People analytics experts are finding new ways to use data to make better decisions within the Human Resources function in order to drive value to the bottom line and increase employee satisfaction, HR Analytics and Compensation Analytics being two such major areas of focus.
With more pressure to attract and maintain high-performing talent, HR organizations have shifted their focus to using analytics to proactively drive a better employee experience and culture. It has been observed that the largest cost recorded in the financial reports is often the cost of the workforce. Because of this, compensation analytics has become a strong focus for executives that need to keep costs in line with revenue to maintain a healthy, profitable company.
The benefits of Analytics in HR;
a. Enhancing the hiring process: Hiring right talent continues to be a vital area for organisations across the globe. The data driven analytical strategy can help you review the earlier approaches and decisions, refine them and ensure hiring is more aligned to specific requirements. This makes the process superfast and time efficient, focusing only on the areas that matters.
b. Talent Retention: Employee retention or as it is said high employee turnover is another crucial area of focus in HR. With a powerful analytics approach it becomes easy to understand why employees moves away, which enables you to construct better retention strategies, employee engagement policies and likewise.
c. Analytical approach in HR can help you in improving Employee Engagement by understanding their needs and satisfaction at work place, employee performance and productivity, etc.
d. Compensation analytics on the other hand gives you an ability to protect a company’s bottom line, as the cost of the workforce being a large spend contributor aspect for most of the companies, compensation analytics helps you to take more efficient and strategic decisions.
e. Analytics in compensation can assess you in defining the pay equity. It can also assess you in determining the sales effectiveness, as determining the ROI from sales force investment is crucial for almost all of the companies across globe.
f. Compensation analytics can help you in Tracking your Business Goals. You get a data driven understanding of your total rewards program, whether it is achieving its intended goals or not. By analyzing trends in salaries, you will know if you are following your stated goals for compensation at your organization, and if those goals are aligned with your business goals.
With more data, comes more power. Analytics in HR will definitely boost an organisation to identify key drivers that will retain and reward the right talent while boosting the business’s bottom-line.
So the top 3 reasons for investing in HR Analytics include:
1. Integrated Talent management and compensation
2. Enhancing the recruitment precision
3. Performance management, Labour cost and resource spend analytics, maintaining transparency in information and decision making.
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