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Talent analytics has the potential to propel HR into the future but challenges persist, reveals CIPD research launched at annual conference.

A complex mix of silos, skills gaps and suspicion are preventing HR from tapping into the big data and talent analytics revolution to better inform the function’s strategy and measure its impact. That’s according to new research from the CIPD, the professional body for HR and development, in association with Oracle Corporation EMEA. 

The term ‘talent analytics’ refers to the use of data streams within HR to drive insight on everything from engagement to e-learning. This is already firmly on the agenda of many in HR.   ‘Big data’, on the other hand, refers to the diverse streams of information on people and demographics - and the exciting ability to use this and unstructured data to gain fresh perspectives on people and performance is still in its infancy.

By exploring several examples of current practice and drawing on survey evidence, “Talent analytics and big data – the challenge for HR’’ confirms that big data and talent analytics can help HR take a more forward-focused and evidence-driven approach to things like workforce planning, talent management and people development. But, as HR seeks to engage with this combined people analytics challenge, there is concern about the reliability and credibility of its data, obstacles posed by existing structures and systems which work against the sharing of data (silos), and capability gaps (skills). In addition, the research identified some cultural barriers which can subtly undermine the people analytics effort (suspicion). 

The research, launched today at the CIPD's annual conference in Manchester, revealed that system and structural silos, both within HR and with other functions, prevent many HR teams from getting timely and efficient access to data. Meanwhile, many organisations are grappling with how to build the capabilities required to define and analyse data relating to its people – should the HR teams be up-skilled, or should specialist skills be brought in? Finally, cultural barriers are also preventing HR from reaching its true potential in this field: these include biases and beliefs about where HR’s expertise lies, as well as a fear that data might reduce human beings to units of measurement.

The solutions to these challenges are both strategic and tactical, suggests the research. From a strategic point of view, people analytics needs to be at the centre of business priorities as well as HR’s own priorities in terms of capability building. On a tactical level, HR must:

• Identify the skills it needs
• Source more key talent with backgrounds in fields such as psychology, economics and other social sciences to supplement the usual reliance on data engineers
• Develop analysts who understand and connect with the people agenda and are capable of translating data into actionable insight.

John McGurk, Head of CIPD Scotland and author of the research, comments: “HR’s people analytics capability is patchy. Even those that we consider to be at an advanced level are reluctant to say they are pushing the boundaries. Most are still defining their approach towards metrics, with a focus on ensuring key HR data on businesses drivers and costs are reliable and consistent. Those with more confidence in their data are now focusing on how to use that data to credibly inform business decisions by demonstrating the impact of people on performance.”

“Scepticism about whether a data-driven world would be a better one still abounds. Some HR practitioners feel that analysts are not sharing enough data or insight, and are operating without a full understanding of the purpose of analysing people data, leading to a ‘bean counting’ approach to the measurement of people. Meanwhile, some analysts feel that HR practitioners are not asking the right questions. This is a healthy tension, but one which must be resolved if HR professionals are to fully embrace the talent analytics revolution, which is already central to business conversations.”

This report, which can be downloaded here, will help to inform the CIPD’s Valuing Your Talent work with UKCES, CIMA, CMI and RSA, which has also been launched today. This initiative is focused on delivering a common language and set of high level frameworks for the measurement, benchmarking and reporting of human capital data – with clear relevance to and potential to learn from the big data agenda. For more information visit cipd.co.uk/valuingyourtalent