The relevance of HR analytics is threatened if human resources professionals rely on bad data to make strategic decisions.
People analytics is a new concept in the world of HR. You may need to familiarise yourself with how to read and interpret data – mostly how to sort the good from the bad.
The emerging status of people analytics means there is potential for you to focus on the wrong data values. Using bad data leads to poor strategic decisions, undermining the use of analytics before it can be established.
Bad data is a real threat while you learn to read people analytics. Here are three things you need to know about bad HR data.
Outdated data will skew today’s data.
Dirty data gathers as HR changes systems. These changes come from payroll systems, talent management, or any other HR function using technology. Bad data gets left over from old systems, slowing down new systems and altering KPI targets.
Metrics such as KPIs and targets use data to predict future performance. An HR system full of bad data will produce inaccurate targets that do not reflect a team’s skill.
You need to check what data to cleanse when changing systems. Rooting out the cause of bad data, be it data input or the source itself, makes it easier to decide what data to keep.
Monitoring data over time to assess it’s relevance prevents bad data build-up and keeps your HR systems accurate.
The use of analytics should be more about insights and less about raw data.
A recent report by KPMG looks at the use of people analytics in HR systems. This report found data is only as good as the questions being asked of it.
Bad data can be the result of bad questioning, looking at fragmented data or looking at too narrow a data set. HR professionals have never been relied upon to use data up until very recently. A data orientated mindset is required to gain purposeful insights from people analytics in HR system.
The solution to bad data offered by KPMG is future focused analytics, known as workforce planning. You can do this by knowing what you want to improve before using data. Data search must then be broadened to include all aspects of the target issue. HR professionals then have data relevant to an issue they aim to resolve, rather than mountains of potentially useful data to sift through.
Having a targeted focus allows HR to identify bad data. Data that is too old, insufficient or irrelevant to the current issue can be removed from the system.
Ultimately, you can only make decisions with people analytics data once the use of the data has been identified.
Data can be subject to biases and poor definitions.
Relying on information from performance appraisals is a source of bad data. We assume people conducting performance reviews are able to make objective assessments on employees’ performance.
Academic research has proved performance appraisals say more about the reviewer than the subject. The current system does not factor in an individual’s biases when measuring others.
One manager’s definition of compliance can differ from another’s. This differing of understanding will yield different results during assessment. Performance appraisals become an assessment of the manager rather than the employee.
The use of wording in performance appraisals can also create bad data. A 5 out of 5 rating can defined by ‘constant compliance’ and a 4 out of 5 by ‘frequent compliance.’ This slight change in wording separates 100% and 80%. The difference between these two words is debatable, and what constitutes ‘constant’ over ‘frequent’ is subjective.
You’ll need to recognise that one of your largest sources of people analytics is not conclusive. Factor this subjectivity bias into your decision-making process.
People generated data isn’t necessarily bad data, but you’ll want to acknowledge its limitations and place weighting accordingly.
Effective HR analytics must be relevant, forward-looking and defined to create value.
Bad data can be as damaging to HR professionals as working with no data at all. Poorly established HR systems are full of bad data that reduces HR’s ability to make strategic decisions.
Consider what you’re looking for before consulting people analytics. Complete systems of relevant data must be in place for you to have relevant data to draw from.
Approaching data with a forward-thinking mindset is a major change needed for people analytics to be useful. The required relevant data can be measured once your end goal has been established.
If you keep these three points in mind, you’ll be able to prevent the build-up of bad data, and keep people analytics in HR systems functional and productive.
Contact Navigo today to talk about how best to measure and track your people analytics and workforce data.