Data-driven analytics and human resources (HR) have long been seen as separate entities with little overlap. However, as we move further into the digital age, the two are becoming increasingly intertwined, especially in leading companies with strong people analytics functions. 

One key finding from the Insight222 People Analytics Trends 2022 Report was a 21% increase in the number of HR leaders reporting directly to the Chief Human Resources Officer (CHRO), highlighting the growing influence of people analytics on HR strategy and decision-making.

The follow-up report conducted this year found that people analytics is adding even more value to businesses, with 21% of people analytics leaders now presenting to the board and 58% presenting to the C-suite. 

This demonstrates the extent to which people analytics is becoming a vital component in shaping business outcomes, especially as data-driven analytics skills have been identified as the biggest skills gap in HR.

Driving Business Value Through Strategic Alignment

 The CHRO is the driving force behind all people-related strategies in an organisation. They are responsible for understanding key business problems and finding solutions, making them crucial stakeholders for any people analytics team. 

As Alexis Fink, VP of People Analytics and Workforce Strategy highlights on the Digital HR Leaders podcast, 

"the HR VPs, or in some cases the COE leads if you're talking about talent management or learning and development or others, they're the ones who have to consume what you're building, they're the ones who actually make the magic happen. And if you're not (a) meeting their needs, and (b) delivering in a way that's usable, you're not actually terribly valuable, you're just a pretty ornament."

In other words, the success of a people analytics function is heavily reliant on its alignment with the CHRO and their understanding and utilisation of the data provided. This close relationship between the two is imperative if an organisation wants to achieve: 

1. Improving workforce experiences – such as increasing employee engagement, promoting well-being, and creating a positive work culture.

2. Driving an analytics culture across the organisation – for example, democratising people data to managers and improving data literacy within HR.

3. Improving business performance – by increasing productivity, boosting sales, and delivering improved profits.

4. Creating broader societal benefits – through initiatives such as promoting diversity and inclusion and implementing sustainable people practices. 

Navigating Challenges and Seizing Opportunities

But how can we foster a strong relationship between HR and people analytics? 

It all boils down to one thing – speaking the same language. Just like any relationship, communication is key. Without it, misunderstandings and misaligned expectations can hinder progress and success. 

So, to strengthen this bond, both HR and people analytics professionals must be upskilled to ensure that they understand each other's roles and the value they bring to the organisation. And this all comes down to building a data-driven HR culture. 

People analytics teams need to understand the specific needs and challenges of HR professionals. At the same time, HR leaders and CHROs must also embrace data-driven decision-making to reap the full benefits of people analytics.

As our Insight222, Upskilling the HR Profession: Building Data Literacy at Scale report shows, both parties hold equal responsibility in creating a data-driven HR culture. 

The report reveals that when people analytics is responsible for upskilling HR professionals, 60% of organisations reported more data-driven HR practices, compared to only 31% where people analytics were not in charge of the upskilling process.

The same report found that when the CHRO and other HR leaders were actively involved in upskilling, the percentage of organisations with data-driven HR increased by 56%.

Essentially, both parties must be equally invested in developing data literacy and promoting a culture of data-driven decision-making within the organisation. This dual approach will ensure that both parties understand the value they bring to the organisation and can effectively collaborate to achieve common goals in driving HR strategies and, ultimately, business outcomes.

Embracing the Future of HR

As the relationship between HR and people analytics continues to strengthen, it's evident that this alignment is essential for driving business value.

The results are clear - organisations with strong strategic alignment between these two functions experience improved workforce experiences, a data-driven culture across the organisation, improved business performance, and broader societal benefits. 

To further explore the benefits and challenges of this strategic alignment, we invite you to download our 2023 People Analytics Trends Report and gain valuable insights on how leading companies leverage data-driven analytics in their HR practices.

And don’t forget to check out the Digital HR Leaders podcast to hear firsthand from industry leaders on the importance of this relationship and how it drives business impact. 

Unlock the potential of your people analytics function with our Insight222 People Analytics Program®

At Insight222, our mission is to make organisations better by putting people analytics at the centre of business and upskilling the HR profession. The Insight222 People Analytics Program® is your gateway to a world of knowledge, networking, and growth. Developed exclusively for people analytics leaders and their teams, the program equips you with the tools, insights, and connections you need to create greater impact.

As the landscape of people analytics becomes increasingly complex, with data, technology, and ethical considerations at the forefront, our People Analytics Program brings together over one hundred organisations to collectively address these challenges. Discover how joining the Insight222 People Analytics Program® can help you deliver real business value to your organisation.