Since 2014, McKinsey have released a series of reports that explore the importance of diversity and inclusivity in the workplace. In their latest report, “Diversity Wins”, they found that the top-quartile of companies who have a diverse and inclusive workforce outperformed those in the fourth quartile by 36 percent in profitability.
Continue reading to discover why diversity within businesses, paired with data analysis, is a winning combination to achieve better performance within your organisation.
Human resources (HR) data analytics is the practice of using data to understand and improve HR processes, programmes, and outcomes. HR analytics can help organisations make data-driven decisions, measure the effectiveness of HR initiatives, and improve employee performance and engagement.
HR analytics, or sometimes known as people analytics, involves collecting, analysing, and interpreting data related to human resources. Data can come from a variety of sources, such as HR information systems, performance evaluations, employee surveys, and exit interviews.
HR data analytics can help organisations identify areas of improvement and opportunities for growth. For example, you might use analytics to identify skills gaps in the workforce, and determine the best ways to close those gaps through training and development initiatives. HR analytics can also help organisations improve retention by uncovering the factors that contribute to employee turnover.
And HR analytics can help organisations make more informed decisions about recruitment and talent management. By analysing data on recruitment sources and methods, organisations can determine which sources are most effective at attracting top talent. Analytics can even help organisations identify high-potential employees and develop succession plans to ensure continuity in key roles.
Promoting diversity in the workplace is simply the right thing to do. In a world that is increasingly diverse and interconnected, it is important for organisations to create environments that are inclusive and welcoming to all employees. By promoting diversity in the workplace, organisations are taking a stand against discrimination and creating environments that are respectful to all.
Apart from the moral argument for it, diversity in the workplace has many benefits to an organisation and its employees:
Using HR data analytics to promote diversity in the workplace offers numerous benefits to organisations, such as:
Data analysis can help HR professionals to analyse candidates' resumes and job applications to identify the best fit for the job. It can help in shortlisting candidates more efficiently based on their skills, qualifications, experience, and other relevant factors. Using data analysis can also automate this process and save time, as opposed to a slower, more traditional, manual process.
Predictive analytics can also help HR professionals forecast future hiring needs, identify potential candidates, and analyse their fit for the organisation. It can identify factors that lead to employee turnover, allowing organisations to take proactive measures to limit the effects of turnover.
HR data analysis can play a critical role in identifying bias in hiring, promotions, and performance evaluations. By analysing quantitative data on factors, such as demographic representation, performance metrics, and candidate selection criteria, HR professionals can identify patterns and trends that may indicate the presence of bias.
For instance, if employees from certain groups consistently receive lower performance ratings than others, this may suggest a bias is present in the decision-making process. By identifying these patterns, HR professionals can take steps to address bias. They can then ensure that their hiring, promotions, and performance evaluation processes are fair for all employees. This may involve implementing changes like removing identifying information from resumes or providing unconscious bias training for decision-makers.
HR data analytics can help organisations identify factors that contribute to job satisfaction and employee turnover. This information can be used to develop initiatives to improve retention and promote a more inclusive workplace culture.
HR professionals with data-driven insights can provide decision makers with the concrete evidence they need to be able to make more informed HR decisions. This can also be an effective way to communicate with stakeholders and other departments when proposing new initiatives. Data analysis can provide the supporting evidence needed to have new initiatives approved.
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There are several key metrics that organisations can track to assess the effectiveness of their diversity and inclusion efforts. Here are some of the most important metrics:
Below are some common challenges HR departments may face when using data and best practices to overcome these challenges:
Using data analytics in HR is pivotal to getting a better understanding of your team. However, there are ways to use data analytics within HR to make the most of your data and its capabilities.
Here are some best practices of using data analytics in HR:
Establishing clear goals in HR data analysis is crucial for several reasons. Firstly, it ensures focused and meaningful insights. Clear goals enable HR professionals to extract relevant information and make informed decisions.
Secondly, it helps align HR strategies with organisational objectives. By setting specific goals, HR data analysis becomes a powerful tool for driving performance and achieving desired outcomes. Clear goals facilitate effective communication and collaboration within HR teams. They provide a shared understanding of what needs to be accomplished and promote cohesive efforts.
Including diverse perspectives in the data analysis process brings unique interpretations of the data, uncovering patterns and trends that might otherwise go unnoticed. This enriches the analysis and leads to more comprehensive and accurate findings.
Secondly, diverse perspectives help mitigate biases that can inadvertently influence data analysis. By including individuals from different backgrounds, experiences, and viewpoints, organisations can challenge assumptions and ensure a more objective analysis. Incorporating diverse perspectives also fosters a sense of inclusivity and belonging amongst employees, leading to increased engagement and retention.
Societal norms and understanding of diversity and inclusion are constantly evolving. By regularly reviewing initiatives, organisations can ensure that their practices remain relevant, aligned with current best practices, and responsive to emerging issues and challenges. Secondly, employee demographics and needs change over time. Conducting regular assessments helps organisations identify emerging trends, allowing them to tailor their initiatives to meet the evolving needs of their workforce.
In their 2023 Diversity Report Google said: “Informed by rigorous analysis, we built our most representative workforce yet.”
Thanks to comprehensive data analysis, Google “doubled down” on initiatives that were proving successful in increasing diversity within their workforce. In 2022, they met their Racial Equity Commitment of increasing leadership representation of Black+, Latinx+, and Native American+ Googlers by 30%.
Google developed a number of initiatives that have enabled them to diversify their workforce. For instance, in 2021 they trialled “The Collective” , an onboarding process specifically designed to support black employees and their managers. The initiative was launched across 8 countries with 93% of people taking part saying it was worth their time, giving them deeper connections in the workplace.
Onboarding processes are a crucial part of the hiring process to retain new employees. And data analysis allows companies to identify areas of hiring processes that can be improved to promote diversity and inclusion within their teams.
At Cambridge Spark, we upskill your team to harness the power of your data through government- funded apprenticeships. In fact, you can enrol yourself or your team in an HR-specific programme developed with a People Analytics Pathway, with content from the Chartered Institute of Personnel and Development (CIPD). Delve into the data surrounding your workforce and learn data analysis skills that allow you to enhance your organisation’s diversity in the workplace.
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