Sneha Das (Batch of 2023)

“The goal is to turn data into information and information into insight"

Carly Fiorina, best known as the first-ever woman CEO of Hewlett-Packard (1999-2005), gives us more than enough reasons to delve deeper into the fascinating area of analytics and understand how we can use it to realise certain benefits in our businesses.

Backdrop

The war for talent is a significant challenge for companies today. Organisations worldwide compete to attract and, more importantly, retain the right talent, develop their employees, and take care of their well-being. Thus, understanding predictive analytics and exploiting it in daily operations support HR business functions and helps organisations overcome such challenges.

HR analytics is a multi-disciplinary approach to incorporate a structured methodology for improving the quality of people-related decisions to enhance individual and organisational performance [2]. HR analytics uses sophisticated predictive modelling by which we can predict the consequences of changing policies or conditions [2].

It is, however, instructive to note that predictive analytics is different than descriptive analytics. Whereas the latter considers external benchmarking data and involves tables, reports, and complex maths, the former is more of a prescriptive nature that draws inferences from data and aids organisations in making better decisions. Predictive analytics entails statistical techniques, machine learning methods and data mining models to [2]:

• Extract Facts
• Analyse
• Predict for better implementation of strategy

How can an organisation build a successful predictive model for employee engagement [2]?

1. To build a clearly defined predictive model, collecting and assessing HR metrics should be the foremost step
2. After that, we design predictive models for every HR functionality based on the data collected
3. Insights and inferences are then drawn from the historical data, with the help of the predictive model, for a more streamlined decision-making process in the domain concerned

Steps

Collection of HR Metrics

Thirteen HR metrics that organisations worldwide usually monitor to better understand how to expand the influence of their HR functions are:

1. Monthly turnover rate.
2. Revenue generated per employee.
3. Yield Ratio
4. Human capital cost
5. HR to staff ratio