Introduction to

HR Analytics
Unit -1
UNIT 1

1. Understanding core concepts of HR Analytics.

2. Business Intelligence, Business analytics and its Evolution.
3. Role of Data in HR, Assembling Data, Describing Data, Visualization.
4. Measures of Data, Probability and Managing Uncertainty.
5. HR Analytics: The Third Wave for HR value creation.
1. Understanding
core concepts of HR
Analytics.
Human Resources refers to both the people within an
organization and the department responsible for managing
those people. HR encompasses the entire employee
lifecycle, from recruitment and onboarding to training,
compensation, performance management, and even exit
strategies.
Analytics is the process of examining data to
find trends, patterns, and insights that can be
used to make informed decisions. It involves
collecting, cleaning, analyzing, and
interpreting data to understand past events,
predict future outcomes, and ultimately
improve performance.
 HR Metrics
Definition:
HR metrics are quantitative measurements used to
evaluate and monitor the efficiency and performance of
HR activities. They provide raw data and indicators
that help track progress toward HR and organizational
goals.

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HR Metrics Purpose and Characteristics

• Descriptive in nature (What

• To measure operational
happened?)
performance.
• Historical and lagging
• To identify trends in HR indicators (data from the
processes (e.g., past)
recruitment, absenteeism, • Easy to calculate, often used
turnover). in HR dashboards and
reports
• To support reporting to
management. • Primarily used for
monitoring and reporting,
not for making predictions

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 HR Analytics
Definition:

HR Analytics is the systematic identification and

quantification of the people drivers of business
outcomes. It involves using data-driven techniques and
statistical tools to gain insights, identify trends, and
inform HR decision-making.

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HR Analytics Purpose and Characteristics

• Includes diagnostic analytics

• To go beyond tracking and (Why did it happen?),
predictive analytics (What
actually explain and might happen?), and
predict HR phenomena prescriptive analytics (What
should we do?)
• To provide insights that • Relies on statistical models,
correlation, regression, etc.
influence HR strategies
• Improves decision-making in
and policies areas like recruitment,
retention, training, and
• To support evidence-based engagement
decision-making • Often used for talent
management and strategic
workforce planning

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 People Analytics
Definition:

People Analytics is a broader, interdisciplinary approach

that uses data about people (not just from HR, but across the
organization) to inform business-level decisions. It
integrates HR data with data from other business functions
to provide a holistic view of the workforce.

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People Analytics Purpose and Characteristics

• Integrates data from

• To align workforce strategies multiple sources (HRIS,
with business strategies CRM, collaboration tools,
performance systems)
• To optimize employee • Employs advanced
experience, performance, technologies such as
and organizational outcomes machine learning, AI,
network analysis
• To create a data-driven • Addresses questions about
culture within the organizational culture,
organization collaboration, innovation,
and performance
• Focuses on real-time,
predictive, and prescriptive
solutions

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Dimension HR Metrics HR Analytics People Analytics

Scope HR-specific KPIs HR data analysis Enterprise-wide data on people

Purpose Monitoring performance Explaining/predicting trends Strategic decision-making

Diagnostic, Predictive, Predictive and prescriptive

Type of Analysis Descriptive
Prescriptive with broader scope

Users HR professionals HR analysts, decision-makers Executives, HR, data scientists

Statistical software (SPSS, R, Big data platforms, AI, ML,

Tools Dashboards, Excel
Python) network tools

HR data, surveys, performance HR + business data, social

Data Sources HR systems only
metrics data, IT systems
LINKING HR ANALYTICS TO BUSINESS KPIS

Business KPIs are quantifiable measures used by organizations to evaluate success in achieving strategic and operational
goals. HR analytics becomes valuable when it can demonstrate a clear connection between people-related metrics and
these business outcomes.
KEY AREAS WHERE HR ANALYTICS IMPACTS BUSINESS KPIs

Talent Acquisition and Productivity

Employee Retention and Profitability

Learning and Development (L&D) and

Performance

Employee Engagement and Customer Satisfaction

Workforce Planning and Profitability

INCORPORATE WITH HR FUNCTIONS

Stage Example Question Insight Gained

Descriptive What is our annual employee turnover rate? 18% turnover in the last year
High turnover in specific departments
Diagnostic Why are employees leaving?
due to low morale
Model identifies 25 employees at high
Predictive Which employees are likely to leave soon?
risk
Suggest offering flexible work
Prescriptive How can we reduce future attrition? schedules and career development
plans
 Role of analytics in strategic HRM

Workforce Planning and Optimization

Talent Acquisition and Recruitment Strategy

Employee Engagement and Retention

Definition
Performance Management
• HR Analytics refers to the systematic collection, analysis,
and interpretation of HR data to support strategic Learning and Development (L&D)
decision-making. It integrates traditional HR practices with
data science and business intelligence, enabling HR to act as Diversity, Equity, and Inclusion (DEI)
a strategic partner in the organization.
Strategic Decision-Making and HR Policy
Development
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2.Business
Intelligence,
Business analytics
and its Evolution.
Business Intelligence (BI) and Business Analytics (BA)

Business Intelligence (BI) and Business Analytics (BA) are interconnected disciplines that empower
organizations to make data-driven decisions. While BI focuses on descriptive and diagnostic insights
into historical data, BA emphasizes predictive and prescriptive analysis to forecast and shape the future.
Evolution of Business Analytics

Early Stages (1960s Growth of Data

– 1980s) Warehousing(1990s)

Rise of Big Data and

Modern Era
Advanced
(2010s-Present)
Analytics(2000s)
3.Role of Data in HR,
Assembling Data,
Describing Data,
Visualization.
Da
ta C
oll
ect
ion
HR ANALYTICS PROCESS

An
Int alysis
erp an
ret d
ati
on

De
Im cision
ple
me and
nta
tio
n
Data Processing In HR

Describing Visualizatio
Assembling Data
Data n
4.Measures of Data,
Probability and
Managing
Uncertainty.
Measurements

1. Measures of Data
2. Probability
3. Managing Uncertainty
 SUMMARIZATION

Technique Purpose
Descriptive statistics Summarize data using mean, median, %
Correlation and regression Understand relationships between variables
Predictive modeling Forecast attrition, performance, hiring success
Classification techniques Segment employees into risk/performance groups
Clustering (e.g., K-means) Group employees by similar characteristics
Sentiment analysis (NLP) Analyze feedback and survey responses
5.HR Analytics: The
Third Wave for HR
value creation.
3RD WAVE OF HR

1st Wave

2nd Wave

3rd Wave
NEXT UNIT WILL BE CONTINUED…..