Despite collecting data on multiple people issues, many businesses do not regularly review it or use it to inform company decisions, a new report has found.
The CIPD survey – conducted between August and September 2022, as part of its Effective workforce reporting: Improving people data for business leaders report – found that much more data is being collected than reviewed, as a third (30 per cent) of respondents said the people information they receive did not give them the “full picture”, while one fifth (22 per cent) said it was not clear how the data connected to organisational priorities.
The results from 1,560 HR and business leaders indicated that less than half (46 per cent) of organisations collected data on recruitment, and just a third (33 per cent) reviewed it at least every six months.
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Additionally, of the 46 per cent of organisations that collected diversity data, only one fifth (24 per cent) said they reviewed it regularly. This was followed by training and development for which more than two fifths (44 per cent) collected it, and only 29 per cent regularly reviewed it.
Just under half (47 per cent) collected data on wellbeing, but only a quarter (26 per cent) regularly reviewed it.
The CIPD warned that “organisations are unlikely to perform well in the long term unless decisions taken at a board and executive management level are informed by an in-depth and evidence-based understanding of the value and risk their workforce poses”.
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But only 12 per cent of business leaders said workforce matters were discussed at every board meeting, with one fifth (20 per cent) saying they were often discussed and 23 per cent saying they were sometimes discussed.
David Collings, professor of human resource management at Dublin City University, emphasised the importance of data when attempting to remedy people issues within the organisation. “Knowing how to run analysis is important, but absolutely essential is framing that analysis in a language and story that resonates with key stakeholders. That is where the storytelling comes in,” he said, adding that “without effective storytelling, data analysis will always fall short”.
Tips for improving data-led decision making
Offering advice for organisations to improve decision making informed by data,
Guy Pink, HR lecturer, writer and consultant, said improvement should start with a clear understanding of why you collect it and for what purposes. “If HR and company leaders are still managing by intuition and not on facts then this might explain the gap,” he said.
While systems for collection and analysis are expensive and not always suited to needs, Pink advised that sometimes organisations focusing on several relevant data sets, instead of a pool of data, could be more effective as “starting small and showing the benefits will change approaches and mindsets”.
Business confidence using people data
Sally Bendtson, founder of Limelight HR, said people professionals – who are often under pressure to deliver more with under-resourced teams – can struggle with data as they “don’t feel they have sufficient knowledge or expertise to collate and manage meaningful data”.
“If they do provide the data to leaders, they can find it is reviewed as a tick-box exercise and doesn’t have the required impact on strategic direction."
However, Helen Astill, HR services director at Business HR Solutions, said that many businesses “still haven't grasped” that people professionals can use data to better understand issues in the firm. “They haven’t understood that by gathering and analysing data we can understand the trends and produce ideas to address critical issues,” said Astill.
“The problem is that where senior management teams have no HR representation, they are missing out on a wealth of knowledge and experience that they could draw upon."
In addition, Tomas Chamorro-Premuzic, professor of business psychology at Columbia University and UCL, said a reason that employee data might not be used as effectively by teams is that too much data can be “confusing, perplexing and overwhelming”.
“Most HR teams have made great progress becoming more data driven, but an avalanche of data decreases your ability to distil it into actionable insights,” he said.