How to Analyze Data That Measures HR Impact: Free HR Report Checklist
Nearly 70% of executives agree that measuring the impact of HR initiatives is very or extremely important. So how are you tracking, analyzing, and presenting your HR data?
Human resources departments are sitting on a gold mine of data—turnover rates, employee performance reviews, benefit usage, pay history, and more. But too often, internal people data gets overlooked in favor of customer data—even though overhead is your company's biggest expense.
Taking advantage of your data is the difference between being a paper pusher and being a powerhouse people advocate. Keep reading to learn how to tap into your org’s hidden HR data, how to measure HR impact, and how to package that data into an insightful narrative.
How to analyze your data to measure HR impact
If you’re just getting started measuring your HR impact, it can seem daunting.
Here’s the good news—you’re likely already collecting much of the data and tracking the HR metrics you need to uncover insights into what’s working well and where you can improve.
Step 1: Audit your employee data
The first step is digging into employee data you already have.
Employee data (e.g., employee records or personnel files) is the most basic building block needed for people analytics. And luckily, it’s information businesses already collect for payroll and legal compliance.
Step 2: Analyze business data
To truly get a complete picture that ties everything together, HR needs to pair people data with business data. This is what brings compelling people insights to the surface, including HR’s impact on the business—which is what executives really want.
Step 3: Identify key narratives
As you generate reports, whether manually or through an HR platform, look for patterns and trends.
Your people data will reveal insights about the human story behind the numbers. From there, it'll become easier to prioritize strategies that address opportunities for improvement.
For example, if high-potential employees consistently rate your onboarding program as ineffective in their new hire surveys or they tend to leave within the first six months, it's time to reexamine your onboarding process.
Step 4: Launch HR reports and strategies
Data analysis is more valuable when it's shared. To truly succeed, you'll need to master the art of communicating your findings to internal stakeholders through insightful HR reports.
For example, Gallup found that companies with highly engaged employees outperform their competitors. How does that play out in your organization? When you can clearly make the connection between employee satisfaction and increased employee productivity and business profits at your own company, there’s no better proof of HR impact.
9 tips for showcasing HR impact to executives
You’ve got a pile of data gathered in front of you. What now? It’s time to start analyzing. Here’s how you can become a powerful data storyteller:
- Align with your company mission. HR goals and business goals should be the same. Metrics aren’t insightful without goals. Get leadership buy-in by aligning with goals set for the business.
- Draw clear comparisons. Make sure your baseline data and data representing changes over time are clearly labeled.
- Identify opportunities. The true power of people analytics is in pointing out overlooked opportunities. Even if the numbers aren’t great, it’s imperative to lean in and present a plan to address the issues they reveal.
- Tell the full story. Having reports is just the starting point. You need to have context to explain the influencing factors and focus on what is most important to who you’re presenting to.
- Focus on SCIPAB— Situation, Complication, Implication, Position, Action, and Benefit. This framework covers the most essential information for internal comms. It's a great way to outline what data points mean, what happens if trends continue, how you recommend proceeding, and the outcomes you anticipate.
- Show financial impact. Show what attrition is costing the business, not just if it’s up or down. Show labor costs as a percentage of revenue or operating expenses. Cater the story to the numbers.
- Know industry standards. Come prepared to answer questions about how your numbers compare to industry averages.
- Cut your talking points in half. Force yourself to focus on the most important bullet points. Too much data is overwhelming. Stay out of the weeds!
- Pivot based on feedback. Know your data back and forth, so you can be flexible in responding to executive needs and implement their feedback.
The most effective and error-free way to report on your data is with an HRIS with built-in reporting tools. In fact, an HRIS is so effective at aiding in reporting and people analytics that at least 47% of HR professionals use HRIS reporting to measure HR’s impact.