HR data and analytics are in short supply

One of the many frustrations we continue to hear from HR leaders all over the world, is their lack of access to quality data.  This prevents them from making fully informed plans and decisions, and prevents them from providing business leaders and/or sceptical stakeholders with the accuracy of reports and analysis and performance metrics so commonly utilised by other functional units. This lack of data can be attributed to various things inclusive of:

1. HR functions collecting the wrong kinds of data for years and/or haven’t been keeping it refreshed and current - also known as “junk in, junk out”

2. HR leaders don’t know how to interpret the data they have - numeracy has not been a traditional requirement in the competencies demanded across all functional areas of HR (excepting the professionals within the compensation and/or benefits fields)

3. HR systems don’t have the functionality to “slice and dice” data to the extent that is required for thorough analytics - especially in the case where systems are actually extracting data from other functions where the data collected wasn’t originally designed for the purposes of HR reporting eg: sales team achievements / finance reports

4. HR teams don’t have the expertise to custom their systems to receive the data they collect; and are reluctant to admit their need for help from their IT colleagues

5. HR teams don’t have the processing expertise to ask the right questions of employees and leaders, to receive the data they actually need to create business useful analytics

6. HR systems are purchased, that turn out to not actually be able to do everything the HR function (and business requires) and HR leaders are reluctant to ‘fess up on the financial mistake so wind up “making do” with the current investment - the purchase having been effected despite any of the knowledge and skill gaps referenced in the points above!

Which HR system is best?

HR leaders are often not aware that different systems offer varying functionality and with jargon like HRIS, HCM and HRMS it is understandably confusing. It doesn’t help that industry experts haven’t yet agreed on a global definition standard to define a HR system, and system vendors don’t always clearly define their solution into a system category either. There are also a growing number of cloud based software-as-a-service (SaaS) HR systems which offer their own pros and cons. Some HR technologies, especially HCM (human capital management) and HRMS (human resource management system) tend to be more feature-rich, with options for accommodating onboarding, salary planning, performance management, time and task tracking, and performance management. Some HR systems even offer workflow automation and social network integrations.With absolutely NO vested interest in SelectHub, we do like their graphic which is a simple guide to the different HR technology systems available today:

Workday is one of many HR systems available globally

With absolutely NO vested interest, we've observed the phenomenal rise of the Workday solution, and we're keen to know why their users are such fans.

Just like an "overnight" pop sensation, Workday to many appear to have come from "out of the blue" (they were actually established in 2005)  but it is markedly noticeable how many of our multinational clients continue to move their human resource information and management systems (or Excel spreadsheets) to this solution.

Even more noticeable is how Workday users rave about the product.  In contrast, we've been hearing HR leaders for years bemoaning the complexity of SAP or the shortcomings of Oracle and PeopleSoft and the like.

Maybe the success of Workday is that they launched first as a Human Capital Management (HCM) system, and added other functional specialisms afterwards - as opposed to being a financial or procurement system with HR as an after-thought bolt on?

Maybe, because Workday have created their software from the ground up and relatively recently, they have been able to take advantage of having new technologies core to their offering (mobile applications, analytics, memory software and other such techie things); rather than being old technology that has to be revamped and effectively renovated?

Maybe with Workday being a private company, founded by the ex PeopleSoft founder and CEO (and billionaire) David Duffield, they can concentrate on getting the software and service right, rather than kow-towing to shareholders or stakeholders who don't have such a strong HR software background.

We are also told that migrating to Workday is relatively fast and painless compared to other HCM's (obviously this isn't taking into account the data audit and cleanse that invariably leads up to this). The financial investment required, is certainly hefty, which inhibits many smaller companies from taking the plunge, but arguably that applies to many of the HRIS solutions being touted on the open market today.

Certainly Workday have gone past the stage of being a “one hit wonder” and its looking less likely that they’re a “build to be acquired” proposition. So long as they continue to invest and develop their product, and keep it effective with new technologies, its likely to be around as a competitive HCM for years to come.

HR systems are an investment of time and money - is your HR technology strategy for the long term?

If you’re contemplating this type of purchase, it will pay for you to understand the type of system you actually need. Any online search for HR technology software will show thousands of results for different software products offering enticing tools and functionalities. Which solution is best for your business will depend on a host of factors, including size and type of headcount, industry, payroll needs, where workers are based, and of course budget. Key features you’ll likely want to consider include:

1. Accessibility

   Having a cloud-based software-as-a-service (SaaS) HR system proved particularly useful for many companies operating through the work from home demands of the Covid19 pandemic. It can also be beneficial for leadership access when travelling, or for employees who don’t have regular access to offices or laptops. Check what time zones are offered by the vendor for technical and user support, what usual response times are, and what if any restrictions on number/duration of support requests apply.

2. Recruiting and applicant tracking

   Any HR system with a built-in applicant tracking system (ATS), or that allows your current ATS to be “bolted on” can help standardise and automate the time consuming process of posting job applications to multiple job-search sites. Some systems also store candidate applications and all of the evaluation notes for candidates eg: test results, interviewer comments, references. Be sure to check what compliance settings can be enabled to accommodate international legislations eg: the GDPR for Europe

3. Reporting

   You’ll likely need a HR system that is able to generate reports from key workforce metrics such as compensation history, turnover, training history, and performance data. Ensure your reports can be customised for different formatting or filtering options and that there is an option to export reports in popular formats such as Word and Excel.

4. Training and development

   Some HR systems can schedule, deliver and record each employee’s progress through the company’s training or compliance programs; and issue issue alerts if required training is not completed. If training materials are stored on the system, check whether reminders can be auto-issued when updates are needed, and whether you can easily add in new modules of training material as well.

5. Employee interface

   Basically a ‘self-service’ option that allow staff to update personal information, download payslips, populate timesheets, apply for leave and more without having to fill in forms or add to the workload of the HR team.

Regardless of whether your HR function chooses to remain paper oriented, to continue using Excel spreadsheets, or to invest in a HR system - leaders within companies of all shapes and sizes are increasingly demanding data from their HR executives, in order to make more informed decisions for continuous improvement and alignment. Whether it is used for understanding current workforce trends, resolving challenges with recruitment, pinpointing recurring disputes, finding ways to retain high-value employees, or simply making strategic decisions when assigning roles and responsibilities - being able to provide meaningful data is seen as one of the key pillars for HR teams to enable their companies to remain competitive, financially successful, and sustainably viable in our constantly changing world.