The latest study from HR.com’s HR Research Institute (HRRI) highlights the fact that most organizations fail to use people analytics very effectively. In fact, only 22% of companies report being "very" or "extremely" effective at getting the most out of their HR analytics capabilities, despite noticeable improvements in data gathering and evaluation over the past few years.
"The challenge now is moving beyond data collection and ensuring that organizations can make data-driven decisions that lead to real business impact."
The good news is that half of HR professionals (50%) now rate their organization’s data evaluation and understanding capabilities for people analytics as 'good' or 'very good,' marking a significant rise from 36% in 2021.
However, while data evaluation skills are improving, many organizations still face challenges in optimizing the potential of their people analytics. One key reason for this perceived ineffectiveness is the failure to integrate business data with HR data. The study revealed that only about a fifth of organizations consistently integrate business data with people data, limiting their ability to gain a comprehensive understanding of the workforce in relation to broader business objectives.
The study identifies the top three key challenges in people analytics that organizations continue to face:
Integrating disparate sources of data – 47% of respondents noted difficulties in bringing together data from different systems.
Implementing programs based on analytics-derived decisions – 41% of organizations struggle with turning insights into actionable programs.
Distribution and communication of data – 33% of HR professionals highlighted the challenge of effectively sharing data insights within their organization.
"While we've seen clear progress in how organizations gather and analyze HR data, there’s still a long way to go in terms of translating those insights into actionable strategies," stated Debbie McGrath, Chief Instigator and CEO of HR.com. "The challenge now is moving beyond data collection and ensuring that organizations can make data-driven decisions that lead to real business impact."
The full research report, HR.com's State of People Analytics 2024-25, is available for free download and offers detailed insights and actionable recommendations for HR professionals looking to improve HR data collection, metrics, and analytics to help make informed data-based decisions in all areas of workforce management and planning.
The recording of the research webcast presentation, How to Boost People Analytics Effectiveness in Your Organization, is available for viewing 24/7 on demand.
About HR.com and the HR Research Institute
The HR Research Institute (HRRI) helps you keep your finger on the pulse of HR! Powered by HR.com, the world’s largest HR community, the HRRI identifies key trends and best practices to help more than 2 million HR professionals and their organizations make strategic decisions with informed and insightful research findings. Among the most productive and respected HR research institutes globally, the HRRI publishes dozens of high-quality reports every year across a wide array of HR topics. HR.com’s free membership offers many benefits, including access to over 250 exclusive primary research, state-of-the-industry reports, and infographics. These resources are published based on surveys developed with the assistance of a panel of thought leaders and industry experts on the advisory boards. Visit hr.com/hrresearchinstitute to maximize your HR potential.
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