But, how do we get that approximation? Thanks to Big Data, one of the most talked-about new technologies in recent years. The data analysis-related sector is constantly growing. The market research firm IDC claims that global Big Data revenue will increase from 100 000 million in 2016 to around 160 000 million in 2020. Exploitation of information on a large scale is revolutionizing resource management in every sector, and human capital is certainly not an exception.
In defence of data
The recruitment company Woo is a good example of this. They have developed an artificial intelligence-based platform capable of matching vacancies in certain companies to professional profiles so as to select the most suitable candidates in accordance with the criteria demanded for an available position. And their choices, based on data analytics, are validated by good results: 52% of profiles selected by the AI system (called Helena) pass their final interview with the client.
Big Data-based recruiting systems are a response to a real demand in the market. A survey by the recruitment agency Manpower shows that 26% of companies do not find the professional profiles they require. If dating apps have changed the way people find a soul mate, why shouldn’t an algorithm do the same for work relationships?
Nobel Prize laureate Daniel Kahneman, father of behavioural economics, defends the use of algorithms when it comes to selecting the most suitable candidate. He argues that human brain makes numerous mistakes when taking a decision, due to bias or what he calls “noise”, understood as influence of the context. These mistakes have an impact on recruitment processes. If based on appropriate data, an algorithm can do a better job.
Is this what people analytics is about?
Systems relying on these kind of technology to locate human talent are known as people analytics. And they’re useful not only for finding the best candidate. “Data analytics brings you the keys to locate the talent required by your company, but also allows you to know the people already working there even better”, explained LinkedIn’s CEO Jeff Weiner during an event in which the platform presented their new tools, oriented to work around these solutions.
After all, one of the aspects most favoured by the implementation of data research into talent management is the realization that people are not just independent individuals sharing a space in a company, but professionals capable of optimizing the performance of work teams. The paradigm shift lies greatly in the coordination of diverse profiles in order to carry a project forward. A valuable employee is the one enhancing the work of those around him. Enhancing the team is a crucial task regarding good work dynamics in a company, and the metric against which performance should be appraised.
Acceptance of the system
The perception this trend is acquiring regarding talent recruiting and monitoring inside organizations is one of increasing importance. A survey conducted by the consulting firm Deloitte reflects that 61% of Spanish companies agree on considering people analytics as a necessary transitioning tool to be implemented across the organizational structure of their HR departments. In USA, United Kingdom, Holland and China, three out of four companies are already willing to bank on this trend.
And its implementation is gaining momentum. Half of the large-company CEOs consulted by PwC during a recent study are already utilizing data analytics management in their organizations. The consulting firm McKinsey evaluated the results obtained after getting a people analytics strategy started in a fast food restaurant chain, and the numbers were certainly clarifying. After a four-month pilot test, customer satisfaction ratings increased by 100%, orders were delivered 30 seconds faster, motivation of new employees was boosted and sales increased by 5%.
Sources: IDC, SAP, Manpower Group, Deloitte, PwC, McKinsey