2 Why Now?

People Analytics is not a new phenomenon. The study of people at work has been around for hundreds of years and has long been studied in fields such as management science and industrial/organizational psychology. And many companies have been providing reports and metrics about the people who work in their organization for decades. However, the increasing accessibility of data about people, the availability of tools and technology, and the shift in expectations from organizations and employees are new advancements that have led to the rise of People Analytics as a function and career field.

The evolution of people management in the workplace led to the creation of the Human Resource (HR) function. A function that began by merely providing personnel services but then evolved to carrying out operational services in the ‘80s and ‘90s and then to implementing talent management in the 2000’s. Now we find ourselves in a new era where many HR functions are strategic partners in business decisions and drive high-impact strategies with an emphasis on data-driven decision-making. As a result, the needs of HR began to include data, analytics, and a heavier reliance on technology systems. In many organizations, this is where the term “People Analytics” first began to pop up in the 2010s.  By 2019 we saw research from Thomsons Online Benefits showing that the number of teams devoted to understanding people data in organizations grew more than 4x from 2016 to 2019 and by the time 2023 came around a LinkedIn study named “HR Analytics Manager” as the second fastest growing job in the United States. In fact, People Analytics (and its similarly labeled titles) have seen an exponential jump in interest in the last decade – see chart below showing the quantity of global Google search term results by year.

The role of HR professionals has been changed forever. It is no longer a career field free from numbers and data. HR professionals now must be able to define business problems in ways that can be addressed with analytics. They need to be able to analyze, interpret, and translate People Analytics outcomes to implement strategies and inform decisions. According to the Society for Human Resource Management, people analytics is one of the most critical competencies for HR in the coming years.

But People Analytics isn’t confined to HR. This same need for data-informed people practices is bringing business and technology leaders into this world of practice as well. All business and technology leaders must now be capable of making data-informed decisions about people. Leading to a demand for people analytics skills in other job titles and departments outside of HR. The flurry of new standards on human capital reporting such as the International Organization for Standardization ISO 30414 and Securities Exchange Commission (SEC) new rules on human capital disclosures has led to more CEOs and CFOs asking for People Analytics information than ever before. And, if the Coronavirus pandemic taught us anything, it is that we do not have enough information about our workforce to answer important questions about what employees need, how to adjust in times of uncertainty and change, or how to quickly bring together data about people to address unforeseen business challenges quickly. The pandemic showed leaders just how little they knew about the workforce. When a flurry of questions about who needs to work remotely, in person, technology needs, employee wellness, etc. started to pour in, companies became startlingly aware of how little information they had available on these topics. It also shifted the types of questions that organizations needed to answer. In a Deloitte Global Human Capital Trends survey, 85% of respondents rated “people data” as “important” or “very important”, tied for #1 with the need for cross-functional collaboration from the C-suite.

The world becomes more data-driven every moment; Statista estimates the world will generate 181 zettabytes of data by 2025! (That’s 12 trillion 2-hour-long movies streamed in 4k!) And, the world of work is not immune to this data growth. People analytics provides insights into a world full of data, uncertainty, unanswered questions, and ambiguity.