The Future of HR: What is People Analytics and Why it Matters

If you are a human resources (HR) professional, you’ll most likely already know that people analytics is no longer a buzzword or something that’s “nice to have”, it’s a must in a data-driven world.

People analytics is the identification, collection, and analysis of data about the employee experience that HR leaders and organizations use to make data-informed decisions about their workforce strategy. It can be useful to help with attracting and retaining qualified employees, identifying and supporting high performers, promoting diversity and inclusion in the workplace, as well as supporting employee health and well-being.

To help understand how people analytics is shaping the future of HR, we spoke with Aubrae Wilson, Program Director of Continuing Education at The Chang School, who is behind the new People Analytics Postgraduate Certificate, launching this fall. The program was designed in collaboration with industry subject matter experts from various sectors to ensure that learners develop and gain skills that are in-demand and workplace-relevant.

Whether you’re familiar with people analytics or just getting started, Aubrae provides her perspective on the field and why it’s important to HR leaders today.

What’s the Difference Between HR Analytics and People Analytics?

These terms are often used interchangeably, however, as Aubrae points out, there are a few differences.

“I like to look at HR analytics as a subset of people analytics,” she says. “HR analytics focuses on the HR function and specific areas like recruitment, compensation, performance management, and turnover, whereas people analytics takes a broader perspective and looks at employee experience, which involves aspects like productivity, engagement, and retention.”

To illustrate how these concepts work in the real world, Aubrae gives an example of the two in the area of recruitment.

HR analytics might look at the time it takes to fill a position from when it’s posted to when a successful candidate is hired. The information gathered during the time to fill the position is an “indicator of HR process efficiency,” she explains.

“If it takes very little time to fill a position, it may be an indication that the HR recruitment processes are effective, that the job expectations are realistic for the skills and experience that candidates possess, and that there are enough candidates who possess the required skills and experience in the marketplace.”

However, Aubrae adds, if it takes a long time to fill the position, then this could be an indication that something needs to change – whether it’s the recruitment method, job description, or something else altogether like a deficit of qualified individuals. These are all aspects that have impacts on the organization and its ability to function effectively.

With people analytics, looking at recruitment might focus on the quality of the application in terms of how well they perform in the position they were hired for, their productivity and impact on the organization, as well as their likelihood to be a top performer, Aubrae explains.

“Looking at the data behind each of these aspects, across the organization, can inform and refine the HR recruitment processes to be more effective and more aligned with organizational goals,” she says.

How Does People Analytics Help HR Professionals and Teams?

We’ve already alluded to this above in the examples that Aubrae provided but another way to think of it is people analytics helps HR professionals by providing data-driven insights that enhance their ability to be proactive versus reactive in the management, support, and development of their workforce. It enables organizations to make more effective, evidence-based decisions on improving their workforce well-being and organizational performance.

People analytics can also demonstrate the impact of HR policies and processes on the workforce and organizational performance.

In terms of other aspects of running a business, people analytics can also be used to estimate the financial and social return on investment of change initiatives like the implementation of new technology, mergers, and acquisitions, or changes in leadership, which often can destabilize an organization and make employees feel disconnected or dissatisfied with their workplace.

Why is People Analytics Important for the Future of HR

As in all industries in this technology-driven economy we are operating in, using data to make decisions creates an environment where leaders are practicing informed decision-making rather than acting on gut feelings.

People analytics equips HR professionals with comprehensive, data-driven insights – from recruitment strategies to employee engagement initiatives.

“Decisions are no longer based on gut feelings but on a nuanced understanding of historical and real-time data,” says Aubrae.

It also enables more strategic use of time and financial resources – from more calculated recruitment strategies and employee training to compensation and benefits packages – people analytics provides data to direct investment decisions.

How to Get Started in People Analytics

So whether you’re using people analytics already in your organization or you’re just beginning to explore it, to really use analytics to your advantage in your organization, there are certain experiences and skill sets that you need to acquire or hone.

As mentioned earlier, The Chang School now offers a postgraduate certificate program in people analytics. It is developed through a collaborative design process where learning experience design experts and industry subject matter experts, who you’ll hear from in upcoming articles, work together to produce high-quality and meaningful learning experiences for adult learners.

To learn more about the program and the benefits that come with being a part of The Chang School community, including building professional networks through interactive peer and instructor discussions, visit our program page.