The Future Of Human Capital Lies In Data Analytics
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When people think about Human Resources (HR), the first thought that comes to mind is often a department that handles personnel hiring and salaries. However, over the years, HR has transformed and is now a function that closely aligns with a company's strategic plan and vision. Some even refer to the function as Human Capital (HC) and not HR anymore.
For HC to help organizations achieve their strategic goals, it needs to not only manage people, and develop existing talent but determine hiring needs and look into workforce trends to enable future success. To hire the right people for the right job, and at the right time, organizations are increasingly looking into data analytics as a tool to address a wide range of business challenges including, first and foremost, recruiting, followed by performance measurement, compensation, workforce planning, time to hire and retention, among others. As the market becomes increasingly noisy, we believe the next wave of recruiting lies in the use of data-driven insights to power talent decisions. This is what Talent Intelligence is all about - a new way to harness data and insights to reinvent and improve every step of the recruitment process by combining these insights with the right instincts to deliver the winning talent strategy.
Skills required to get the job done
The insights gathered not only provide intelligence to talent strategies but can also help highlight the skills gap that exists within an organization, pointing to the skills that are most in demand amid the revolving talent landscape. For instance, recently released LinkedIn insights revealed that recruiters are looking for people with soft skills, such as creativity, adaptability and collaboration. Let’s make it clear: hard skills matter, however with the rise of automation and artificial intelligence, it means that hard skills alone are no longer enough to be successful.
According to our Global Talent Trends report 2019, wrong hires are almost never a matter of hard skills alone; and talent professionals are aware. In fact, 89% of respondents feel that “bad hires” typically have poor soft skills. This is why, increasingly, they prioritize soft skills alongside hard skills during the hiring process.
Trying to recruit very specific people with such hard-to-define skills is an issue that many CEOs face and can be addressed with data analytics. Having access to predictive talent models means that business leaders can more effectively and efficiently find, recruit, and retain the right people. It can also help to identify current pain points in the organization and discern where to distribute future investments.
Adoption of HR analytics to make informed hiring decisions
In addition, based on LinkedIn’s Recruiter Sentiment Survey, the need for high-performing talent in the Middle East has never been greater. It is only natural that HR professionals are turning to workforce analytics tools to make smarter, data-driven business decisions. With real-time insights collected from more than 610 million LinkedIn members and 30 million companies, LinkedIn Talent Insights offers a whole new level of transparency to the talent marketplace and helps HR professionals plan for current and future hiring needs.
According to LinkedIn's The Rise of Analytics in HR report, the adoption of specialized HR analytics in EMEA has been strong in the last five years. Overall, 19% of companies have adopted HR analytics, and 12% have dedicated HR analytics roles. Finance and legal are the industries with the most widespread adoption of HR analytics. However, this investment is concentrated, and overall adoption of analytics is still low.
For those organizations that are looking to get started with HR analytics, they will firstly need to prioritize key areas of the business. As a result, those who implement an analytical approach to address business issues in key areas will have a much stronger outcome than attempting to apply analytics across the board.
The outcome of implementing insights tools therefore allows the creation of a narrative that elevates HR’s position with senior leadership. It results in improving the business strategy overall by providing the counsel on the talent strategy. Looking into products that deliver direct access to rich data on talent pools and companies can help businesses stay two steps ahead in today’s fast changing talent landscape. The most important step would be creating a culture and mindset that is data-first, where data-driven thinking is rewarded and appreciated— and where change is delivered from the top.
One way or the other, there is no denying that HR analytics is here to stay and there can be no thriving future for HR or HC without analytics as its foundation.