Report: HR Lags in Using Data to Make Decisions

By Aliah D. Wright Jun 13, 2017
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​Although 83 percent of HR leaders agree that all people decisions should be based on data and analytics, just 37 percent use data to solve people management problems, according to Becoming a People Company, a survey report from software company Sage People.

"HR is playing catch-up when it comes to data," said Sage People Executive Vice President Adam Hale in an interview with SHRM Online, and that's hampering its ability to create informed strategies for its businesses.

Research company Insight Avenue, on behalf of Sage People, polled more than 500 HR leaders in the United States and the United Kingdom at organizations with 500 to 2,000 employees in the IT, financial services and business professional services sectors.

The results were released in May.

"We've already seen sales and marketing teams go through a data science transformation over the last decade with great success, using insights to better understand and engage with their customers," Hale said. "Now it's critical HR follows suit and embraces people science to better understand their people."

Although much has been written about data science and how it has helped companies, many people decisions are still not data-driven—"even though leaders recognize this should be the case," the report states.

Among the other findings:

  • 92 percent of companies are struggling to get the strategic insight they need to solve retention problems and other issues.
  • 59 percent don't currently have a system in place to monitor employee engagement.
  • 46 percent of respondents struggle to make better use of people data.

Data Could Aid Decision Making

Hale said that because nearly two-thirds of HR leaders are not using people data to support HR decision-making or to inform strategic planning, "if asked to do so today, more than 60 percent of those questioned would have difficulty sharing with their CEOs their companies' current skills gaps, the likelihood of specific employees leaving and overall employee churn."

These findings come as the skills gap in the United States continues to grow across industries—especially in the technology field. That gap has led many employers to consider hiring tech workers from other countries, such as H-1B candidates. Yet the ability to recruit foreign talent has become harder as H-1B visas fall under greater scrutiny, as SHRM Online previously reported. Companies now have to submit additional evidence to prove that jobs are complex or specialized enough to qualify for such visas.

"There was a previous presumption that a computer programmer was a specialty occupation, which would qualify it for an H-1B," said Justin Storch, manager of agency liaison at the Council for Global Immigration, an affiliate of the Society for Human Resource Management, in the SHRM Online article. "That is no longer the case."

[SHRM Resource: Customized Benchmarking Reports]

HR Data Proves Valuable

Combined with ever-increasing competition around attracting and retaining the best workers, these gaps in people knowledge and strategy are especially concerning for organizations that seek to grow and be more efficient.

"Using every lever available to improve performance is the key to rapid business growth," Hale said. "The challenge is putting systems in place to collect and analyze HR data for tangible benefit—31 percent of respondents revealed they don't currently have the right technology in place to interpret people data."

That echoes recent research from Sierra-Cedar, an IT services company. According to the results of the 2016-2017 Sierra-Cedar HR Systems Survey, "the most popular tool for business intelligence and HR analytics is still Microsoft Excel, with 98 percent of organizations using it for HR analytics efforts."

As Stacey Harris, vice president of research for Sierra-Cedar, told SHRM Online, "You can't do 'big data' with Excel. It's just not going to work." She added that most organizations don't have the newest tools and technologies to take a deeper dive into HR analytics.

Said Hale: "Using the right HR technology to gather and analyze people data from digital reviews and employee engagement surveys is very valuable in identifying gaps and potential churn. With these data processing tools, HR can better use the available data to understand what employees want and take action to provide great workforce experiences that fuel productivity and business growth."

 

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