6 Essential Features of People Analytics Software

If you’re someone who is looking to your people data for more-informed workforce planning, compensation planning, and performance management, you’re not alone. In fact, more HR leaders are looking for these solutions right now more than ever.

In the last ten years, people analytics has evolved from the luxury of a few large tech companies to a highly accessible must-have for any people ops team. Specifically, a Deloitte study found that more than 70% of organizations are investing in people analytics to make data-driven decisions about their workforce.

These insights are now more accessible than ever thanks to people analytics software, also known as HR analytics software. But finding the right solution to help drive insights to your people data isn’t straightforward, especially because there’s a lot of players in the multi-billion dollar industry. Talk about an overwhelming decision to make.

While there’s no ideal solution across every team, certain characteristics are essential when it comes to analyzing your HR data. By looking for the six features listed below, you can better position your team to adopt people analytics effectively.

1. Data Aggregation

One of the most important features to look for in people analytics software is its ability to aggregate data. In short, data aggregation is the process of centralizing multiple data sources to create a “single source of truth” for your people data.

In many cases, people data is scattered across the organization. You might have to pull in compensation planning information from one database, applicant tracking from another… and then you still have to export all of that data to a spreadsheet. No thanks.

Alternatively, a people operations solution (with analytics functions) should handle these steps for you by automatically merging people data from different HR systems, ideally on an ongoing basis to capture changes to your organization in real-time.

Ongoing updates are extremely important, as a one-time aggregation will only offer a moment-in-time snapshot, which will not accurately reflect the dynamic nature of an organization over time. When you know your data is always up-to-date, your team can easily gather all the information they need and tie insights back to business goals. In short, this type of data aggregation gives you a complete picture of your organization.

The right people operations platform has a variety of HR data filters so you can identify any themes and act on them accordingly.

A Data Aggregation Example

John wants to cut his organization’s turnover rate. He therefore needs to analyze data around employees who have left his company. This type of attrition analysis involves knowing aspects such as how those employees responded to engagement surveys, whether they were recently promoted or received a salary increase, and which development programs they attended.

Luckily, John can use people analytics software with automatic data aggregation to bring all of this data together in one comprehensive report. And by filtering the data through different lenses, such as age and department, he can identify any themes and make data-informed decisions to help cut the turnover rate.

2. HR Technology Integration

Data aggregation goes hand-in-hand with technology integration. You need your tech, especially your HR tech, to play nicely with the rest of your tech stack. Ultimately this means actively choosing partners and technologies who value open data systems.

Seamless integrations improve People processes, as there’s a clear link between HR technology integration and People team performance. According to a report from the HR Research Institute, connected tech stacks produce more actionable and accurate data.

As a result, it’s important to prioritize analytics tools that integrate with your existing HR stack. Your people analytics software should connect with and sync HR data from tools like your human resource information system (HRIS), applicant tracking system (ATS), and performance management system.

Your people operations platform should integrate with a variety of HR technology to give you the best, most insightful experience possible.

An Integration Example

Noel’s organization is planning on hiring seven new employees, all across various teams. Normally this would be a huge pain, but instead of managing numerous spreadsheets, emails, and open tabs, Noel just uses one dashboard: her people operations platform. That’s because her platform integrates with her company’s ATS so she and her team can plan, recruit, and report with confidence.

Since talent and leadership teams have already aligned on hiring goals and finalized plans within the platform, Noel opens roles in her org chart, which automatically feeds into her ATS. Now it’s time to hire, and luckily, she can see updated job details like hiring priority and job description to help her plan and find the best talent.

3. Reporting

Your people analytics software should be able to produce detailed reports about your people data. In other words, it should tell you what’s happening – ideally in real-time – in specific areas you want to measure.

John Sumser, principal analyst at HRExaminer, says People teams who are just getting started with HR analytics should look for software that comes with pre-built reports, which helps you jump in quickly and easily.

Ideally, your people analytics software has report templates, detailed guides, and customer support to ensure your organization is running the right reports to help you meet your specific goals.

Analytics software helps you discover trends in your HR data over time to help ensure you are on the right track.

A Reporting Example

As the company’s management trainer, Derrick wants to ensure managers’ employee reviews are equitable and fair. He runs a report on the most recent quarter’s performance reviews and applies a number of filters to the HR data to help spot any themes. He sees that the Customer Success team’s performance scores aren’t varied like other departments and knows he needs to follow up.

After making and implementing a plan with the Customer Success team lead, Derrick can look at the next cycle to see progress towards his goals.

4. Easy-to-Understand Analytics

Your People team shouldn’t require extensive training to make sense of the data. Therefore, look for a software that formats HR analytics in a way that’s easy to understand.

In fact, McKinsey suggests the more time it takes to simplify your data, the less effective your data-driven initiatives will be. To solve that problem, companies should prioritize formats that make “useful data accessible to the organization.”

When your people data lives in colorful graphs and charts instead of never-ending spreadsheets, it’s not only more approachable, but it allows people to develop quick insights that lead to more thoughtful decision-making.

An Analytics Example

Julie is her company’s newly-appointed DEIB Director, and her first order of business is understanding the diverse nature of her workforce. Because she uses a modern people operations platform with time travel capabilities, she can not only visualize the breakdown of her current organization, but also where they’ve been and how they’ve continuously worked towards their DEIB goals.

ChartHop’s time travel capabilities allow you to look at your org chart over the years to see successes and room for improvement.

5. Actionable Insights

It’s not enough for your people operations platform to provide visuals of your data. It also needs to help drive actionable insights that promote positive change in your business.

According to Harvard Business Review, employee data without insight “is meaningless.” Therefore, it’s critical to look for a people analytics software that not only produces reports, but also allows you to create data-driven plans in that same space.

This feature helps save time and reduces errors, as you’re not switching from sheet to sheet, manually entering data. Instead, you’re using your headcount plans to create different hiring scenarios, or allotting raises using performance data – all within the same platform.

Your ideal HR analytics solution allows you to create action plans using your people data – all within the same platform.

An Insights Example

A Gartner report found one-third of HR leaders cite a lack of visibility into current skills gaps as a major challenge. Luckily for UX team manager Gabe, his company’s people operations platform makes it easy to identify skills gaps. With it, he can see a centralized record of his entire workplace’s skills, which he then checks against the company roadmap to flag any gaps. Gabe then creates headcount plans directly inside the platform that take into account team goals and the necessary skills to get there.

In short, with a people operations platform, managers should be able to easily view their team’s current skills, check the company’s growth plans, and identify hiring gaps — and then use that insight to propose a new role based on their department’s needs.

6. Security

Any people analytics software you consider should protect employee data. This feature makes it essential to prioritize people analytics software that comes with access control and encryption.

The Society for Human Resource Management recommends HR teams think of a people operations platform as a secure data hub, as doing so means companies no longer have to share personal data via email. Look closely for solutions that are SOC 2 (Service Organization Control) Type 2 compliant. SOC 2 Type 2 is a set of data security standards developed by the American Institute of CPAs. When a people analytics vendor has completed a SOC 2 Type 2 examination, it means a third party has reviewed their security controls and found them effective.

Deloitte also suggests teams use permission controls to restrict access to employee information. HR frequently needs to make multiple copies of the same spreadsheet to protect sensitive data, but best-in-class HR analytics software provides granular controls that allow you to restrict access to employee information based on data points and roles (therefore avoiding the effort of duplicating spreadsheets – and the inevitable version control problems that come with it).

It’s important to note that traditional analytics tools won’t satisfy these security requirements because they can’t distinguish sensitive data in the same way that a dedicated people analytics software can.

A Security Example

Mina wants to check her compensation summary over the past three years. After logging into the company’s people operations platform, she easily navigates to the compensation tab to see her base salary, variable amount, vesting amount, total compensation, and current compensation band.

This information is private to Mina, her direct manager, and the People team – meaning the rest of her organization can’t see it when they view her profile.

Equipping your organization with people data shouldn’t be scary. Look for platforms with security features so the right people can access the right information.

Choose the Best People Analytics Software for Your Organization

When deciding which people analytics software to implement for your team, there are many features you’ll want to consider. Most notable are data aggregation, tech stack integration, reporting capabilities, easy-to-understand analytics, actionable insights, and data security.

Ultimately, with the right people analytics software, you’ll be able to make positive changes across the employee experience that contribute to better employee engagement and higher retention rates.

People operations platforms not only help you make data-driven decisions, they also help connect your organization (as in your people data, departments, and remote employees).