What is the Optimum People Analytics Team Size?
The Insight222 People Analytics Trends research for 2022 found that people analytics as a discipline has grown in importance and that the accelerated growth of and investment in people analytics was not a “flash in the plan”.
A question that people analytics leaders frequently ask is, “what size should my team be?” Insight222 introduced a new method for understanding the optimal people analytics team size. This is the ratio for people analytics, which compares the number of people in the people analytics team with the total employee headcount of the company.
The Ratio for People Analytics Explained
Our approach to understanding the optimum people analytics team size compares the people analytics team with the total employee headcount. This is more appropriate than a comparison of the size of the people analytics team with the size of the HR function, which
is often assumed to be the most logical approach. This is because it prioritises the guiding purpose of the people analytics function: delivering business value (not just HR value).
Successful people analytics teams remain focused on the needs of the business. In other words, when prioritising people analytics projects, the team concentrates on work that will drive significant business value instead of carrying out work for the benefit of the
HR function alone. People analytics teams must think “business first”, adopting an outside-in view and working for the business, not just HR.
Therefore, the size of the people analytics function should be considered against the total employee headcount of the entire business.
People Analytics Was Not a “Flash in the Pan”
Across the 184 companies surveyed in our research, we discovered substantial growth in team size from 1:4000 in 2020 to 1:2900 in 2021, which has been maintained in 2022. These ratios are the median of the companies surveyed each year. This means that in a company of 100,000 employees, the people analytics team size is, on average, 34 in 2022 and 2021, compared with 25 in 2020.
After the First Year, Investment Increases
Our research also allowed the examination of the ratio alongside the tenure of the people analytics function – in other words, “how old is the people analytics function itself?” We found that companies with a people analytics function in place for less than a year have a ratio of 1:4800, compared with 1:2700 for companies with a people analytics team that has been established for two or more years. This demonstrates that a company’s investment in people analytics skills increases markedly after the first year.
Leading Companies Invest More
Leading Companies in People Analytics invest more than other companies and, on average, have larger teams relative to their organisation. The ratio of the people analytics team to total employee headcount for Leading Companies in 2022 is 1:2300 compared with 1:2900 for all companies. Furthermore, Leading Companies invest progressively year on year. The ratio for Leading Companies has strengthened in 2022 from 1:2500 in 2021.
What Do These Ratios Mean?
Our research highlights that those organisations with larger teams relative to their total employee headcount have a better ability to deliver sustainable value. It is no surprise, then, that the ratio for Leading Companies in 2022 is 1:2300, much better than the average ratio for all companies of 1:2900 shown above.
Leading Companies are considered the “best of the best” in people analytics. They consistently invest in their people analytics functions, including ensuring that they have a
suitable balance of people analytics consultants, data scientists, and behavioural scientists. Leading Companies also employ people that can provide expertise in employee listening/experience, upskilling HR, and people analytics technology. Furthermore, they productise people analytics solutions to scale to employees, managers and executives. These topic areas are the responsibility of Leading Companies.
The size of the people analytics team relative to the total employee headcount is essential. And the better the ratio is, the more opportunity there is for creating business impact from people analytics.
The results of this research – from both 2020 to 2022 – will help leaders to impact business value through people analytics and secure further engagement and investment from business leaders and stakeholders. Download the 2022 report now and use the ratio to make the case for the accelerated growth of your team.
Feeling Inspired?
Check out these stories from People Analytics leaders who have successfully scaled their people analytics teams:
ABOUT THE AUTHOR
Naomi Verghese is currently the Managing Director for the Insight222 People Analytics Program®. This program develops the knowledge and skills of people analytics leaders and their teams to increase value, impact and focus through learning, networking and advisory solutions. Prior to joining Insight222, Naomi developed and led the people analytics consulting team at Barclays Bank Plc. She has also held roles as an HR business partner and in reward management.
Our Insight222 People Analytics Program® develops the knowledge and capabilities of people analytics leaders and their teams. It is the only networking and learning program in the world, dedicated to people analytics leaders and delivered by ex-practitioners.
Through a variety of learning and networking solutions, Insight222® enables people analytics leaders and their functions to deliver greater value and improve their impact. Sign up today and gain the insights and networking opportunities to optimising your team today!