Source |Lucy Boyle
Human resource departments oversee employment and faculty affairs. HR also makes up a large percentage of overhead spending. The HR marketplace is a $400 billion industry in the U.S. alone. To make the most of HR resources, companies are advised to study internal data in this field. Big data, after all, isn’t just limited to sales and customer service.
1. Reduce Turnovers
Hiring new recruits is an expensive process. This is why turnovers can be financially costly. An employee leaving means having to spend more overhead to bring in and train the replacement. According to one estimate, hiring a replacement equals the cost of six to nine months of the job position’s salary. If you’re filling a position that pays $40,000 a year, that means you’ll spend $20,000 to $30,000 in the recruitment process.
By analyzing HR data, you can determine key patterns in employee profiles. Data can reveal factors that are high indicators of a voluntary resignation. This helps you determine who are at risk for leaving the workforce, when, and why. This helps you determine remedies to keep employees on board for the long haul.
With the data, you can see who is leaving. Is it the best or poorest performers? Is it those with most or least seniority? The reasons are often complex and require a specific remedy that goes beyond a quick fix like increasing salary.
Data sets should also be cross examined. Are resignations tied to factors like tenure, lack of training or field work opportunities, promotion wait time, etc.? The data set as a whole can even be crosschecked with data in the sales and customer department. Do sales and customer retention generally take a hit when there is a spike in turnovers?
2. Compensation and Benefits
Which types of benefits and/or compensation have the most measurable impact on staff retention and productivity? As mentioned, performance and morale aren’t merely just tied to a worker’s salary. You can simply ask employees through surveys. It’s as simple as asking what type of benefits would they like and would motivate them to strive for higher performance. New recruits can be asked the same question as well. Existing HR data will even reveal whether higher performance is tied to a particular benefit package or rewards program. Past data may even show whether such benefits have actually yielded better work ethics.
HR data also allows you to analyze the cost of such rewards and benefits. See how the expenses weigh against the possibility of staff failing to show improvement or resigning altogether.
3. Predict Prospect Talent
Data provides clues about new hires. Which recruits are likely to be the strongest performers out of the existing talent pool? Data may predict who will be the high achievers. Recruits that fall into this category can then be transferred to fast-track programs or given high-stakes assignments.
HR data in this area can include the profiles of previous high achievers. Look for matching or closely matching data among new recruits. The data may reveal that top performers share similarities. They may:
●exhibit particular personality traits
●fall within a specific income category
●have been employed within the last X months
●hold degrees in certain fields of study
●fall within a certain age, gender, or geolocation demographic
●have been employed for X number of years in their last job
This doesn’t mean you have to limit recruitment to people who fall into every one of these categories. It does, however, provide insight as to members you should keep a special eye out for.
4. Improve Learning
Training, whether in the field or inside a classroom, costs money. Is the training resulting in the best learning speed and effectiveness? BI tools can chart the correlation between performance and type of training. It can show, for example, whether traditional classroom learning for new recruits yielded better integration compared to online learning completed at home at the recruit’s own leisure. This type of correlation can also be done for various types of hands on field training. Does performance increase when recruits are taught by in-house staff, or by third party training services?
Furthermore, do refresher courses result in higher performance? If so, is there a point when the improvement tapers down to baseline levels? Knowing such information helps you determine how often should refresher training be held, if at all. This kind of data can even be crosschecked with retention data. Training may be withheld for members that are deemed at high risk of leaving. This not only saves money, but it also prevents potential soon-to-be ex-employees from taking that knowledge with them to a competing company.
HR departments have an immense responsibility. Their performance has a great deal of influence on company performance and overhead spending. This is why it’s more important than ever to make data-driven decisions rather than rely on intuition or general data.
Lucy Boyle is a mother, blogger and freelance business consultant; currently a regular contributor to Allocable’s blog. Follow her on Twitter @BoyleLucy2.