It would seem that talent analytics is a must- have rather than a nice-to-have, at least according to the International Labor Organization’s World of Work Report. The 2022 study revealed a staggering 76% of top employers were already leveraging talent analytics to fine-tune their recruiting and hiring strategies. Fast forward to today, and its significance has only grown. But not all data is created equal.
When it comes to HR metrics, sometimes less is more. While the analytics and data sets behind the scenes should be comprehensive and representative of all HR systems and processes, at the end of the day you need to know which key metrics clearly articulate the impact of your HR team.
This article delves deeper into the talent analytics and the metrics that truly matter, and why they’re pivotal for informed decision-making.
Talent Analytics 101
The key metrics that demonstrate HR impact go far beyond the data that any single HR system can tell you. Historically, that meant that HR teams had to wrangle multiple non-aligned data sets from their ATS, HCM, HRIS, etc. to try and summarize performance and impact in a way that made some sort of sense to their leadership. But ultimately this approach was not only tedious, but couldn’t tell the whole story in a succinct and impactful way.
Now, forward-thinking businesses are taking a holistic approach to talent acquisition and the role it plays in the rest of their HR ecosystem. And the good news is that powerful talent analytics do the heavy lifting, so you don’t have to go cross-eyed with complex spreadsheet formulas.
Take these innovative examples of new era insights:
- Analytics to understand and optimize quality of hire – Understanding the caliber of talent your team is bringing into the organization is crucial, beyond merely filling vacant positions. It allows talent acquisition teams to be more strategic with their recruitment approach, emphasizing the sources that deliver the highest quality candidates and saving wasted resources on those sources that deliver quantity without the quality.
- Time to productivity and performance ratings over time – Both of these metrics equip you with invaluable insights into the effectiveness of the hiring process, post-hire. Imagine being able to analyze the time it takes for new hires to become fully productive, and tracking their performance trajectory over time. And when you understand who your rockstars are and how they came to be on your payroll, you can better optimize future hiring efforts to see continued success.
- Manager Feedback Scores – These are also valuable metrics for assessing not only the quality of your hires, but also comparing back to compensation data, talent mobility, and succession planning. You can glean firsthand insights by getting feedback from managers about the performance and fit of the talent on their teams. It can serve as a transformational way to fine-tune your recruitment processes and hiring criteria on a role-by-role basis.
As you can see, there’s more to talent analytics than just job board data. Many different insights can be brought into play to level up your recruitment efforts. It’s where your people story begins, after all.
Talent Analytics for Supercharged Recruiting
You’re already aware of the difficulties in sourcing and attracting qualified candidates. Additionally, a lack of efficient tools for candidate tracking and management can make the recruitment process extra time-consuming and tedious.
Recruitment isn’t just about filling vacancies, but finding the right talent efficiently and cost-effectively. Enter metrics such as:
- Source of hire
- Cost per hire
- Time to fill openings
Each plays a pivotal role in optimizing the recruiting process, and performance for these metrics vary by role, industry, and location. Think about getting answers to gigantic questions like:
- Where is our top talent sourced from?
- What expenses are we incurring per hire?
- How long is it taking us to fill positions?
When you know the answers, you know whether your current recruiting channels and strategies are as effective as they could be. And then you can optimize different levers to enhance channel performance, recruiter performance and more.
Now let’s fast forward. Say you’ve successfully recruited, hired, and onboarded. You might think your talent strategy (and need for analytics and insights) ends there. But in reality, talent analytics paves the way for ongoing employee development and retention.
Leveraging Talent Analytics for Development & Retention
One of the primary objectives of HR Operations is to retain top talent within the organization. This calls for analysis of the many and varied factors influencing whether employees choose to stay or go, including (but not limited to):
- Employee benefits
- Compensation
- Training programs
- Employee engagement
Each of these factors influence job satisfaction levels, which directly correlates to employee retention. Given the disruption and high costs that come with employee attrition, it is critical to the business for HR teams to prioritize employee retention.
Unfortunately, many HR professionals struggle to pinpoint the datapoints or predictive indicators that ultimately lead to high employee turnover. And when you don’t have a specific metric or underlying cause to focus on, it is 100x more challenging to implement effective strategies to improve retention. And what about the recruitment processes you’ve invested time and effort to master? Your recruitment efforts are diminished if your employees are leaving faster than the time it takes to backfill them, let alone onboard and ramp them up to be effective workers.
This is where key performance metrics take center stage:
- Performance rating distributions
- Promotion rates
- Turnover rate patterns
These metrics gift you with priceless insights into employee engagement, growth opportunities, and retention strategies, so you can:
- Identify and address any trends in staff turnover and proactively combat attrition
- Recognize high-potential employees and design tailored development programs to nurture their talent
The right talent analytics partner will seamlessly integrate your various HR data sources behind the scenes, allowing you to focus on these key metrics that not only demonstrate your impact, but also enable you to track, measure, and optimize performance.
A New Age of Future-Fit Analytics Awaits
Talent analytics is a vast landscape. There’s a lot to take in. So it’s imperative to focus on metrics that truly impact business outcomes. That means not getting distracted by shiny objects just because they’re available!
Instead, a promising supplier will help you drill down into the metrics that you can use to optimize your HR operations team, in support of your broader business goals. So, your shopping list might include priorities like:
- Quality of hire – Refine your talent acquisition strategies effectively by harnessing analytics to uncover sourcing and hiring strengths and weaknesses.
- Funnel analytics – Metrics such as source of hire and time to fill present opportunities to optimize your recruiting approach. As a result, you can spend less time on unnecessary admin and more time on staying ahead of the game with seamless and compelling processes.
- Internal mobility patterns – Get to the bottom of upward, sideways, and downward movements, with analysis of promotion rates and turnover rate patterns. And when you’ve got a clear overview of employee development and career growth opportunities? You’re empowered to move forward with continuous learning and advancement programs within your organization.
Quality Before Quantity
It’s becoming clear that talent analytics are the future of reframing HR and driving organizational success. The secret to success is honing in on key metrics with clear business implications.
So, have a frank conversation with potential service providers about what you need – and what you don’t need. At the end of the day, cracking which talent analytics truly matter to your organization empowers you to:
- Unlock the value of your disparate data sets
- Make smarter decisions that drive performance and innovation
- Understand the quality of hire to optimize recruiting efforts
- Cultivate employee development and retention
Are you next?
At HireRoad, our elite PeopleInsight solution is grounded in meaningful metrics that directly impact business outcomes. In addition, our team of experts can meet your company where they are at in their analytics journey, providing guidance to help define which talent analytics truly matter for your unique needs.
Are you spending too much time crunching numbers from your existing systems, but not seeing any impact? Book a free demo of PeopleInsight by HireRoad and check out the talent analytics that can support your HR operations and your business in just 5 days.