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People analytics - the key to the future of HR

Numbers almost never lie. In the movie, Moneyball, Billy Beane, the general manager of Oakland Athletics, made a memorable remark to Grady Fuson, his head scout. He said, “You don’t have a crystal ball, you can’t look at a kid and predict his future, anymore than I can”. Moneyball tells a story about how the Oakland Athletics overcame the odds in 2002 thanks to Beane’s methods of prospect selection based on mathematical and statistical analysis.

The fourth industrial revolution has introduced new challenges and technology to businesses and organizations worldwide such as easy access of data, the rise of AI, and monumental changes in the social fabric. Thanks to digital innovations and constant connectivity, a major domain that has been disrupted as part of the fourth industrial revolution is the workplace. Here, we see team dispersion and remote working, sensitivity to work-life balance, and a strong desire for purpose, are now driving organizations to refresh their work culture and reinvent themselves.

The function of the HR has become very challenging because attracting new talents, and retaining them is now a mammoth task and a top priority for all companies. In order to decrease employee attrition, companies invest a lot of effort to provide the best employee experience including continuous learning, making work meaningful, and giving people a sense of belonging and trust.

According to MIT research, enterprises that are rated in the top 25% with the best employee experience have 25% higher profits, and achieve twice the innovation and double the customer satisfaction compared to organizations that are in the bottom 25% of that list.

Like in other fields, in order to improve, we need to enroll the power of data, analytics and AI for highlighting opportunity zones, improving them and build a better work environment. One of the recent most innovative fields in the world of HR is people analytics.

People Analytics refers to the method of analytics that can help managers and executives make decisions about their employees or workforce, using statistics, technology and expertise. We see the use of people analytics in employee churn prediction, measuring employee engagement and work effectiveness and driving innovation.

According to research by Bersin by Deloitte, Sierra-Cedar and Visier, companies with advanced capability in people analytics have optimistic numbers: 30% higher stock prices, 79% higher return on equity, and 56% higher profit margins.

Let us look at how executives choose to implement people analytics in their company.

Dawn Klinghoffer, Head of People Analytics at Microsoft, leads an approach of doing the ‘right’ thing to do for workers. She believes that a transparent process adds value to the employees and with a clear purpose and intended action to help employees focus on the work they are doing.

Microsoft used People Analytics to improve the employee experience. The Microsoft team discovered that managers that send more emails to employees, or emails from anyone in the organization outside of normal business hours impact the employee’s perception of their work-life balance.

The outcome resulted in a new feature added to Microsoft's Outlook. This feature prompts employees to confirm if he or she is indeed sure about sending any late-night email and thus potentially reduces the negative impact an after-hours email might have on an employee..

Another leader in the field of people analytics is SAP. According to Jennifer Morgan, president of SAP North America, “The future will be won by those that understand the value and impact of diversity on your business and bottom line.”

Studies have shown that highly inclusive organizations generate 2.3 times more cash flow per employee, 1.4 times more revenue, and rate themselves 170% better at innovation. SAP leveraged advanced analytics capabilities to measure, monitor, and drive activities to ensure accountability and accelerate excitement around current D&I initiatives.

Creating an inclusive work environment is a high priority challenge. At Cassiopeia, we are trying to harness AI and People Analytics to help organizations to create a healthier and more inclusive work culture while increasing employee retention by detecting offensive behaviors.

Back to Moneyball, and Billy Beane eventually became famous for using statistical analysis and helping the Oakland Athletics to set a record-setting winning streak. Beane set a precedent for teams with small budgets. In a similar vein, People Analytics is set to be a game-changer and will help create profound shifts for big and small organizations, from detecting low levels of effectiveness to better value creation. Early adopters that embed People Analytics as part of their strategy to drive performance know they have nothing to lose.

Tal Ben Basat is the CTO of Cassiopeia, a startup that fosters a healthier workplace by measuring, predicting and preventing offensive behavior. Tal has more than 12 years of experience in senior management positions as former VP of R&D and team leader in leading startups and in the IDF elite technological unit. Tal has lead developers, algorithmic engineers and data scientists for many complex and challenging products in ad tech, finance, communication and video.

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