Building HR's Influence Through People Analytics

The HR function faces high expectations, but its strategic influence doesn’t always match. People analytics has been quietly changing that.

HR leaders are increasingly expected to identify workforce challenges, communicate actionable insights, and influence decisions at the highest levels of the organization by using data to connect HR priorities to business outcomes, rather than intuition alone.

Leaders who’ve leaned into data say it has strengthened the HR function. “It’s pushed our department to the forefront, because when you have the data, you have more power,” said Jen Paston, vice president of talent and people at Roofr. 

Yet many organizations have not tapped into data’s potential. According to a Korn Ferry survey of 750 global HR leaders, only 18% of CHROs believe that their organizations consistently use data analytics to drive better business decisions. This presents a timely opportunity for people leaders to strengthen data literacy and, in turn, their influence within the business.

Elevating the HR Function

Paxton’s push into data literacy started with curiosity. She had a hunch managers weren’t rigorous enough in their performance-review scoring and asked her team to analyze the last review cycle. That was particularly concerning as the company prioritized upskilling: Inflated ratings could obscure the very skill gaps the organization was trying to address. “The data indicated we needed to reset our bar.”

Since then, she’s bet big on data and, in turn, put HR in a better, stronger position within the organization. “We're not seen as a cost center anymore. We're seen as a data-driven leader,” Paxton said. That shift has also earned her greater respect by allowing her to speak not only from experience but also from what the data shows.

It has also given Paxton more visibility across the organization. “I am seen as someone who can embed themselves in every department and understand the inner workings of each one. That's because of the data.”

Stretching HR’s Impact

People analytics can strengthen core HR practices, including talent acquisition and employee engagement. That significance should not be overlooked: A SHRM survey of 116 CEOs found that attracting top talent and engaging employees ranked among their organization’s top priorities for the next 12 months.

The impact doesn’t stop at talent strategy. People analytics can also shape business strategy. At Roofr, people analytics has influenced how the company thinks about building its products and adopting new technology, said Paxton. 

That influence has reframed how Roofr’s R&D function works, changing meeting cadences, job descriptions, and upskilling recommendations, Paxton told us. 

It’s also informed organizational design, particularly as AI adoption reduces workloads. For the teams most affected by AI, Paxton and her team explored how to redeploy employees’ skills across other departments, connecting workforce planning to business needs. “We’re developing a whole new department based on unlocking some of the team's time,” Paxton said.

Making a Stronger Case with Data

Strong communication is essential to position HR as a strategic leader, yet 34% of CHROs say fostering clear and effective communication is one of their top organizational challenges. Data can give HR leaders something to lean on and help strengthen their message.

“When you're in a meeting and have data to make your case, it’s vindicating because the naysayers cannot naysay the data you're showing them,” Paxton said. “Leaders will trust you if you have the data.”

Still, there will be times when other leaders look at the same data and draw a different conclusion. That’s when Paxton falls back on her experience, which she views as an additional data point — even if there’s no graph to show for it.

Ultimately, quantitative data and qualitative insight both play an important role in persuasive communication. HR professionals who know how to use both can build a more compelling case for business decisions and strengthen their strategic influence.

This makes stronger data capabilities increasingly important, especially as 74% of CHROs say their HR analytics capabilities are basic or descriptive only.

Developing Data Fluency

Organizations increasingly value HR professionals who can connect HR metrics to organizational outcomes. But building data literacy often requires dedicated expertise. Even so, only 30% of organizations that use people analytics have an employee, department, or division dedicated to this function, according to SHRM research.

At Roofr, Paxton recognized that becoming more data fluent meant having someone focused specifically on the data. The company elevated an analytically minded employee from an administrative role into a specialist position, with 50% of their time dedicated to people analytics.

“Having somebody who is data fluent might make or break your people team,” Paxton said. “If I didn't have them, I would be struggling as a leader.”

Leading with Data and Instinct

As organizations become more data-driven, people leaders who can connect workforce insights to business strategy will become increasingly indispensable. That will require more than data. It will take compelling storytelling, strong data governance, and — above all — curiosity.

It also doesn’t mean abandoning the gut instinct you’ve spent years honing through experience.

“For HR leaders under pressure to make faster, more strategic, and data-informed workforce decisions, you're still going to need to leverage your instincts,” Paxton said. “There are many ways to interpret the data, and your instinct still needs to be your guide.”