With today’s constantly changing economic outlook, organizations are under constant pressure to adapt and remain competitive. To this end, having a well-informed, agile HR strategy is a key driver of success. Your HR strategy during recession differs from your strategy when the economy rebounds. It’s important to respond quickly to shifting criteria. And so are insights that guide strategic shifts. Yielding optimum results is more challenging when you’re not on solid ground.
Increasing agility within HR
HR teams are increasingly adept at operating outside their comfort zones given the unprecedented events of the past few years. “HR professionals rate themselves progressively as more agile. We believe that this is because the pandemic has shown that HR has the ability to respond to change and adapt”, confirmed Erik van Vulpen and Dieter Veldsman, in their recent The State of Digital HR in 2023: From Business Enabler to Business Driver for the AIHR.
But they warned against any premature backslapping, continuing: “… there is still a lot of room for improvement. The majority of professionals rate themselves below average, and only 36% of respondents (strongly) agree with the statement that the HR professionals at their organization are capable of matching innovative HR solutions to business issues”.
The thing is, you CANNOT achieve different results by doing the same things. HR strategy during recession, or potential recession, requires greater visibility into what’s happening with your people. And the data to help inform what’s happening exists in multiple, disparate systems.
HR Technology
Herein lies one of the key culprits…
While HR has embraced technology to augment and support many day-to-day functions, there are very real challenges, namely:
- Purely transactional or ‘vanity’ nature of available data (reporting vs analytics).
- Overwhelming volume of disparate data sets
Fortunately, most concerns and shortfalls in these areas can be quickly and efficiently addressed with future forward people analytics. How so? Because the ability to leverage people analytics provides previously unavailable insights, for informing and adapting your strategies for maximum impact.
After all, it’s imperative in challenging times (think HR strategy during recession versus rebound!) to understand what’s working, identify issues, and be lean for the greatest return on investment. Analyzing data related to your people and processes helps you do just this.
Let’s take a walk through how and why.
Extracting Metrics
Metrics are essentially measurable data points that can be tracked and analyzed over time to identify patterns and trends. And the first step in leveraging analytics for HR is to extract them, giving you rich insights into employee behavior and performance.
Depending on the lens you want to look through, key HR metrics might include things like:
- Employee turnover rates
- Absenteeism
- Employee engagement
- L&D and training
- Performance reviews
When you’re able to collect, combine and analyze this data, you’re better equipped to understand what’s working well for your organization. Equally importantly, you can also identify areas for improvement. Keep in mind, your HR strategy during recession may differ from your strategy during an economic rebound.
For example, tracking employee turnover rates can shine a light on trends, such as higher rates of turnover in particular departments or roles. And once you know about it, you can investigate the underlying causes, and develop strategies to address any issues you uncover.
Similarly, analyzing absenteeism rates enables you to pinpoint areas of low morale, poor work-life balance, or inadequate job training. Accordingly, once you’re armed with this information you can develop targeted strategies to addresses any problems head-on.
In short, next generation people analytics strategy empower you to not only acquire a bigger picture understanding of the insights your HR data holds. Additionally, it informs both windows of opportunity and any areas of concern.
Identifying Issues
You can really begin to identify issues and challenges to address by extracting relevant metrics. For example, you might discover employee turnover rates are higher than industry averages. Or employee engagement is lower than desired.
Regardless of your business specifics, knowing what is the first step to investigating why.
You might discover employees are leaving because of a lack of opportunities for promotion. Or, engagement levels might be low, because your people don’t feel recognized and / or rewarded for their contributions.
When you know what you’re up against, you’re in a stronger, better-informed position to get proactive. And you know the areas most in need of time and resources, allowing you to prioritize. This could be the implementation of a career development program, or a reward and recognition scheme, to improve employee engagement and reduce turnover.
Whatever it is, one thing’s for sure. If you can’t measure it, you can’t improve it. A frustrating inability to streamline and benchmark HR efforts against goals is a common challenge in the absence of the right tools.
On the other hand, market leading HR analytics means you can delve deeply into your business situation. And understand it in previously envisioned but unavailable ways, especially over time.
Ultimately, tracking successes, and areas where things are falling short of expectations, enables you to:
- Prioritize and focus
- Capitalize on what’s working and improve or adapt what’s not
Crucially, you can also tailor the many and varied functionalities in a formidable analytics toolkit to maximize ROI on your HR investments.
Being Lean for Optimum ROI
With businesses continuing to tread daily on shifting sands, it’s more important than ever to optimize business investments. This includes HR spending.
For this purpose, analytics are game-changing and an important part of your HR strategy during recession AND rebound. Understanding where to allocate resources is critical.
One simple example uses employee training and development. Analyzing your programs yields insights into which are most effective in improving employee performance and engagement. Correspondingly, you now have insights into resource allocation to fund and support the most effective programs.
Similarly, you can identify which recruitment channels are yielding the highest-quality candidates. This ensures HR spending focuses on activities delivering the greatest returns. Which is important to understand for your HR strategy during recession, boom times, and everything in between.
You’re better placed to understand the implications with the ability to dive into the data around your current workforce and clarify influential factors like:
- Where they came from
- Which recruitment channels are most effective
In addition, the effort vs. outcome angle is an interesting one. Holding up a lens to your recruitment process allows you to uncover insights around:
- Resources and upfront effort required to attract quality candidates that stay
- Offer acceptance rates
- Time-to-hire
- Sticking points or obstacles
It’s so powerful to be able to visualize and report on these insights in real time. Be that as it may, it can be challenging to extract value. But the fact is, the cost of NOT doing this can have real business impacts.
In Conclusion
Unifying and making sense of the hidden stories and opportunities in your HR data is valuable. Especially during unstable times when the need to act confidently and decisively is greatest.
At HireRoad, our superior PeopleInsight by HireRoad system empowers HR leaders to be more agile and responsive to shifting circumstances. Informing HR strategy during recession and preparing to pivot ahead of a boom requires insights. Leveraging people analytics to yield insights that address key business issues is an enabling force. One that can be a game changer for your business.
Get in touch for a free demo and take a first look at how PeopleInsight by HireRoad can help steer your business through turbulent periods. Understanding how your people situation supports overall strategic objectives is powerful.