Organizations across diverse industries have only just begun to tap the potential of big data. They are beginning to understand why and how it is a disruptive technology. Big data analytics (or advanced analytics), is empowering these organizations to make more informed business decisions. One area where companies are starting to realize the potential impact of advanced analytics is in human resources (HR).
HR departments are now embracing the era of big data. Most HR managers comprehend that today’s technologies are able to leverage partial volumes of some types of digital data. But, many of them know that the full promise of big data cannot yet be fully achieved due to the current constraints of existing technologies.
Yet, they are also starting to see that there are areas of the HR process for which key data can already be easily accessed, extracted and presented for analysis.
Mashable’s James O’brien recently detailed the important role big data is beginning to have during the recruitment stage. In particular, certain vendors are now able to extract and present social data on job candidates that can be easily interpreted and leveraged by recruiters. Open and accessible information on social media sites, is now being mined and married with data science to help identify candidates that best meet employers’ needs.
While the hype about the promise of big data is justified, most HR managers have begun to realize that they need to temper their enthusiasm about its potential applications in HR.
There are three things HR executives need to bear in mind when evaluating how big data fits into their current and future operations:
1. Current Technological Constraints
Some HR managers have been proactive enough to focus on improving their big data systems. However, they have often come to realize that their current technological infrastructure does not offer the scalability or security to handle huge volumes of data.
Beyond that, even the most advanced computers and large servers on the market are not yet capable of unlocking the full potential of big data. Today’s technologies do not offer the full capabilities to compile, arrange, interpret, convert and report all types of big data that exist in a variety of digital forms.
2. The Need for People Analytics
In recent years, HR executives have understandably exhibited a rapidly growing interest in analytics technology. Their enthusiasm for analytics has naturally coincided with the buzz surrounding big data and its potential applications for HR purposes.
Earlier this year, professional services firm Towers Watson surveyed 1,048 organizations around the globe about their growing interest in HR data and analytics. In its 2014 HR Service Delivery and Technology Survey, the firm found that 28 percent of surveyed organizations “built or further invested in an HR analytics function” during the 18 month-period that preceded the survey.
And according to Information Services Group’s (ISG) Human Resources Technology and Service Delivery Trends in 2014 report, 10 percent of the 199 global companies that it surveyed said that they had already “fully implemented” analytics and dashboards technology solutions.
Most likely, this trend will only continue to grow. 51 percent of the 199 companies ISG surveyed indicated that they plan on adopting “analytics and dashboards” technology solutions “within the next two years.”
Yet, the rapid adoption of advanced analytics solutions creates a new huge problem for HR departments.
Currently, most HR offices are not staffed with enough qualified talent who can handle working in a data and analytics-rich environment. The majority of HR departments do not have the analytical manpower required to leverage the data and intelligence gained through using these solutions.
All too often, it is left up to under-qualified frontline staff to take on the daunting task of processing and interpreting this data. And in certain cases, depending on how effectively the vendor presents the data, these same HR staffers find themselves trying to navigate through the confusing clutter of large and disparate data sets.
Most organizations are severely lacking the competencies and skill-sets needed to optimize HR analytics.
Last year, the American Management Association (AMA) produced findings in its Conquering Big Data study that only further validated this assessment. The AMA surveyed 789 businesspeople in more than 50 industries about “analytics needs in the workforce.”
Respondents were asked to rank the analytical ability of the human resources team at their jobs. 50.4 percent of those surveyed said it was “basic”, and 16.7 percent ranked it as “poor.” While six percent of the respondents said that the analytical ability of their human resources team was “nonexistent.”
Moreover, it is estimated that there will be a significant scarcity of analytical talent for organizations to recruit over the next several years. In 2011, the McKinsey Global Institute projected in its Big data: The next frontier for innovation, competition, and productivity study that “demand for deep analytical talent in the United States could be 50 to 60 percent greater than its projected supply by 2018.”
In this new era of big data, it behooves most HR managers to proactively address the dearth of analytical talent in their departments. HR executives need to provide their frontline staff with training and education on how analyze and interpret complex data. Organizations need to invest in enhancing the analytical acumen and critical thinking skills of their HR staff.
Finally, HR departments need to commit resources to hiring specialists like data scientists and analytic modelers, who can pinpoint key data and identify optimal applications for the data.
3. Limits on the Accessibility of Information
Amid all of the excitement that has been building about big data, it is important for HR executives to know what types of digital data are accessible. By understanding what types of data are accessible, HR leaders can shape their advanced analytics program to address areas of need. What is more, they can focus on which stages of the hiring process could benefit from using analytics technology.
Within ISG’s aforementioned study, the respondents stated that “recruitment sourcing and selection” and “workforce analytics” were two areas that added a fairly high value to their enterprises. They also identified them both as areas that were “possible outsourcing candidates.”
As a consequence, many recruitment Software-as-a-Service (SaaS) providers are now advancing their solutions to both capitalize on the promise of big data, and respond to the aforementioned growing demand for analytics.
The potential of big data holds many exciting possibilities in recruiting phase.
Yet much of the kind of information that is needed on a job candidate, who is in the more advanced stages of the hiring process, is not always accessible to automated advanced analytics solutions. Both federal and state laws have imposed certain limitations on accessibility to certain types of personal information.
While big data and analytics is increasingly being used for identifying and recruiting job candidates, the laws around accessibility of information necessitate that employers seek out other approaches for acquiring the kind of intelligence they typically need about candidates who are further along in the hiring process.
For instance, an employer cannot attain data, via an automated advanced analytics solution, to verify a candidate’s employment or educational history. This type of information can be efficiently acquired by partnering with an employment screening solutions company. An employment screening provider can manually research these categories of information that candidates often embellish on their resumes.
Therefore, it is important that HR executives understand that much of the information that will be needed on job candidates is still not accessible through big data collection/advanced analytics solutions.