Organizations are Focused on Using People Analytics As a Competitive Advantage
As organizations spend more time trying to recover from the business impact of COVID-19, they will turn to data to help them. It makes total sense. Organizations have been using data to help them grow their businesses for years. This will be no different. What may be different is the type of data that organizations collect and how they analyze and make decisions from the data.
Earlier this year, the Society for Human Resource Management (SHRM) held its first People Analytics conference. Keynote speaker Jack Phillips talked about how the market for big data is growing and organizations are paying big money to get data. I have to think that, as organizations are making plans for reopening, this will be incredibly important.
One of the key points that Phillips discussed was how organizations are making people analytics not just a part of their operation but a part of their culture. Companies want to hire, train, and support employees who have analytical skills. Those employees are going to help the organization design the internal analytics capabilities necessary to be competitive in the market. During his session, Phillips talked about four key elements in using people analytics as a competitive advantage.
Leadership. An increasing number of organizations are realizing that the key to being an analytical culture is having data advocates on staff and in the room when key decisions are made. This isn’t to say that senior management shouldn’t have a pro-analytics mindset, but organizations are finding a benefit to having the data advocate in the room keeping everyone focused on the integrity of the collection and analysis process. Bad data can lead to bad decision making.
Product thinking. Speaking of process, organizations will want to know what types of data they have access to. For instance, if we think about the balanced scorecard approach, does the organization have financial, customer, operational, and HR data to use in their analytics? And if they don’t what steps could they take to gain access. The good news is that many of today’s technology solutions have data and analytics capabilities plus security protocols built into their features.
Experimentation. Even organizations that lean on the conservative side have to take educated risks. When analyzing data, they will want to have guidelines in place outlining how to introduce new data or to develop a hypothesis. Think of this as a business scientific method. The organization might want to develop a virtual “lab” to test their ideas before implementing them.
Innovative cultures. Organizations want to use data they’ve gathered and analyzed to help them innovate. The book “The Innovator’s Dilemma” introduced us to different types of innovation: 1) Sustain, which is innovation that happens on an incremental basis, 2) Adjacent, when a company does something very well and leverages it in a new space, 3) Disruptive, when a new market is created, and 4) Discontinuous, when a new product is launched which leads to a change in consumer habits.
The idea here is organizations hire the right team to create a people analytics culture. The team builds the internal structure to gather, evaluate, and make business decisions using people analytics. This gives the organization the ability to innovate and ultimately, compete in their respective industries using people analytics.
While I haven’t mentioned HR in this article, you can see how HR departments are a key part of this strategy. They help the organization hire the talent. HR is a part of creating and maintaining culture. They assist in the development of processes and guidelines. And HR systems data is regularly used in analysis. HR departments will be asked to participate in key decisions during their organization’s reopening and recovery. Be prepared to participate.
P.S. If you’re trying to learn more about people analytics, let me suggest checking out SHRM’s People Analytics seminar and specialty credential. I’ve always thought of myself as a numbers driven human resources professional and was very impressed with the program. I learned a lot, especially about using the data to tell a story to senior leadership. Attaining the specialty credential isn’t easy, and I’m very proud to have earned it.
Image captured by Sharlyn Lauby while exploring the streets of Atlanta, GA
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