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Defying the Odds of HR Through Human Capital Analytics

Enterprise_Mobility-475239-editedHuman Capital Analytics (HCA) is one of the greatest opportunities available to organizations in today’s data-driven world. Companies that leverage this intelligence have outperformed those who haven't by thirty percent. Despite its availability, many organizations are not even considering HCA to influence their HR decisions. 

Studies have shown that a prudent use of HCA (also referred to as talent analytics) can maximize employee productivity, increase motivation, reduce turnover and ultimately improve the organization’s overall performance and profitability. Basically, HCA can greatly increase the chances of an organization to achieve its full potential by maximizing the output of its human capital.

The Proof is in the Data

A survey carried out by Deloitte found that only 14% of the 435 organizations surveyed had any form of HCA system in place. Of those, only 4% believed that they had predictive talent analytics capabilities. A full 84% reported not having any HCA system or capabilities.

The most interesting fact is that the 84% reported having data-collection and storage systems in place. This means that they already had the potential to carry out human capital analytics. But they weren’t. As such, they were being outpaced by those which were actively using HCA. The survey reported that – other factors being considered constant – companies using HCA outpaced those not using it by 30%

Why HCA Isn't Used

The ultimate question is: given the potential benefits of HCA, why aren’t many organizations utilizing it? Well, according to Professor Dana Minbaeva of the Human Capital Analytics Working Group (HCAWG), most HRs simply don’t know about the impact of HCA. The reason for this is that research studies carried out on HCA don’t reach companies because they are published in academic journals which the typical HR doesn’t read.

Even HRs who know about HCA think that it is extremely expensive or complex to implement. As such, most of them simply refrain from even attempting to implement it – especially if their workforces are doing just fine. 

Benefits of Using Human Capital Analytics 

What such HRs don’t realize is that Human Capital Analytics is quite easy to implement in today’s world thanks to the popularity of Big Data. A typical HR department already has a system for storing different kinds of employee data. As such, implementing HCA is simply a matter of organizing, integrating and analyzing the data. It is certainly not as difficult as they imagine it to be.

So, how can an HR who desires to enjoy the benefits of HCA get started? Well, the first step is to fully appreciate what those benefits are. This will give the HR the motivation needed to implement an HCA mechanism. It will also give them the ammunition necessary to convince any skeptics within the organization of the viability of HCA. 


Evidence-based decisions

The first benefit is using data to make evidence-based decisions. HCA also provides an accurate mechanism for evaluating the impact of HR decisions. This is because it correlates data from different aspects of HR. 


Strategic planning

Another benefit is predictive analytics which enables HR to carry out strategic planning. Using predictive analytics, HRs are able to accurately anticipate upcoming opportunities or challenges. They can then plan accurately to exploit the opportunities and tackle the challenges. Ultimately, HCA improves the quality of planning.


Culture of performance

HCA can also create a culture of performance within an organization. It enables employee performance to be accurately measured. When employees realize that their performance is being measured, it can act as a motivator – especially when HCA is combined with perks for high performers.


The bottom line is that HCA can ultimately maximize the potential of an organization’s workforce. It can do this while simplifying the life of the HR. Basically, it is a win-win for everybody. The ultimate question is: how can an organization go about creating a HCA mechanism? For that answer, you'll have to check out part two of this two-post series. 



Brett McIntyre is the Digital Marketing Manager at Crimcheck, the leading pre-employment background check company. Including criminal checks, driving records, drug screening, employment history and medical sanctions checks. Helping HR and Staffing professionals daily.

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