A newer and possibly more critical area where both qualitative and quantitative data is making a difference is talent analytics. At its most helpful, it takes the guesswork out of hiring the right talent. Talent analytics doesn’t just help you get the a warm body in a seat, either. This data can help recruiters and companies ensure a talent match where only the most motivated and those inspired to do their best work get to sign on the dotted line.
Simply put, when it comes to world-class recruiting in an increasingly competitive business world, talent analytics is playing a central role and making HR and recruiting work smarter. Using this data properly will dramatically transform the way you approach hiring. Think of it as a crystal ball for your workforce.
That said, understanding what the right metrics are for your business will be the key to narrowing down where best to focus in order to pinpoint the team members who will be the best fit and ultimately make you more successful.
What ARE Talent Analytics?
Talent analytics is the term for a data-focused approach to decision making regarding your current and future employees. By analyzing past employee behavior to predict future performance, talent analytics (sometimes called human capital or people analytics) is often used by HR, hiring managers, and recruiters to find the best type of candidate.
In a Harvard Business Review article about competing on talent analytics, Tom Davenport, Jeanne Harris, and Jeremy Shapiro outlined six types of data used for managing a workforce:
Human capital facts: The key indicators of the business’s health, such as head count, turnover rate, and employee satisfaction.
Analytical HR: Segmented data on the units, departments, and individuals that most need attention.
Human-capital investment analysis: Tracks the activities that have the largest impact on your business, such as how employee satisfaction results in higher revenue, lower costs, and greater employee retention.
Workforce forecasts: Identifies and predicts the best times to either ramp up or cut back on staff.
Talent value model: Provides information on why employees want to stay in an organization or why they choose to leave.
Talent supply chain: Predicts out how to best staff a company according to changes in the business.
Why Talent Analytics Matter
Using the data gathered from your current workforce can drastically improve your ability to make smarter, faster decisions when recruiting talent. As I mentioned in a recent , relying solely on your gut to make a hiring decision is a mistake.
I like to compare talent analytics to the more commonly known practice of sports analytics, which was made famous by the book and film “Money Ball” and transformed the way professional baseball teams recruit talent. Instead of relying on their gut and old-fashioned scouting, Billy Beane and Peter Brand transformed recruiting by using sabermetrics.
The Oakland Athletics used empirical analysis baseball statistics to measure in-game activity and thereby predict future performance. Once laughed at by old-school baseball managers, sabermetrics are now used by every team in the Major Leagues.
Just like Beane and Brand, organizations can use talent analytics not only to hire the right people, but to structure work to align with the company’s strategy and employee capabilities. Decisions on how and where human capital should be allocated across the organization are much more reliable. Motivating individual employees becomes easier and understanding what new talent is needed is no longer guesswork.
Talent Analytics: An Art or a Science?
As much as I strongly believe in the power of data, I would never advise someone to rely solely on data to quantify a human being. Your employees are multi-faceted human beings, not simply numbers and data points.
In my opinion, stellar recruiting is an art as much as it is a science. Using data and analytics as business intelligence is fundamental, but your value judgment must also play a role. If talent is a natural ability, quantifying it precisely is impossible. Plus, talent doesn’t (usually) stagnate, it grows and changes, so you will need to take that into consideration when viewing data.
Coordinating across a few areas of talent analytics takes some thought, but these days, having a plan that connects the day to day of your HR or recruiting team to larger goals and trends isn’t a “nice to have,” it’s a must have. At the end of the day it all starts with why, and what’s most important to your company. Once you’ve answered those questions talent analytics can help you measure everything you do, and leverage data that’s probably already there, waiting to be looked at.
Meghan M. Biro is a globally recognized Talent Management and HR Tech brand strategist, analyst, digital catalyst, author and speaker. As founder and CEO ofTalentCulture and Co-Founder of the #TChat World of Work Community, she has worked with hundreds of companies, from early-stage ventures to global brands like Microsoft, IBM and Google, helping them recruit and empower stellar talent. Meghan has been a guest on numerous radio shows and online forums, and has been a featured speaker at global conferences. She is a regular contributor at Forbes, Huffington Post, Entrepreneur and several other media outlets. Meghan regularly serves on advisory boards for leading HR and technology brands. Meghan has been voted one of the Top 100 Social Media Power Influencers in 2015 by StatSocial and Forbes, Top 50 Most Valuable Social Media Influencers by General Sentiment, Top 100 on Twitter Business, Leadership, and Tech by Huffington Post, and Top 25 HR Trendsetters by HR Examiner.