The Current State of Human Capital Analytics Implementation

January 17, 2011

By Brad Minor, M.Ed. Candidate in Human Resource Development, Peabody College of Vanderbilt University

Unfortunately, in the current state of human resource (HR) affairs, human capital analytics (HCA) seems to be the normative view rather than the norm. Today’s HR professionals are placing their focus on historical data and cost reporting rather than analyzing and reporting on metrics that have the ability to drive strategic decision making. The exact reason for this is unclear, but a lack of executive support for the full implementation of HR analytics in the workplace might be one of the problems. This is obviously a touchy subject, because measuring and reporting the negative performance of one’s superior could lead to political problems for the individual or individuals charged with the responsibilities of reporting and/or measuring. Common sense dictates that it is not politically savvy to “bite the hand that feeds you.”

Forward momentum for the widespread use of HCA may be on the horizon. Business people are beginning to understand the importance of human capital to the bottom line. We need to move past reporting basic metrics, like costs and turnover rates, and into deeper analyses of the various HR issues that impact business results and drive strategic decision making, and this should become easier to accomplish as more businesspeople and investors begin to understand the true value of HCA and how they can use it to their advantage. One way for HR professionals to start making these connections to business results and strategy might be to map out these connections. It might help to literally draw maps of the connections between HR, strategy, and the desired business results, and then hang these visuals in our offices. These maps could become useful references when making a number of HR decisions, and they might keep us focused on what really matters.