A recent study by HR.com's HR Research Institute (HRRI) sheds light on the current state of people analytics within organizations, revealing both advancements and persistent challenges. Despite progress in data gathering and evaluation, a mere 22% of companies feel they are 'very' or 'extremely' effective at maximizing their HR analytics potential. This highlights a significant gap between the collection of HR data and its practical application in informing business decisions.
On the brighter side, the study notes an improvement in data evaluation skills among HR professionals, with 50% now rating their organization's capabilities as 'good' or 'very good', up from 36% in 2021. However, the integration of business data with HR data remains a major hurdle, with only about a fifth of organizations consistently achieving this. This limitation prevents a holistic view of the workforce in relation to broader business goals.
The study identifies three primary challenges in people analytics: integrating disparate data sources (47% of respondents), implementing programs based on analytics-derived decisions (41%), and the distribution and communication of data (33%). These findings underscore the difficulties organizations face in translating HR data insights into actionable strategies that drive business outcomes.
Debbie McGrath, CEO of HR.com, emphasizes the need for organizations to focus on making data-driven decisions that yield real business impact. The study's implications are significant, suggesting that companies which overcome these challenges could gain a competitive advantage through more informed workforce decisions aligned with business strategies.
For HR professionals and business leaders, the study highlights the importance of investing not only in data collection and analysis tools but also in the skills and processes needed to turn insights into action. As people analytics evolves, organizations that navigate these challenges successfully are likely to see improved workforce management and better business outcomes.
Further insights and recommendations are available in the full research report, HR.com's State of People Analytics 2024-25, and a recorded webcast presentation, How to Boost People Analytics Effectiveness in Your Organization, offering guidance on enhancing HR data practices.
