The Data Treasure Trove of HRMS Analytics
HRMS Analytics or Management Information (MI) is a key benefit of having HRMS software. Since you are already storing the data, analytics are a cost-effective way to extend the value of your system. As well, effective analytics and reporting will allow you to raise the profile of your system as a useful tool for HR decision making, along with providing a basis for decision making for business leaders outside of HR too.
Analytics Can Tell a Story, If You Understand the Language.
One of the advantages of having an HRMS is the availability of large amounts of raw data, or that you can combine this HR data with other data sources. Talented HRMS analysts can slice and dice the data within HRMS analytics to discover trends and anomalies, allowing for proactive decision making. If the majority of your locations or offices have the same turnover rate as measured over time, and suddenly it drops massively at one site for three months, this trend can be easily noticed through reporting. It is then helpful to analyze, is this due to local business policies, good managers or some other business reason that can be duplicated in other offices to replicate the success?
HRMS Metrics are not only historical static data or headcount reports, but can and should be used as a basis for future decision making. For example, if you make a business decision to move the date of vesting for a 401k plan for new employees, how will this impact new hire turnover? If you have the data in place, you should be able to perform some analysis and get an idea of how turnover will change if you move vesting date. It would be helpful to know how many employees leave one day after vesting? If you see a strong correlation within HRMS analytics, you can be assured that moving the vesting date will impact the date your employees are leaving rather than basing the decision on a gut feeling or indirect science such as employee surveys. While employee surveys can be helpful especially when anonymous, the data produced HRMS software will never lie or hold back.
“How do I get started with HR analytics?” I hear you ask. It is useful to define your HRMS requirements: what types of issues are you seeking to address? What would you like to understand from the data? Then, it is best to start to compile your baseline data landscape and to re-visit periodically, to ensure that your metrics are still supporting your needs and providing that much-needed insight.
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