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hr analytics tools

An optimized HR management team is expected to improve business performance, but how can you demonstrate — and continue to demonstrate — that value to your company? One method is to use HR analytics tools.

HR analytics software allows your team to collect data on performance, attendance, workforce expenses, and labor demands in order to forecast future trends and put HR initiatives in place when necessary. Many HR functions, such as talent management, mentoring, onboarding and performance management, can be improved with the right analytics tools in place.

Related articles:

The Ultimate Guide for People Analytics
What is HR Analytics? 5 Ways it Can Boost Your HR Performance and Productivity

Why do Businesses Need HR Analytical Tools?

The main two key reasons why organizations require HR analytics tools are:

  1. They make analytics more accessible to HR and business stakeholders, which helps in better HR decision-making.

  2. They automate frequently requested metrics and reports, allowing HR professionals to focus on more pertinent projects and respond to crucial and strategic talent issues more quickly, based on the information gathered from the software.

Most organizations rely significantly on their employees to provide value to their consumers. Using analytics to measure the organizational performance can guide business professionals to improve this performance. By understanding the impact of their current practices on their business performance, the firm will be able to produce more value for consumers, boost profits, and be successful if the appropriate people are in the right positions.

HR analytics solutions aid in the translation of people data such as demographics, skills, salary, and productivity into actionable insights that aid business choices regarding the workforce. HR analytics tools can also extract insights from unstructured data, such as employee feedback and experiences, and use predictive analytics to help with HR decisions.

5 Ways to Use HR Analytics Tools

  1. Workforce analytics: Analyzing employee behaviors, their patterns and trends and relevant KPIs related to headcount, turnover, tenure, etc. helps organizations drive the company forward. Essentially, this is a way to measure and improve employee and organizational performance.

  2. Forecasting employee turnover: Analytics tools should assist your HR staff in tracking voluntary turnover rates to better prepare the firm for future exits. This can be done by using critical factors such as tenure, compensation level, job performance or even commute time to predict whether employees will leave the company.

  3. Talent management analytics: Recruitment data from an applicant tracking system (ATS) can be used to measure metrics such as cost of hiring, time to fill and time to hire. HR can also use ATS data to determine the channels that provide strong prospects and successful hiring rates using recruitment data. By combining recruitment data with other data sources such as engagement surveys, onboarding feedback and turnover rates, you can take talent management to the next level.

  4. Actionable insights: Based on the data collected and stored in a HR analytics solution, you should be able to provide actionable insights to your team. In other words, you should easily be able to draw conclusions and directly implement a course of action to drive business results.

  5. Reporting: Basic reporting such as payroll reports, employee rosters, employee headcount reports, etc. can be easily extracted from a reporting tool as long as you have all the necessary data items available in the system. Reporting can also include data visualizations such as charts and graphs to show historical trends or to compare KPIs.

Data Security and Access Issues

With even more of our private information being kept in the cloud, HR data security is more important than ever. Businesses must be able to persuade employees that their data — such as social security numbers, financial information, home addresses, and so on – is safe.

One of the primary concerns for HR directors when it comes to HR analytics is data security. Conventional methods of people analytics frequently entail extracting confidential employee data from HR systems and analyzing it in spreadsheets or data visualization tools. However, this technique exposes the data to security threats, particularly if it is e-mailed throughout the organization in an unprotected format. 

Today, companies must be more cautious about who is permitted to develop, access, and distribute reports including personal information. HR’s awareness of such issues has also been raised by data-privacy rules like as the EU’s General Data Protection Regulation (GDPR), which has introduced regulations to avoid the dangers associated with data analytics.

One solution is to leverage platforms that allow HR users to integrate their external data into the company’s system and use it as a data hub for HR analytics tools, rather of pulling it out and exposing it to security threats. The data is encrypted and only those people and teams who are permitted to access it have access to it.

Many HR systems also allow you to regulate the display and modify visibility of data to reduce the danger of data exposure. HR systems also allows businesses to specify which individuals’ data should be erased when, which is one of the GDPR’s fundamental criteria.

What to Look for in an HR Analytic Tools

All HR analytics software come with a variety of bells and whistles to try to enhance HR analytics. However, the first consideration for an HR manager should be how effectively the software interfaces with their existing HR programs.

To choose the best HR analytics tools for your organization, the team may make a list of the most pressing HR issues and desired business goals. Then consider if the business intelligence tools can assist in meeting those needs. Try asking your self the following questions when it comes to choosing an analytics tool:

  • Can the tool handle large datasets?

  • Will the tool be used by HR or data scientists?

  • Is the tool scalable in terms of data sources you can add over time?

  • Is the tool able to display data in real-time dashboards?

To do an in-depth analysis of HR data and create predictions, data analysis software such as Phyton or R could be used. They provide the capacity to do the most complex analysis while dealing with massive amounts of data. However, these tools require a skilled data analyst or data scientist in order to process the data and run queries.

To acquire key insights into the company performance and employee data, no-code analytics tools can be used. These tools allow HR professionals (no matter how tech-savvy) to do ad-hoc analyses, run reports, and build employee dashboards to visualize key HR metrics and drill down on the data that matters.


Human resource directors have faced substantial challenges in using analytic tools to make better people choices for years. To assess metrics on employee satisfaction, cost per hire, attrition rates in critical roles, and gender pay equity, they’ve sometimes been forced to piece together data from different spreadsheets or seek to obtain information from complex systems.

While such technological barriers still remain in many organizations, they’re fast becoming a thing of the past as more comprehensive, cloud-based analytics tools enable HR to use people data in more early and efficient ways to assist organizational decision making.

PeopleSpheres responds to these barriers by:

  • Providing a universal interface for all your HR tools for easy data management

  • Keeping data safe by following GDPR regulations and centralizing data into a data hub

  • Enabling HR professionals to manage data with an intuitive no-code tool

Book a demo today and we can show you how it works!

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