The world is swimming in data with both people and machines sharing more information than ever before. The art of capturing and translating data into meaningful, actionable insights is a challenge that many HR professionals are struggling to come to terms with. Last year our roundtable discussion groups ranked data as one of their biggest barriers to driving HR innovation within their organisation.

“Of specific concern is the growing requirement for data analytics capabilities, and the need to provide information to key decision makers more rapidly. The ability for HR to assist in the collection and analysis of different data types will be a key determinant of success in the digital age, as organisations demand faster decision-making to exploit market opportunities and respond to emerging threats.”

Download the 2017 HR Innovation & Tech Fest Research Report here to find out more about the HR community’s top challenges.

Once firmly the domain of techies and data ninjas, analytics has spread far and wide into mainstream business practices. This is something HR Innovation & Tech Fest keynote Josh Bersin noted during the 2017 event:

“During my early days as an analyst, analytics conferences were sparsely populated and mainly attended by techies who were excited about what they were doing but frustrated that their leadership did not understand the value of their work. This has totally changed. People analytics is now a well-known discipline and a must-have domain within HR and IT,” he said.

He believes we’re currently witnessing a shift from analytics as a modelling exercise to analytics as a discipline to give people practical information. And yes, in case you’re wondering…now is the time to start formulating your people analytics strategy.

“Almost 70% of the companies we’d surveyed are very actively involved in building a single system of record to put all their data. The technology is available to do this, so if you haven’t spent the time building a data dictionary, understanding where your data is, getting IT involved, and putting in place data security and governance, you’re going to fall behind.”

For anyone who’s at the early stages of their people analytics journey, or for those just wanting to check if they’re on the right path, Kelly Egan is a great source of information.

Kelly was the HR Director for Atlassian for 5 years before moving to Edrolo, a start-up that focuses on improving education for students. Over her 20 years in the corporate HR world, she’s witnessed the evolution of people analytics first hand. She gave an extremely useful overview of how to get started with people analytics during HR Innovation & Tech Fest 2017. Here is a summary of the insights she shared with us.

4 Steps to Establishing Your People Analytics StrategyStep 1. Get Your Data Right

Step 1. Get Your Data Right

I know from working 20 years in HR that there’s been a lot of organisations – and it’s not always the small ones – where you can pull out some reports and data and question whether you can trust it. If we rely on managers or team leads or employees to update it themselves, what are the chances of that that’s actually going to happen? It’s been fairly minimal, from my experience. So making sure we are capturing accurate employee data should be the very first point of call on your analytics journey. It’s critical that you’re consistently capturing accurate information.

What kind of metrics are you looking for to help the business make decisions? Is it the average to fill a role? Average turnover? Attrition from last year to this year? Does that even matter to the business?

Then you can get a little bit more sophisticated and think about ratios. For example, at Atlassian we look at team compositions to see how many designers we need per developer. Or for your purposes, it might be how many HR business partners per employee, and what impact is that having before you reach burnout levels?

Once you’ve got some data coming out of your system, you can start to look at trends over time based on different teams and different leaders. “How does this compare to last year?”. You can then start to tell a story around the data.

One of the most common mistakes HR leaders make in the people analytics area is jumping from stage one to stage four. This is where your people analytics work can start to collapse, it can be tempting to jump straight into the analysis but the real benefits of people analytics only comes when you work through steps one to three first.

The obvious starting place to find your data is the big, generic chunks of information: salary, employee identification etc. But when you delve a little deeper you may realise you have an overwhelming amount of data already in your systems. From promotions to training to capabilities, to development plans to ratings, to percentages of salary increases over multiple years… you can actually go completely crazy to the point of analysis paralysis, around the buckets of data that you have.

I think the easiest way to look at your data is by breaking it into four buckets.

You may question the importance of some of the elements in bucket 4 such as commute time. But for some businesses the time it takes people to get to work can have an impact on retention/attrition rates, so the lesson is: don’t discount any of your data.

You may look at all this data and start to feel completely overwhelmed by it. Where to from here? The temptation is to share as much data as you can in the hope of producing something (anything!) meaningful. But the real power of people analytics emerges when you can connect your people data with business challenges.

Then you started to get a little bit more sophisticated with it, thinking, “Okay, now I need to tell a better story, linking it to something that I know is really important.”

To know what the metrics and the data that you want to pull out to share with your business leaders, you really need to have that depth of understanding as to what’s going on in the business. If you can use your crystal ball to foresee what the business leaders are going to be looking for in terms of their strategy, you can start to formulate a plan for delivering these insights. Is it about growing the business? Is it about building capability? Is it something with the culture? Once you’ve determined this, you can decide what sort of insights you need to pull from different areas to start telling that story.

The beauty of people analytics emerges when you start connecting your people data with the business challenges. By bringing that together you start to deliver not just data but data intelligence.