I love how Google Maps predicts which route will get me to my destination quickest. What if we could do the same for HR when it comes to predicting employee retention? The good news is we already can. Here’s why you need predictive analytics tools for HR.
What is Predictive analytics?
Analytics are like gold-dust for HR professionals. A study from Nucleus Research shows the return for investing in analytics is $13.01 for every dollar invested. Predictive analytics can help you forecast what’s likely to happen in the future.
Predictive analytics HR tools use historical patterns, machine learning and artificial intelligence to give you the information you need to predict. Using this data can help you better plan your operations and make positive changes in your organisation.
If you know how many exiting employees you’re likely to have, you can plan resources more effectively. You can also predict the times of year when employees are likely to start looking for new roles. This can help you reduce or mitigate risk, reduce recruiting costs and increase revenue.
1. Start with Descriptive Analytics
Before you dive straight into predictive analytics, start with descriptive analytics. Think of descriptive analytics like a pedometer that tells you how many steps you took.
When thinking about retention, you can extract descriptive analytics from your exit survey data. This includes data points like the number of leavers you’ve had in a month, what departments they were from, and your overall percentage attrition rate.
Now that you’ve collected this data, what you do with the information is the next step.
2. Predictive Analytics Tools: Your HR Crystal Ball
HR technologist Josh Bersin asserts that the datafication of HR is important for the future of the function. According to Deloitte, organisations spend over $14bn in HR software, yet ‘fewer than 4% can perform predictive analysis on their people and only 14% perform statistical analysis at all.’
If you decide to invest in predictive analytics HR tools, you’ll gain a competitive advantage over other companies who aren’t even thinking about analytics yet.
If you invest in predicting employee turnover, you’ll be able to get a risk profile for each department to understand if your top talent is going to leave.
You’ll also be able to pull out the key factors that are contributing to exiting employees and make positive changes to your organisation. This will help you learn how to increase employee retention.
Using demographic filters will allow you to identify groups that need your help and you will be able to solve your employees’ issues at scale.
3. Beware the Silo Effect
If you decide to use predictive analytics for HR, get all your data into one place! A lot of companies suffer from the silo effect which will send you in misleading directions.
Once you have all your data in one place, you will have the full picture and will be able to make a fully informed decision based off the best data you have.
If you don’t have any data, start now! A simple employee survey at onboarding, exit, or every 6 months in your organisation will be a great way to start your Predictive Analytics journey.
Make sure you take action and communicate any changes that are made back to your employees. The most important thing is to take that first step. For those that are still conducting face to face exit interviews, create a spreadsheet and start recording those answers.
4. Make the Business Case for Predictive Analytics
Not sure how to sell predictive analytics to your leadership team? Establishing a Return on Investment can make it a lot easier to get leadership buy in for new initiatives.
When it comes to any new initiative related to employee turnover, use our employee turnover cost calculator to help you and your leadership team understand how much you can save for your business.
Data is the best way you’re going to be able to bring real insights to the table at your organisation. First, start by identifying your top business challenge – is it high turnover? Bad brand awareness? Low Glassdoor scores? Time and cost to hire?
Next, start researching the Predictive Analytics HR tools that will help you make positive changes.
Talivest’s Predictive Analytics solution
Talivest can help you get started on your predictive analytics journey through our real-time feedback and survey tools. If you’re interested in seeing it in action, give our 14-day free trial a go today.