Managing Director, SEI D.C.
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Thanks to digital transformations, people data is more secure and accessible than ever. So why do so many organizations avoid it? Based on my experience, here’s how to use people analytics for good.
For as long as I can remember, the relationship status between organizations and people data has been: “It’s complicated.” People data was traditionally collected using outdated systems, manual processes and paper-based methods, like spreadsheets and file folders, that were anything but efficient. And once the data was finally collected, it was either shoved into a dusty office corner or shared with a select few in light of privacy concerns surrounding personally identifiable information (PII). Simply put, many were scared of two things: showing others what they earned and being sued.
Those select few who were trusted with the data faced an uphill battle as no one was allowed to see the layering of information in between HR data, operational data, product data and customer data. This was largely the result of legal concerns surrounding people data and what could and could not be shared. While justified, these concerns led to frustration among leadership, many of whom thought, “Great, here’s all of this awesome data that can directly impact our bottom line, but we can’t do anything with it.” The result? HR’s seat at the table was once again moved to the second row.
Fortunately, times have changed.
The Transformative Power Of People Data
Advances in HR technology have aligned with data technology developments like data modeling, processing, strategy and governance. These tools can now securely collect, consolidate and retrieve data from multiple sources in real time, masking sensitive people data so it can’t be attributed to one person. That’s a real win for today’s organizations.
Now that we have technology on both sides of the house — the human capital side, which captures all of this information, and the data strategy side, which allows us to process it securely — it’s time for people data to have its seat back at the table. I’d even suggest it take the head of the table.
An astounding 94% of employees would stay at their jobs longer if their company invested in their learning and development. People data helps us do just that as managers. By analyzing our people analytics, we can better understand our teams and identify what it is they want as well as what our organizations need to succeed.
People data also keeps us accountable. In a world where social unrest has become the norm — and often for a good reason — people data helps us not just talk the talk, but walk the walk as it relates to diversity and hiring practices. With people analytics, we can determine just how diverse, or not, our organizations are and adjust accordingly. Putting your company under a microscope in this way can be scary, but it’s crucial. Anyone who says otherwise is just making excuses.
A leader willing to accept their people data, live up to their findings and work toward change will inspire other organizations to do the same and take their business to new heights. When combined with other key business data, people data can directly impact how you run your business on a day-to-day basis, allowing you to improve broken systems, streamline processes, boost your ROI and so much more.
But to get there, we need the data.
The Reasons Why You’re Resisting People Data
People data combined with operational data, customer data and product data has the power to transform organizations, so why do so many continue to sit on the sidelines? I’ve found three reasons for this hesitation:
1. Legal concerns abound. People data often seems too good to be true, leading many execs to wonder: Am I breaking some law here? Is someone going to sue us? This type of thinking is rooted in outdated notions of people data, how it’s collected and, perhaps most pertinently, modern technology’s ability to overcome PII concerns.
2. There’s distrust in the data. Unlike other business metrics (e.g., ROI, gross margin, sales growth, cost of customer acquisition, etc.), people take data on human capital personally. It’s easy for leaders to get defensive or claim that the data is flawed when it casts them in a negative light. They might say, “I’ve been here the whole time, and I know that we have more women in this organization than the data is showing.” Or, “You’re saying I only promote white people, but that’s not true!” Meanwhile, the data is undeniable.
3. For many, privacy prevails. Organizations aren’t the only ones that don’t trust people data. Many employees are reluctant to share personal information, including how they identify, for fear it will hurt their standing within their organization. As a result, many employees choose to not complete all data collection options within their HRIS, which in turn impacts what their organizations can and can’t report on.
The Time To Act Is Now
People analytics is always two steps forward, one step back. But slowly, the tides are changing.
We’re starting to see more and more global companies tap into their people data — legally, consensually and without invading an individual’s privacy — and use it to generate real results. As other companies bear witness to this success, their curiosity is piqued. They don’t want to be the first mover, but they certainly don’t want to be the last.
Shifting generational attitudes are also accelerating the adoption of people data. While their older colleagues continue to hide their identities, Millennials and those who are younger are embracing them. They know that their race, ethnicity, gender, sex, religion, etc. is something to be celebrated in the workplace, not denounced.
So what are you waiting for? You’re sitting on a vault of valuable insights, and you’re holding the key. All you have to do is unlock it.
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