analytics can help in improving overall employee performance and also help in predicting the models that work best for the company. There is no human error in decision making anymore. 

Benefits of human resource analytics | iTMunch

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How Can Human Resources Analytics Benefit the Company?


HR analytics can help companies with finding the right candidates for their business. With HR analytics, one can use the collected data to help in identifying the candidate qualities which will yield better results for the company by compiling the existing employee data and finding common denominators that are useful to the company.

Health and Safety

HR analytics can help in detecting all problem areas, especially when it comes to issues related to health and safety. Collected data can be used to point out the roles and job locations, among other factors that have the most rates of accidents.

Employee retention 

Data collected through HR analytics can also help employers learn more about their employee retention. HR analytics can be put to use to help businesses discover the aspects that lead to higher employee engagement.

Talent gaps

There might be departments that have workers with more skills and there might be some that prevent the total performance of the company from improving. This information can be easily acquired through data.

Sales performance 

HR analytics can be of big help when it comes to providing details the way sales targets can exceed. There are a few specific talents, which can be gathered with HR analytics that can help employees improve their performance, or there can be training programs that were conducted that yielded better results and immediate returns when it comes to sales.

Top Priorities for Companies when Implementing HR Analytics

There are five main priorities that companies need to take into consideration when they are beginning the implementation process for HR analytics in their business. These are: data management, systems or reporting or dashboarding, pilot analysis, capability building and privacy. 

Data Management

All companies need a concrete data governance program to help them in defining a specific policy that will hold the responsible people accountable for various elements of the data. This includes the following:

  • Data accuracy
  • Accessibility
  • Consistency
  • Completeness

Companies need to ideally facilitate their HR teams by setting goals as well as KPIs and measures to help them measure their KPIs. This can be done by making sure that the main HR processes are all totally based on facts. The main processes that KPIs need to focus on include recruitment, absenteeism and turnover. 


The second priority would be showcasing how the data management performance relates to the company’s business. The quickest and easiest way to do so would be to invest in or build an effective and automated HR-dashboard.

Companies need to select the personnel that works with the HR dashboard, and these selected employees should have access where they can create cross-sections to be able to see which figures are most important when it comes to their appointed focus area. After creating a dashboard, companies can gain various insights in the form of HR data and KPI’s.

Pilot Analyses

When conducting pilot analysis for your company, it is important to have a set of several skills within the analytics. There are many roles that companies need to analyze their data, which include the following:

  • HR analytics Manager
  • Data Scientist 
  • IT Expert 
  • Subject Matter Expert 
  • Business Expert 

Companies should also keep in mind the methodology that they use. It should be able to shape the given analytics into project form, and working with an agile way would be the best way to do it.

Capability Building

Start the company’s capacity with HR business partners because they are the ones in constant contact with the customers, and they are the ones who will benefit most by using HR analytics as a tool.

After gathering all HR business partners, introduce them to the basics of HR analytics. If a more in-depth knowledge transfer is required, then it is recommended to collaborate with an external supplier. The suppliers can uplift the development of the HR business partners by conducting various workshops to make the company a more data-driven one, or even by giving them practice material to help them build an internal analytics acumen.

The target groups need to be created structurally, and they should ideally include more than just a couple of introductions and workshops. For developing a fact-based culture within the HR department in any company, one needs to develop its analytical capabilities carefully and structurally. 


It is recommended for companies to partner with their Privacy Department and Privacy Officer that takes care of all legal and compliance issues. They need to build an assessment framework for the company before beginning HR analytics with the most important privacy targets.

Working within the compliance and legal framework is crucial for all companies. This is why organizations need to maintain a good partnership with their Privacy Department. Companies should ideally discuss all analysis results with their Privacy Department and then let them set the requirements of the minimum number of people they can report on.

Main Steps to Get Started with HR Analytics

Centralize all Employee Data

The first step for companies when they want to begin their HR analytics journey is to unify all disparate sources of existing employee data into one single repository. Usually the employee data is scattered across various HR systems such as Excel spreadsheets and paper records. When data is spread across many systems, it becomes difficult to access. The entire process is inefficient and time-consuming. If there is just one source, then the data accuracy as well as data consistency improves for the company. Consolidate all employee data to help companies identify various KPIs to help them understand how their performance works with business outcomes.

Create an HR Dashboard

Data visualization is a very important part of any company’s analytics initiative. When companies build their HR dashboard, it works as a centralized place for collecting all internal and external HR data. When there is a visual rendition of all the collected data, the HR team will then be able to both monitor as well as benchmark data. This will help them in deriving insights into specific HR metrics that drive success. Real-time information about all the important HR metrics become easy to access, such as the headcount, attrition rates, cost-to-hire, and more.

Build Analytical Capabilities

HR analytics is still fairly a new concept to most HR teams. This is why HR teams usually lack the skills that are needed to lead successful and effective analytics deployment initiatives. This is why it becomes extremely important to develop the HR teams and give them the skills they need to perform successful HR analytics. This can be done with training alongside the company’s business intelligence team. Once the HR team has a strong analytics skill set within the company, it becomes possible to establish an even better business context for all human capital decisions.

Put HR Analytics into Practice

After the HR team has created a strong skill set for analytics, the next step would be to identify business problems that need to be solved. It could range from anything such as improving retention or identifying high-performers to reducing the cost to company for each hire. 

Teams need to be able to link their analytics to help them achieve business outcomes. The best way to do this is to prioritize the problem at hand based on the following criteria:

  • Business impact 
  • Effort required

This impact vs. effort matrix should always be the first step when conducting analytics. It is ideal to begin with ideas which have a high impact but require minimal effort.

Drive Continuous Improvement

Once the implementation process is in place for HR analytics to solve business problems, the team needs to monitor their processes continuously and check for inefficiencies, errors, and risks that could take place. They also need to follow up on all recurring issues as well as implement the necessary structural changes that are required to prevent these errors in the future. After all inconsistencies have been removed, the team can move to the next step, which is Predictive HR Analytics.

Helpful Tips for Getting Started with HR Analytics

Educate Yourself

Before beginning the HR analytics journey, all the teams involved should read up and become familiar with analytics.

Subscribe to Blogs

There are also a lot of blogs available for reading on HR analytics. These will also help with keeping you updated on the latest trends and updates in analytics.

Join some LinkedIn Groups

There are a few specialist HR analytics groups available on LinkedIn which can prove to be quite useful to companies because they have a large number of members who regularly host discussions about this niche.

Network with the Experts

HR is a very well known function in a company, and it is renowned for networking. Team members should interact with other experts in the field and learn what they can from them.

Become Familiar with the HR Analytics Vendor Space

The most progressive and exciting work being done in the HR analytics field is by a lot of start ups. There are new firms that are coming up nearly each and every day in what can be considered a nascent space. When one looks closely though, you see that a new practitioner of HR analytics will find these firms extremely helpful in guiding them with taking the first step.

Plan the First Hundred Days

Getting started is usually the most difficult part of any endeavour. The first few days and the amount of effort you put into them is what determines the success rate of any project. Companies need to recognize that the first hundred days are the most crucial ones to the success of any business initiative. All aspiring HR analytics leaders need to plan the first hundred days at least to help them get started.

Identify the Business Problems

The first rule of HR analytics is to start with the problems in the business. Take into consideration all challenges the company faces and conclude the ones that a thorough HR analysis would help in solving. HR teams need to work with finance and IT teams to gain valuable knowledge in making the right decisions

Tips to get started with HR Analytics | iTMunch

Perfect Your Storytelling Skills

Implementation and execution of initiatives that are linked to HR analytics is very similar to good storytelling. The steps involved are interpreting the given data, then using it and distilling it into insights which will help in unlocking business problems that the company is trying to solve. After which you create a compelling argument and make your case to frame the entire process. This is extremely important because the quality of the data will not matter, neither will the incisiveness of the analysis if you cannot make the gathered information resonate with the ones  who have a stake in your business.


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