2 Why Now?

People Analytics is not necessarily 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.

The increasing accessibility of data on people, the availability of tools and technology, and the shift in expectations from organizations and employees are new advancements in People Analytics. Emerging technologies have a significant impact on how HR professionals and business leaders are able to work when it comes to gathering, using, and applying insights from data.

While some technology, like advances in machine learning and artificial intelligence, may make it easier to automate some of the recurring tasks that past reporting on human data may have included, they are also creating a shift in what is needed from HR professionals. HR professionals now must know how to define business problems in ways that can be addressed by analytics, interpret, and translate people analytics outcomes, and learn analytical thinking skills that allow them to implement strategies and inform decisions with the outputs of people analytics. Simultaneously, as the need for smart people practices combines with the need for data informed and technology supported solutions, it is bringing business and technology leaders into a world previously held solely by HR professionals. We find ourselves now in an era where HR professionals must be data-driven leaders and where all business and technology leaders must be learned in people strategy.

The evolution of people management in general has led to a maturity in which HR organizations have evolved from merely providing personnel services, to carrying out operational services in the ‘80s and ‘90s, and implementing talent management in the 2000’s. Now we find ourselves in a new era where the HR function is a strategic partner in business decisions driving high impact activities with an emphasis on data-driven decision making and the needs of HR can no longer be met without data, analytics and technology systems. Welcome to the age of people analytics!

In the Deloitte 2018 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. 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 we saw a LinkedIn study name “HR Analytics Manager” as the second fastest growing job in the United States. In fact, people analytics (and its similarly labeled titles) has seen an exponential jump in interest in the last decade – see chart below of ‘global Google search term results by year).

According to the Society for Human Resource Management, people analytics is one of the most critical competencies for HR in the coming years and the need will likely continue to climb in light of new laws and regulations requiring the disclosure of human capital metrics in the U.S., China, U.K and more locations to follow.

For these reasons we have seen people analytics become an in demand job all on it’s own, but also be listed as a skill desired in individuals who work in other job titles or 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 questions about the value of the workforce that ever before. People analytics is the answer to meeting this demand to answer the myriad questions about the workplace with data-informed evidence.

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 really 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. Once employee listening was mostly focused on understanding whether employees were engaged with their work or were likely to quit or not. Now, the dialogue has shifted to understanding employee wellbeing, concerns, and stress management. Where once performance was the subjective measurement task of a manager, now a slew of technology is being implemented to measure productivity, performance, burnout, collaboration and more.

The world is becoming more and more data driven every moment; Statista estimates the world will generate 181 zettabytes of data by 2025! (That’s 181 billion terabyte hard drives of data or 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 for a world full of data, uncertainty, unanswered questions, and ambiguity – now is that time.