The future of remuneration analytics and data-driven decisions
HR departments are leaner than ever, but expected to be more efficient. You have to report to management about potential payroll costs savings, whilst hiring and retaining the best people. You have to embrace an increasingly digital workforce and flexible workplace, whilst addressing the demands of employees as consumers. How will HR practitioners succeed in an increasingly complex environment?
Chances are, your HR team isn’t yet perceived to be a dynamic, integral part of the business. The 2016 Mercer Global Talent Trends Study reported that only 4% of HR professionals believe HR is viewed as a strategic business partner in their organizations.
We believe that’s about to change. The evolving ability to fuse business metrics, HR metrics and analytics to impact organizational performance presents exciting opportunities for HR to cement its place alongside the Finance and Strategy functions as strategic partners to the business.
What does your HRIS and a Hollywood film have in common?
Efficient, innovative methods for capturing, collecting, analyzing and publishing data have been the game-changer; we at Mercer call it HR’s Moneyball moment.
Moneyball is a film based on real events that turned conventional wisdom of choosing baseball players on its head. A struggling team with a low budget only becomes competitive when its Manager teams up with an economist and analyzes statistics to find value in players that no one else can see.
The manager realizes that sometimes details or truths emerge from data that can be overlooked, especially if they come from somewhere – or someone – unexpected. Once recognized, they can lead to uncovering and unlocking potential in business that may otherwise have been allowed to slip away or not approved.
This is one reason that technology, data and analytics should be infused in everything HR does. Patterns and relationships discovered within employee data allow HR to make evidence-based decisions. They enable you to recruit on potential and provide for optimal, flexible rewards strategies based on objective performance of staff.
At Mercer, we’ve gone beyond just having data - to using it better. We can generate correlations and make inferences from your data to provide meaningful outputs that help you to deliver on organizational performance objectives.
The recently released Mercer Dashboard is a key innovation driven by our realization that our own thinking and outlook needed to shift in line with trends and advances in the HR space. The Dashboard provides HR professionals with a visual reference of information and statistics. Our analytics tools have been developed to interpret that data and provide useful insights to your own business and how it compares in the market. You know at a glance how competitive your business is in attracting and retaining the right people.
Technology plays a key part in the demands on HR to evolve from a people management function to an organizational performance function. As the quote goes in Moneyball: “Your goal shouldn't be to buy players, your goal should be to buy wins.”
Rem data analysis over the next 5 years
We’ve come a long way, but there’s more and better to come: watch this space.
We will move away from submission-based data collection in favor of seamless links between your database and ours. Your HRIS will be more user-friendly for more people and any inputs or changes will be reflected immediately, with insights and statistics updated in real time.
Data will come from multiple sources and our analytics will crunch numbers around remuneration, benefits, staffing mix, productivity, staff movements, business & financial metrics, turnover increases, market position – anything that can be measured will be fed into our system. Your HRIS will be more useful, reacting to, and making suggestions based on, your organization’s specific circumstances and requirements. Reports and outcomes will be shaped by your strategic plan
As the technology becomes smarter, faster and more powerful, overlooked patterns will emerge from this integrated data, which will allow users to draw deeper and sharper insights. You will be able to explore the links between apparently unconnected events, and justify decisions and suggestions backed by empirical data.
Insights will be more forward looking as the technology predicts future probabilities of events based on intelligence gained from experience of particular combined circumstances. The system will alert you to an issue before it even emerges.
HR professionals will be able to concentrate on using the outputs to make workplaces more effective, rather than wasting time gathering and submitting historical data.
The key is we will be talking about now and in the future – not what happened in the past.
With better, proactive decision-making, HR will be instrumental in driving the business to reach those strategic objectives, instead of passively aligning with the organization’s strategic plan.
The distinction between HR and business metrics will disappear. In the near future we will see that 4% mentioned at the beginning of this piece edge toward 100% and HR professionals will finally have that seat at the boardroom where they belong.
If you’re interested in discussing your organisations current situation, then please contact us using the form below.