When conducting an HR data analysis, beginning with the specific problem you want to address is essential. For example, is your team having trouble retaining top talent in a particular department or geographic area? Are you aiming to optimize workforce costs?
You can answer these questions (and more) with HR data analysis, also known as HR analytics. This process involves collecting and analyzing workforce data to make educated decisions that increase employee engagement, productivity, and overall performance.
This post covers four different examples of HR analytics that can help you drive toward your organization’s goals:
Understanding the difference between these types of HR analytics can help you ask the right questions. If your team wanted to hire more qualified talent, what would be the first step to get there? You’d first need to understand why the talent you’ve hired over the past year wasn’t good enough. What specific skills were lacking? Was there a culture mismatch? Ununcovering these insights is key to building a strategic foundation for planning. Let’s get started.
What it is: Descriptive analytics focuses on summarizing and interpreting historical data to answer the question, “What happened?” This is the foundation of any HR analytics strategy and provides the most accessible way to derive insights from data. By organizing past events and patterns, HR professionals gain a clear picture of workforce trends.
Descriptive Analytics Examples:
Most organizations are still working on getting their descriptive analytics right, moving from basic ad-hoc reporting to systemic, advanced workforce reporting. Organizations may struggle to progress to diagnostic or predictive insights without a solid understanding of the current status quo and historical trends.
What it is: Diagnostic analytics goes a step further by asking, “Why did it happen?” This question helps you uncover the drivers behind trends or issues identified through descriptive analytics. This type of analysis helps HR teams understand the reasons for workforce changes and to address challenges.
Diagnostics Analytics Examples:
Knowing what happened is is the first step, then, understanding why it happened opens the door to uncovering strategic insights. This analysis can bridge the gap between simple HR reporting and more strategic HR analytics.
What it is: Predictive analytics uses historical data and statistical models to answer, “What will happen?” By identifying patterns and trends, HR professionals can forecast future events, such as employee turnover or workforce needs, allowing them to be proactive.
Examples of Predictive Analytics in HR:
Predictive analytics empowers HR teams to move from reactive to proactive strategies, which leads to more agile and resilient teams. However, it requires reliable data and analytics. Misinterpreting predictions or relying on flawed data can lead to incorrect assumptions.
What it is: Prescriptive analytics recommends specific actions to achieve desired outcomes or prevent negative ones. It answers the question, “What should we do?” by suggesting data-driven strategies and interventions based on predictive insights.
Prescriptive Analytics Examples:
Prescriptive analytics typically refers to leveraging AI and advanced algorithms to suggest specific actions automatically. In this context, prescriptive analytics often involves software-driven recommendations that guide users toward optimal decisions based on predictive models and real-time data. While practical examples of prescriptive analytics are still limited, rapid AI development is accelerating its potential for real-world applications.
These examples of HR analytics are the core principles that will guide you on the next step in your strategic journey. By understanding what happened, why it happened, and what will happen, you can begin to make recommendations on what to do next. It’s a practice that takes time, and it’s possible with the right HR metrics.
Learn more about the top HR metrics today or chat with us to see what’s possible with the right people and analytics solution.