Data Analysis and its Impact on Chief People Officers

Data analysis is changing the way businesses operate across all industries. By leveraging data-driven insights, companies can make informed decisions that support growth and improve efficiency. One key area where data analysis is having a significant impact is in the field of human resources.

Chief People Officers (CPOs) are the drivers who forster the business growth with margin enhancements and capital relocation while prioritising the employee experience. Decoding data and people analytics has become as a significant competency for people-management officers.

According to a recent study by The Adecco Group and the University of Zurich’s Center for Leadership in the Future of Work, 90% of respondents said that understanding data and people analytics is an important skill over the next five years. The importance of data to the recruiting function is also growing. In a different study, 73% talent leaders from different organisation said that data would be crucial get a competitive edge as the changing landscape due to the pandemic continues to extend.

So why is understanding data and people analytics so important for CPOs? The answer lies in the ability to make informed decisions based on data-driven insights. By analysing data on employee performance, engagement, and retention, CPOs can identify areas for improvement and implement targeted interventions to address any issues.

For example, if data analysis reveals that employee engagement is low in a particular department, CPOs can investigate the underlying causes and implement targeted interventions to address the issue. This could include initiatives such as training programs, team-building activities, or changes to management practices.

Data can also help CPOs optimise their talent acquisition strategies. By analysing data on candidate behaviour and preferences, CPOs can tailor their recruiting efforts to attract top talent more effectively. This can help companies gain a competitive edge in the war for talent.

But leveraging data analytics requires more than just collecting data. It requires the ability to analyse and interpret the data to make informed decisions. CPOs must be able to use data analytics tools to analyse procurement data and identify opportunities for cost savings, mitigate risks, and improve decision-making processes. 

However, CPOs face several challenges in using data analysis effectively. In a new McKinsey survey, 86% of people officers reported that they don’t have the solutions to get quality internal and external data. Additionally, capacity constraints and low penetration of analytical skills in procurement teams limit the amount of data that can be processed with traditional tools.

Inaccurate data is another major challenge in data analysis. Manual data entry is prone to errors, which can distort reports and influence bad decisions, said Pathstream. Manual system updates also threaten errors if changes are not made consistently across all systems.

In addition to their strategic role in managing human resources, CPOs are also responsible for developing a well-defined company culture. They ensure that the company values are reinforced with every initiative and communication. This helps to create a positive work environment where employees feel valued and engaged, leading to increased productivity and retention.

For example, if data analysis reveals that employees value flexible working arrangements, CPOs can work with management to implement policies that support this preference. This could include initiatives such as remote working options or flexible schedules.

In summary, understanding data and people analytics is becoming an increasingly important competency for CPOs. By leveraging data-driven insights, CPOs can make informed decisions that support business growth and employee well-being. However, they must also overcome challenges such as accessing good quality data and developing analytical skills within their teams.

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