Business intelligence helps us make decisions about how to attract and retain the best customers, and how to create happy customers who are loyal to us and give us the greatest share of their wallet. From basic demographic data on customers to behavioral data about what they do and say, data analytics is used to predict future behavior. All of this helps us make decisions that have measurable, positive impact on our business results.
If we can do all this with customer information, can we use the same principles and apply them to a different group of people – our employees? That’s exactly what leading edge companies are doing to gain competitive advantage, according to the lead article in October’s Harvard Business Review. Instead of customer loyalty, they may analyze employee engagement, but the principles are very similar, as are the goals – to link investments in human capital to returns on financial capital, and to provide information that helps managers make strategic human capital decisions that have a long-term positive, measurable impact on the business.
The article describes a ladder of increasingly sophisticated human capital analytics that organizations may use to answer critical questions about talent:
1. Human Capital Facts - What are they key indicators of my organization’s overall health?
2. Analytical HR – Which units, departments, or individuals need attention?
3. Human Capital Investment Analysis – Which actions have the greatest impact on our business?
4. Workforce Forecasts – How do I know when to staff up or cut back?
5. Talent Value Model – Why do employees choose to stay with – or leave – my company?
6. Talent Supply Chain – How should my workforce needs adapt to changes in the business environment?
For companies that want to get the greatest return on their investment in human capital, these new analytics can help make sure that investments are made in the right people and programs that will lead to high performance of both their employees and their business overall.
Spotfire Blogging Team
Image Credit: Microsoft Office Clip Art