How workforce planning analytics builds stronger businesses
The workforce is the core of every business. And while workforce planning can provide great benefit to the growth and profitability of the organization as whole, many HR groups aren’t taking advantage of a sophisticated planning analytics solution.
The Aberdeen Group recently published Automate through analytics: Unifying workforce planning through a single system of truth. Aberdeen found that when companies move beyond manual processes, like spreadsheet planning, and unify their workforce data using a central analytics engine—they can significantly improve their “ability to understand emerging workforce pressures, fill new and/or existing skills gaps and respond to individual employee performance issues before they affect revenue.”
Why workforce analytics are critical for HR
Aberdeen found significant differences between the capabilities of best-in-class companies and those that have yet to enter the world of data-driven analytics.
Here’s what they discovered:
- 71 percent of companies lack the ability to drive real-time workforce performance insights
- Businesses that deploy workforce planning analytics are 66 percent more likely to increase HR performance efficiency without increasing HR headcount
- Businesses deploying these systems are 4x more likely to increase workforce ROI than those without unified analytics
How best-in-class companies embrace analytics
The companies Aberdeen has deemed best-in-class are streamlining the processes involved in workforce management, talent analytics, benefits and compensation management and payroll automation. A solution like this helps HR teams execute their jobs in collaboration with financial and operational planning, rather than in silos, helping ensure organizational alignment.
Best-in-class companies are turning to analytics to unify disparate datasets and leverage analytical engines to gain valuable workforce revelations. HR pros can then communicate these insights to management as soon as they find them. As a result, these organizations can make more strategic decisions to drive growth and efficiency.
Aberdeen found that for 40 percent of companies, this analytical foundation has already “reduced performance disruptions and helped get the right talent to the right places at the right time, promoting stronger employee engagement and tenure.” In addition, analytics solutions that offer “what-if” modeling capabilities help companies test out assumptions and evaluate alternatives in terms of employee headcount and skills development.
Maximize the ROI of your largest line item
In light of the demonstrable benefits of workforce planning analytics, why are some companies slow to adopt? The fact is that data analytics are not often a typical area of expertise for most HR and workforce professionals. The skill set of many HR professionals includes benefits administration, workforce training and labor relations, but not analytics. An in-depth report on workforce analytics from the Corporate Research Forum observed that, “Historically, HR has not enjoyed a strong reputation for analytical and data-driven practice. It needs to invest in building both skills and a more data driven culture and mindset.”
No doubt the researchers at Aberdeen would agree. And when you consider that labor expenditures are the largest single line item in most business cost structures, improving the ROI on its workforce is one of the best investments a company could make.