The role of digital solutions in optimizing decision-making by the HR department

The role of digital solutions in optimizing decision-making by the HR department.

The requirements for HR professionals are constantly increasing. They should not only be business partners to their company’s management but also fulfill numerous other, often conflicting, functions. What determines the success of HR initiatives? How can a key department in a company make sound strategic decisions in the era of hybrid work based on dispersed data? What is the annual cost of employee turnover and how beneficial is it to initiate actions that influence employees’ decisions to stay in the company? There are many more questions that can be asked.

These are everyday dilemmas faced by HR managers in every company. Undoubtedly, one of the most important goals of HR is to keep employees for as long as possible. Making well-informed decisions based on organized and well-presented data will certainly help achieve this goal.

What are the biggest challenges for the HR department considering data?

Taking into account the importance of data in today’s business environment, the HR department may face some challenges related to data. Here are some of the key ones:

• Data collection and analysis: The challenge for the HR department is to collect and analyze data related to employees, such as personal information, employment histories, performance ratings, absences, salaries, etc. It is important to have appropriate systems and tools that enable effective data collection and analysis.
• Integration of data from different systems: In an organization, there may be various data management systems, such as human resources information systems, payroll systems, recruitment systems, etc. The challenge for the HR department is to integrate data from these different systems to obtain a comprehensive and consistent view of employees.
• Data analysis for decision-making: Data is valuable when it is used for strategic decision-making. The challenge for the HR department is the ability to conduct effective data analysis and extract meaningful insights that can support decision-making related to recruitment, employee development, retention, compensation, etc.
• Maintaining data quality: Data needs to be up-to-date, accurate, and comprehensive to be useful for the HR department. The challenge is to maintain data quality through regular updates, verifications, and monitoring of data integrity.
• Compliance with data protection regulations: The HR department needs to be aware of and comply with data protection regulations, such as the GDPR or general principles of personal data protection. The challenge is to ensure compliance with regulations and take action to minimize the risk of non-compliance.

Faced with these challenges, the HR department needs to invest in appropriate resources, technologies, and competencies to effectively manage data and leverage it for key decision-making regarding employees and organizational strategy.

Measuring employee satisfaction as key data for analysis.

Measuring employee satisfaction is crucial for organizations because satisfied employees are more engaged, productive, and loyal to their employers. Here are some key indicators that can be used to assess employee satisfaction:

• Employee satisfaction surveys: Surveys are a popular tool for measuring employee satisfaction. By asking questionnaires about various aspects of work, such as employment conditions, compensation, professional development, and relationships with colleagues, feedback can be obtained from employees. Surveys can be anonymous to encourage employees to provide honest opinions.
• Employee turnover rate: A high employee turnover rate may indicate dissatisfaction with working conditions. Monitoring the number of employees who leave the organization within a specific period can provide insights into the level of employee satisfaction.
• Absenteeism and attendance rate: A high rate of absenteeism or frequent absences can be a sign of low employee satisfaction. Regularly monitoring employee attendance can help identify satisfaction-related issues.
• Performance evaluations and ratings: Systematic evaluations of employees and their performance can provide feedback on their achievements, progress, and professional development. Regular performance review meetings can serve as a platform for discussing employee satisfaction and needs.
• Employee engagement index: Engaged employees are typically more satisfied. Employee engagement indicators, such as the level of task engagement, participation in organizational initiatives, or involvement in training, can provide information about the level of satisfaction.
• Feedback from employees: Feedback from employees can provide insights into the quality of work and employee satisfaction. Positive feedback from customers can indicate a high level of employee satisfaction.

Monitoring and analyzing these key indicators allows organizations to better understand employee satisfaction and take appropriate actions to improve their workplace experience. It is also important to regularly collect feedback from employees and take action based on this feedback to increase employee satisfaction and engagement.

Employee satisfaction survey

Returning to one of the main goals of HR, which is employee retention, the simplest and most effective method is to conduct a satisfaction survey that examines the motivations and willingness to work in the company. These motivations can include:

• Job Stability: Employees can be motivated to stay in a company by job stability and long-term growth prospects within the organization.
• Professional Development: The opportunity for career development and acquiring new skills can be a strong motivator for employees.
• Satisfaction with Compensation: Compensation and benefits, such as bonuses, allowances, or benefits packages, can impact employee satisfaction and their desire to stay in the company.
• Support from Supervisors: Positive relationships with supervisors and receiving support and feedback from them can have a significant impact on employee motivation to remain in the organization.
• Challenging Tasks and Projects: Engaging and interesting tasks and involvement in exciting projects can be a motivation for employees who want to develop their skills and achieve professional success.
• Organizational Culture: Employees can be motivated by a friendly, supportive, and inspiring organizational culture that fosters a positive work environment.
• Work-Life Balance: Employees may appreciate a company that promotes work-life balance and offers flexible solutions such as remote work or flexible working hours.
• Employee Net Promoter Score (NPS) – a key indicator of engagement and satisfaction in the workplace. This indicator will be further described in the subsequent part of the article.

Conducting a satisfaction survey among employees regarding these motivations can help understand what drives employees to stay in the company and what actions can be taken to increase employee retention.

Net Promoter Score

What is Employee Net Promoter Score (NPS)? Employee Net Promoter Score is a measure that helps organizations evaluate the level of engagement and satisfaction among employees in the workplace. Similar to customer NPS, employees are asked how likely they are to recommend their company as a place to work to others. The rating scale also ranges from 0 to 10, and employees are divided into three groups:

• Promoters (ratings 9-10): Employees who give the highest ratings are engaged, satisfied, and loyal to the organization. They willingly recommend their company as an employer to others.
• Passives (ratings 7-8): Employees who give neutral ratings are satisfied but may not necessarily recommend the company as an employer to others.
• Detractors (ratings 0-6): Employees who give low ratings may experience dissatisfaction, lack of engagement, or negative experiences in the workplace. They are less likely to recommend the company as an employer.

Employee Net Promoter Score (NPS) is an important metric that helps organizations assess the level of employee engagement and satisfaction in the workplace. A high NPS indicates loyal and engaged employees, which has a positive impact on productivity, retention, and talent acquisition. Organizations should regularly monitor Employee NPS and take action to improve their employees’ professional experience.

How to make strategic decisions from the HR perspective?

In the era of hybrid work, where employees are often scattered across different locations, HR professionals face the challenge of gathering and analyzing dispersed data. Making informed decisions requires the ability to access and interpret relevant information from various sources. HR departments can leverage technology solutions, such as data analytics tools and HR management systems, to centralize and analyze data effectively. By harnessing the power of data, HR can gain valuable insights into employee needs, preferences, and performance, enabling them to make informed decisions and develop tailored strategies.

All that can be supported by Power BI (data visualization and business analytics tool) that can assist HR departments in making key decisions. Here are a few ways in which Power BI can be beneficial for HR:

• Monitoring key HR metrics: Power BI enables the creation of interactive and dynamic dashboards that aggregate and visualize data related to employee headcount, turnover, compensation, absenteeism, engagement, and other HR metrics.
• Analysis of HR process effectiveness: Power BI allows for the analysis of HR process effectiveness, such as recruitment, performance evaluation, training and development, and compensation management. The HR department can track and evaluate metrics such as process duration, success rates, costs, and other factors impacting process efficiency and quality.
• Employee engagement analysis: Power BI enables the collection of employee engagement data through surveys, studies, or other tools. The HR department can utilize this data to create interactive dashboards that present real-time engagement results. This allows HR to identify areas where employees may need support and take actions to improve employee engagement and satisfaction. Taking into account the analysis of employee satisfaction surveys, the data can be prepared in a way that enables analysis from multiple perspectives – both for specific departments and the average score for the entire organization.
• Workforce forecasting and planning: Power BI facilitates the analysis of historical employee data related to headcount and turnover, which can help the HR department forecast future workforce needs and plan human resources accordingly.

Power BI provides tools and data visualization capabilities that empower HR departments to take a more strategic approach to analysis and decision-making. This enables HR to better understand data, identify patterns and trends, and take effective actions to improve efficiency, employee engagement, achieve organizational goals and make data-driven decisions.

Key Takeaways from this Article

• The HR department needs to analyze a lot of data that is scattered across different locations. This often leads to data silos, resulting in crucial decisions being based on incorrect conclusions.
• To effectively achieve one of the main goals of the HR department, which is employee retention, it is valuable to be aware of their level of job satisfaction within the company. To accomplish this, it is necessary to gather information from them, for example, through surveys and Microsoft Forms, and then have the ability to analyze the results in a reliable and straightforward manner.
• There are definitely more indicators in the HR department that are analyzed on a daily basis, including Employee turnover rate, internal employee movement, workforce productivity, employee absenteeism, overtime hours, average recruitment duration, average recruitment costs, etc. By regularly analyzing these indicators, the HR Department can gain valuable insights into various aspects and make proper decisions to improve overall organizational performance
• Data analytics, along with tools like PowerBi, addresses the needs associated with easy access to all the necessary HR data, thereby facilitating the achievement of organizational goals. PowerBi is a powerful business intelligence tool, that allows HR Department to analyze, and visualize data in a user-friendly and efficient manner.

Thank you for reading this article.

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