Data analytics has to be the starting point of every decision taken by the talent management department.

Until recently, HR professionals have been making decisions about how to employ, evaluate and train people based on intuition. A relatively new discipline, People analytics, uses maths and statistical models to draw insights from data to identity and predict patterns that lead to better decision making. People analytics can help organisations understand what kind of skills they need, what is the profile they’re searching for and use the work data available to make talent acquisition.  Additionally, based on information from different departments, performance reports, the people analytics team can help employees to make sure they get fair compensation.

HR analytics, the precursor of people analytics, has its origin in industrial psychology, a branch of psychology that applies psychological theories and principles to improve organisational productivity and employee wellbeing.

Harvesting employee potential is probably one of the most important tasks of the people analytics team.  Through coaching and training, companies can make sure their employees deliver the best possible quality of work, prevent employee turnover and deals increases the likelihood of succession planning. People analytics is used to predict the performance of salespeople by identifying the set of traits that make salespeople successful. Screening candidates for a high-grade point average from a reputable educational institution is no longer an indicator of sales performance. The same principle applies when screening for toxic employees. The company creates predictive models that screen out candidates with character traits conducive to unproductive behaviour in organisations.

Companies have started to increase their spending on people analytics especially when they’re looking to vendors that offer well-developed solutions that include dashboards meant to show employee performance, turnover, and opportunities for growth.

The quality of the insights depends on the accuracy of the data. In many cases, organisations have to reconsider how data is gathered, stored and leveraged. It also means that companies are transparent in how they use data and the fact that they protect employee privacy.

The trend towards analytics in HR will continue to evolve in the coming years. The Deloitte Global Human Capital Trends survey shows that in 2018, 82% of companies consider people analytics an important factor in the success of a company, compared with 69% in the previous year.