Aniline Blog

A Beginner’s Guide to HR Analytics

3 Minute Read

You no longer have to rely on gut feelings when it comes to employee sentiment, employee performance, and new talent recruitment. As organizations move forward in their digital transformation journeys, they have access to more data than ever before, including more precise HR analytics. Because they give you the ability to make smarter, more impactful decisions based on data insights into people and performance, HR analytics are a powerful must-have in your organization.

If you google “HR analytics”, you’ll end up with 803 million results. So, how can you make it easy to understand and leverage this powerful type of data?

Read on.

HR analytics is the process of collecting and analyzing data in an effort to improve an organization’s workplace performance. It’s a big umbrella that encompasses people analytics, talent analytics, workforce analytics, and employee sentiment. When measured correctly, HR analytics can answer some of your biggest questions, like:

  • How high is our annual employee turnover?
  • How much of that turnover is regretted loss?
  • How much of that turnover is voluntary/involuntary?
  • Which of our employees are most likely to leave over the next year?
  • Why is there a surge in exits once our employees hit their two-year anniversary?
  • Which of our employees have the highest absenteeism rates?
  • Which of our employees have the highest potential?
  • Why have the number of applications for our open positions fallen?
  • What is our offer acceptance rate?
  • How long, on average, does it take to fill our open positions?
  • Which recruitment channels drive the most new hires?
  • How efficient are we at training new hires?

One of the most powerful types of analytics that HR professionals can tap into is employee sentiment because it answers the most vital question of all: “How do our employees really feel about the organization?” If you can get a data-driven answer to this question, solutions surrounding turnover, absenteeism, and maximizing potential will become much clearer.

As an HR professional, this is as close as you’ll get to a crystal ball.

By getting away from gut feelings, you can make smarter decisions about how you recruit new talent, measure employee performance, and how your organization operates as a whole. Plus, getting answers to questions like these on an ongoing basis is a great way to generate benchmarks for your organization. Even better, with the right HR analytics tools, you can spot issues—and start working to resolve them—before they balloon into giant problems. 

What else can you accomplish with all of these data-driven insights?

  • Minimize risk

By stepping back and taking a deeper look into your turnover—especially your regretted loss—you can determine why people are leaving and how you can stop them. As a result, you can retain more of your valuable employees, instead of having to cross your fingers and hoping that you can find a replacement that can provide just as much value.

More importantly, determining why people are leaving and working hard to create a culture that they want to be part of can lead to big gains in your employee sentiment. As a result, you’ll see fewer negative reviews on Glassdoor and Indeed.

Minimize expenses

Filling open positions comes with obvious costs, like paying to list new positions on job websites, and not-so-obvious costs. For every minute you spend trying to recruit new talent, that’s one minute where you can’t focus on other priorities. And once you bring management in to conduct interviews, that’s time your leaders could otherwise be spending on revenue-generating work. 

Plus, getting a new employee up to speed temporarily reduces your team’s productivity, which translates into less revenue. If your organization has a high turnover rate, these onboarding losses will really begin to add up.  

Align your work with your organization’s business goals

HR analytics give you the opportunity to define measurable success in your department and across your organization as a whole. With so many valuable metrics to look at, HR analytics can help you create a data-driven strategy for virtually any people-related business goals across your organization. You’d never be able to work this way if you could only rely on gut feelings!

Drive overall business value

HR analytics give you the power to approach your employee experience the same way you would approach your customer experience. By creating an environment where your employees want to do their very best work, you’re creating an environment that’s higher in employee sentiment—and much more valuable to your bottom line.

When you look at it this way, it’s easy to see why so many HR professionals rely on analytics. With the right tool, you can generate actionable, data-driven insights that transform your daily work and, more importantly, the impact you make.

Kevin Gregson

Kevin Gregson

A consulting industry veteran, technology entrepreneur, and insurance industry innovator, Kevin formed Aniline while working on the insurance vertical of Plug and Play, a technology incubator in the Silicon Valley. His vision for Aniline is based on applying the power of artificial intelligence and machine learning to help organizations improve the lives of their people. Also a senior advisor to Plug and Play and a board member of Nassau Insurance Group, his past roles include senior executive positions at Willis Towers Watson, Alvarez & Marsal, and Ernst & Young.