The Three Pitfalls Of HR Analytics


Thanks to data and analytics transforming the HR function, it becomes vitally important to ensure that organizations have access to the right information. The data, which are inaccurate, in addition to cumbersome reporting structures, can prove costly. Since they play a crucial role in decisions related to businesses, they can result in losses of millions of dollars. The problem with regards to data quality like accuracy, reliability, timelines, completeness and consistency play a very crucial role in making the data usable. It is also important for companies to look at and be aware of the other challenges. I have taken the liberty of listing a few pitfalls to avoid when trying to leverage HR Analytics:

1) Different data sources tell different stories

Due to the multiple data sources, it is a challenging exercise to draw insights from several different systems. “Which source does one trust?”s the question that a soiled data prompts. Dow Chemicals spoke about a prior struggle with “spot solution” analytics that led to inaccurate reporting… Don Gaertner, the company’s Global Director of HR outlined how the organisation tackled the problem. Dow Chemical created of a global reporting warehouse with the goal of keeping all of its data in one place, which would then roll up to the highest levels of the company. One platform, one story.

2) The reporting doesn’t mean anything

The second challenge that organizations are confronted with, is to do with data and information that often does not inform decision making. This situation arises when companies are left with spreadsheets and insights that travel no further. To ensure that such insights are valuable to HR leaders, data needs to be filtered into role based and user friendly templates. One of best example for customer succeeding at finding meaning from HR Analytics is the American Express. The use of dashboards with real time metrics and trends is enabling American Express’ HR group in measuring its recruitment effectiveness, driving its talent acquisition strategy and finally in managing its individual recruiter performance.

3) HR Analytics lack an enterprise view

The lack of integration between finance and operations in an HR analytics platform may render the insights invaluable. An analytics platform should take into account an enterprise-wide view of data and reporting. Employee compensation, for instance, is an important cost head that top level HR, finance and business leaders need to have visibility to. Having an enterprise view of data ensures that even the senior management does not have to wait for HR reporting to come to them – they can immediately access insights such as overtime reporting and make decisions based on those findings.

Apart from selecting the right technology vendor, companies also need to emphasize on building analytic capability in their HR professionals. The journey from a traditional company to a digital company can turn into a success only if the HR is emphasizing on enabling systems and practices that are aware of the pitfalls of false reporting.


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