HR And Big Data: Making Sense Of Numbers In Technology Space

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28th Feb 2015

4 min read

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Analytics and metrics have been identified as one of the eight major trends in human resource (HR) management for the next decade.

With the technological revolution brought about by data-mining technologies at an all-time high, one can only dream of the limitless possibilities that analytics can churn out.

What does this really mean for HR and HR practitioners – the real end users of all this seemingly endless stream of analysed data?

Big data – Origins & definitions

Big data is a term adopted by market researchers that refer to what Gartner describes as:

high-volume, high-velocity, and/or high-variety information assets that require new forms of processing to enable enhanced decision making, insight discovery and process optimisation.”

Sounds long-winded and confusing?

The term originally coined by Doug Laney of Gartner referred to the three V’s – volume, velocity and variety.

Since then, many others have added more V’s into the mix including validity, veracity, value and visibility.

Interestingly, all of these make sense as the enormous volume of data generated by organisations and systems is worth absolutely nothing if it is not properly validated and verified.

Invalid data is literally “garbage” to the hardcore marketer.

The real meaning

For organisations, “big data” means a humungous volume of data on almost every known facet of information generated by the company.

It is what marketers are really after – data about potential employees, suppliers, customers, prospects, products, geographies, and community.

Data is churned and analysed from every possible angle to get an infinite variety of interesting insights from workforce demographics to working practices, as well as understanding employee habits and lifestyles.

The ability to “data mine” these seemingly meaningless transactional data and translate them into a sensible warehouse of information that can be used to make critical business decisions is what adds value to “big data”.

And this is exactly what organisations are looking to get their hands on.

The implications for HR

From a HR perspective, “big data” is a dynamic gold mine for the prospective employer, which can cover all areas of HR management including the full lifecycle of HR functionality across different categories, disciplines and borders.

More importantly, ‘’big data” will deliver tangible results after processing an inordinately huge amount of data collected from various sources, both internal as well as external.

Imagine the leverage that you would have if you were able to do any of the following:

  • Know where to place your online recruitment advertisement for best results at optimal cost.
  • Understand the effectiveness of job vacancy advertising through various media and pinpoint which media brings about the best returns.
  • Have a clear picture of the demographic profile of your potential workforce and their media preference when searching for jobs.
  • Create more effective recruitment and advertising strategies and also identify the target candidates quickly and more effectively.
  • Know the effectiveness of your entire talent management including what attracts potential employees.

A technology-enabled solution that meets even half of the above requirements would give you a distinct competitive advantage. This is what modern businesses yearn for.

However, the trick is to put this massive amount of information to work for you, not only for HR, but for the entire organisation.

Doing so gives greater visibility and demonstrates innovation and leadership for the HR team.

To effectively leverage on this intricate and voluminous set of data, you may want to engage the services of “data scientists”, a new profession that marries the science of information management with the demands of the latest technological innovations.

What the future holds

In an increasingly competitive and challenging business environment, organisations around the globe are looking to make a difference in the way they project and brand themselves.

As analytics become a trending innovation in the technology space, it is more so for HR analytics.

For organisations that have yet to use information systems such as SAP, Peoplesoft or SAS, this might be your stepping stone.

Investing in a custom built solution tailored to meet the needs of the business would definitely give high visibility to your organisation.

This is crucial as HR would then be seen as a strategic business driver in the organisation, rather than just an operational and administrative unit.

“The ability to handle extremely large data volumes,” predicts Yvonne Genovese, vice president and analyst at Gartner, “will become a core skill in businesses and organisations. Increasingly, they will be looking to use new forms of information – such as text, context, and social media – to identify decision-supporting patterns. This is what Gartner calls a pattern-based strategy.”

Predictive analytics

Technology companies are pushing the barriers of innovation when it comes to HR analytics.

Predictive analytics (see Figure 1) is the latest buzzword in the management pages of technology journals globally.

Talent Analytics Maturity Model®
Figure 1: Talent Analytics Maturity Model®

What this means is that such technology has created an unseen sophistication and intelligence that is able to predict the future based on past trends, and analyse the future outcomes of business decisions based on the data currently available.

On top of the smart HR dashboards, more organisations are turning to predictive HR analytics to give them an in-depth overview of their workforce and to make predictions on the future behaviour of their employees.

This is a most welcome addition when it comes to hiring, training, developing and managing employees, especially where it involves diversity in culture or other factors.

Case study: Impact of predictive analytics

Xerox reduced call centre turnover by gathering and studying data on the characteristics and job performance of frontline employees, then applying what it learned to the hiring process.

Evolv, an analytics firm found that employees without call centre experience were just as successful as those who had it, allowing Xerox to broaden its candidate pool.

Armed with such detailed information on what made a successful hire, Xerox was able to reduce attrition by 20%.
Given that it costs Xerox US$5,000 to train a call centre employee, that reduction had a real financial impact.

Concluding thoughts

Predictive analytics solutions certainly look like the future of technology. Moving forward, it is high time for HR practitioners in Malaysia to look into big data and HR analytics.

Venkat is a HR consultant and trainer at MIHRM who believes predictive analytics is the future of HR solutions. He follows new trends and solutions in this area closely and is hoping local HR software can cope with this demand for a sustainable future. Send us your feedback at editor@leaderonomics.com or comment in the box provided. For more HR Talk articles, click here.

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