HR Analytics 101 | Data-Driven HR Decisions

By OrangeHRM | Published on Nov 30, 2023 | minute read

Are you ready to unlock the power of data and take your HR game to the next level? Welcome to HR Analytics 101, where we dive into the exciting world of data-driven decision-making. We'll explore how leveraging data insights can transform your HR strategies, boost productivity, and help you make smarter choices. 

What Is HR Analytics?

At its essence, HR reporting and analytics involves the systematic analysis of HR data to uncover trends, patterns, and correlations. It's not merely about numbers; it's about deciphering the story that data tells, a story that holds the key to your HR implementation factors including optimizing your HR processes, enhancing employee experiences, and ultimately, driving organizational success through data-driven decision-making. However, according to The Rise of Analytics in HR by LinkedIn, only 8% of companies report that they have actionable data.

Why Data Matters in HR?

Data is everywhere, and HR is no exception. Gone are the days of relying solely on gut instincts and educated guesses. The answer lies in its potential to revolutionize the way you manage your workforce by using techniques such as workforce analysis. By leveraging HR analytics, you gain a comprehensive understanding of your employees, allowing you to tailor strategies that foster a more productive, engaged, satisfied, or potentially re-engage your workforce

The Propulsion of HR Analytics

The recent push towards utilizing the full potential of HR analytics is driven by a number of factors. These factors explain how and why HR analytics is slowly changing how HR professionals approach the future of workforce planning. These factors are:

  • Planning for the Workforce of the Future - Technical expertise is no longer the sole focus. recruiters emphasize adaptability, problem-solving, creativity, and leadership as crucial skills for the future workplace. This point is important when you factor in that more than 73% of recruiters say that hiring someone with a particular skill is challenging according to novoresume. So identifying what your workforce will look like in the future will go a long way in setting up your organization for success. 

  • Growth in HR Technology and Innovation - According to Talenlyft over 70% of employers emphasize that using an ATS has made it easier to process applicants. This statistic goes on to show that over the last five years, there has been a shift from static HR management solutions to dynamic, real-time cloud and mobile-based tools and platforms. Companies now use these highly powerful software solutions to manage and automate their HR processes and derive data from them to make data-driven decisions.

  • An Increasingly Competitive Landscape - HR analytics becomes instrumental in workforce analytics and planning. The foundation set by this will allow companies to compete effectively in the competitive job market. With companies trying to address their needs data becomes all the more important in showcasing trends and predicting where companies are required to be when facing the challenges of recruiting and retaining.

The Types of HR Analytics

There are four types of HR analytics and the implementation of each one depends on the needs of your organization they are:

Descriptive Analysis

Predictive Analysis

Diagnostic Analysis

Prescriptive Analysis

The most basic analysis type that is done is descriptive analysis. Employing statistical analysis techniques to elucidate or encapsulate a specific set of historical, raw data. Your emphasis lies on past data to understand what occurred, without extending predictions for the future. It uses advanced mathematics to identify patterns and improve future workforce planning.

The easiest form of analysis to identify may be a predictive analysis. It involves the use of past data to make future predictions. These predictions can help the HR department in hiring the right people, retaining key employees,  building a better work culture, engaging your workforce, and bridging skill levels.  

A diagnostic analysis involves the next step for descriptive analysis. They use these statistics a step further by using past data and providing an understanding of why they occurred. Diagnostic analysis methods can include:

  • Data drilling
  • Data mining
  • Correlation analysis
  • Regressive analysis
  • Statistical analysis

The main difference here is that they use both internal and external factors to diagnose why these trends, patterns, and inconsistencies have occurred 

A prescriptive analysis is one of the hardest to pull off but has significant advantages. It transfers the data in a predictive analysis and shows you what to do next. In simpler terms, it gives you the course of action on where and how to act for organizational success. The main element here is that a prescriptive analysis predicts the most likely outcome of one choice. It utilizes big data and advanced tools and configurations like machine learning, AI, and algorithms to present you with the options on what you need to do.

 

Why HR Analytics Is Important?

HR analytics is important for several reasons including:

Improving Employee Engagement

Did you know that engaged employees are more productive and less likely to leave? By analyzing data on employee satisfaction, leveraging feedback, and performance, you can identify patterns and trends that impact engagement levels. Armed with this knowledge, you can proactively address any issues, create targeted initiatives, and foster a workplace culture that inspires your employees.

Enhancing Recruitment and Retention

Finding and retaining top talent is a constant challenge for HR professionals. However, with the power of data analytics, you can optimize your recruitment strategies and retention of key employees. Analyzing data on candidate sourcing, hiring success rates, and turnover rates can help you identify the most effective channels, fine-tune your selection process, and implement retention initiatives that keep your star performers happy and motivated. So if you are considering using data, outsourcing Python web development services would be a great idea. Python facilitates data collection for HR by providing powerful libraries and frameworks for web scraping, API integration, and data manipulation, streamlining the process of gathering and analyzing candidate information.

Predicting Future Trends

The ability to anticipate future trends is a game-changer in HR. By leveraging data analytics, you can uncover patterns and predict future workforce needs. Whether it's forecasting skill gaps, identifying high-potential employees, or determining training requirements, data-driven insights empower you to stay one step ahead, adapt proactively, and ensure your organization thrives in the ever-evolving business landscape.

 

Why OrangeHRM?

 

Now that we understand the importance of data in HR, let's explore a revolutionary tool that can put data insights at your fingertips in minutes: OrangeHRM! With its advanced reporting and analytics module, OrangeHRM empowers HR professionals, managers, and IT admins to unlock the full potential of their HR data. Here's why OrangeHRM is the ultimate game-changer for your HR analytics needs: 

Customizable Reports

OrangeHRM's reporting module offers endless possibilities for customization. Tailor reports to your specific needs, selecting the data points, metrics, and visualizations that matter most to you. Say goodbye to generic reports and hello to insights that are directly relevant to your organization's unique HR challenges.

Scheduled Reporting

We understand that time is precious, and manually generating reports can be a time-consuming task. With OrangeHRM, you can schedule reports to be automatically generated and delivered to your inbox at your preferred intervals. Stay updated without lifting a finger and focus your time on what truly matters - strategic decision-making.

Data Visualization

They say a picture is worth a thousand words, and OrangeHRM takes it to heart. Transforming complex data into easy-to-understand visualizations, such as charts, graphs, and metrics, you can quickly grasp key insights and trends. Visualizing data has never been this exciting!

Real-time Analytics

Time is of the essence when it comes to making impactful decisions. With OrangeHRM, you can access real-time analytics, ensuring that you're always up to date with the latest data. Stay agile, adapt quickly, and make decisions based on the most current information.

Data Security

We understand the importance of keeping your HR data secure. OrangeHRM prioritizes data privacy, employs state-of-the-art security measures, and adheres to strict GDPR compliance to safeguard your sensitive information. Rest easy knowing that your data is in good hands.


Armed with the insights we've shared today, you're well on your way to making data-driven decisions that will revolutionize your HR strategies and drive your organization's success. Remember, data is the fuel that powers your HR strategies. OrangeHRM is the engine that turns that data into actionable insights. Start your HR analytics journey today book your FREE demo now!