If you plan on enacting or are currently working with any form of evidence-based management, you may want to know where that evidence comes from. One of the best ways that you can tell what is going on within your organization is by intelligent use of human resource analytics, otherwise known as HR analytics. The goal of this form of analytics is to take data from your human resources department and display it in a way that will help you as a manager or business owner to get the most value from your employees.

Basics of HR Analytics

HR analytics should also be used to give your employees the most value from you, as a manager or owner, and your human resources department. Some of that data that you can gather for analysis includes productive hours, jobs completed, sick days, vacation time used and more. From both sides, this method of analysis allows management to make the best-informed choices when it comes to processes, hiring and policies.

Whenever you are dealing with any form of analytics, you must know how to appropriately approach the data. Too often, new managers or those who are not used to dealing with metrics think that numbers are all that they need. While that information is essential, it is worthless data unless it can be appropriately read, analyzed and utilized.

Importance of Specific Needs

In order to use HR analytics appropriately, you should begin with a problem that needs to be solved in mind. Otherwise, you're merely collecting data for no purpose. For example, one of the most common issues that many businesses face is employee turnover. An example of a specific question to resolve via metrics is, "why do we lose high-level technicians if they are promoted from within the organization?"

HR departments usually maintain a massive trove of data, collected on employees from the moment they are hired until the moment they end their employment at your company. By applying this to your internal policies and procedures, it can help your company to grow. When you are using this data-driven approach, you are engaging in a form of HR management.

Getting Started With HR Analytics

Most companies already have the data that they need simply by searching their HR database or other HR analytics tools. Proper databasing and HR analytics software allows your HR professionals to run reports and provide solid facts about staff over any given span of time. To get started with HR analytics, you need some way to analyze those numbers.

There are many tools that are available to you and that have a wide range of different uses and applications. Freeware analytics can take the numbers you’ve tracked and give you a few easy-to-scan reports. Expensive software can be built to your company's specific needs, as well, to handle any unique requirements.

Choosing HR Tools

What sort of HR analytical tools you need is up to you and should be determined by a panel of employees and HR staff members. Many different subscription tools can be scaled up or down in price and function to allow you to use them as much as you need to and pay accordingly. If, however, you need to deal with more specific forms of data, you may need to have in-house software created or bought out of the box.

Any tool that helps to inform your hiring strategy and compensation package and gives a good predictor on employee behaviors is considered an HR analytics tool. Properly analyzing that data will require an analytics specialist on staff, in order to make the most of it.

While any simple database can collect data, these complex analytical tools allow you to craft specific reports from that data. The reports they generate should be able to be read and understood by your HR staff to inform hiring, compensation packages and other company policies.