Analytics and EBHR
Key Findings: Strong Foundations EBHR
Evidence-based HR (EBHR) is a process which delivers better informed and hence more accurate answers to two fundamental questions. First, which are the most important problems (or opportunities) facing the organisation which are relevant to HR? Second, which solutions (or interventions) are most likely to help?
The fundamental idea underpinning EBHR is that we are more likely to identify important problems or opportunities for improvement, or to develop effective solutions, if we follow the principles of evidence and incorporate critical thinking in our decision-making. The discipline of EBHR can help HR avoid fads and fashions and most importantly help focus on supporting the organisation to deliver its objectives. EBHR can help HR shift from justifying its existence to using evidence to identify appropriate courses of action in response to business needs. It provides strong foundations upon which HR can build its business impact and effectiveness.
Being evidence-driven means adopting three principles:
- incorporating multiple sources and types of evidence and information into decision-making,
- adopting a structured and explicit process to gather data and use evidence, and
- focusing on the most trustworthy and relevant evidence.
The EBHR process involves six steps:
- Designing and asking answerable questions to help identify the problem/opportunity or solution/intervention
- Collecting evidence of different types from multiple sources which will help answer the question
- Rating the trustworthiness and relevance of the evidence
- Aggregating the most trustworthy and relevant evidence
- Applying this evidence to answer the questions which help identify the problem/opportunity or solution/intervention
- Assessing the process and outcome.
A common misunderstanding of EBHR is that it is just about using scientific data. Evidence-based practice is actually about using multiple sources of evidence. We identify four sources of evidence that are particularly relevant to HR: stakeholders’ views and perspectives; the professional expertise of practitioners; evidence from inside the organisation; and scientific evidence.
One of the biggest developments in HR over the last decade has been the rise of HR analytics. Technology, analytical methods, awareness of privacy and ethical issues and the availability of data are progressing rapidly. Analytics can be a useful source of evidence and there is significant potential in using analytics to improve HR decision-making. However, analytics is not contributing to EBHR as much as we might expect. To address this challenge, it’s important to start in the right place: focus on the business strategy to identify where analytics is likely to add value to the most important business outcomes.
EBHR needs to take account of the politics and power dynamics of organisations and the influence of key stakeholders. Getting early input from senior management and internal customers is fundamental. Their continuing involvement in developing solutions makes it much more likely that senior managers are bought in to the proposed solutions, and also that they have real desire to make change happen and are committed to taking the necessary steps.
We consider how far EBHR has come since CRF’s last research in 2011. We found that HR professionals have become more aware of the concept of EBHR and aspire to be more evidence-based. The expectations of HR’s stakeholders have evolved and enablers such as technology and data have progressed. We conclude there is still some way to go for HR to achieve the potential benefits of EBHR in terms of impact on business outcomes.
From our research we identify nine key themes that summarise what we see as the current state of play:
- HR now has access to more data than ever and is using it more, but this is not necessarily leading to greater insight and better-informed decisions. Often, other functions are some way ahead of HR in their use of data and analytics.
- Multiple sources of evidence are used to some extent, but not as much as they could be.
- Understanding and application of EBHR as a defined process and approach is limited. HR practitioners often lack confidence in applying EBHR principles.
- Some organisations are doing something very close to EBHR.
- Evidence and data should be used to help HR support the business in achieving its goals, not to justify HR’s existence. The key is to evaluate how HR initiatives impact business outcomes in a meaningful way.
- EBHR is not complicated but it is difficult. There are many barriers such as the commercial and analytical capacity of HR professionals and availability of data. The capability of HR – both competence and confidence – needs to be developed.
- The quality of data and evidence could be better. We need to focus on using the best available data to avoid the ‘garbage-in, garbage-out’ problem.
- Evidence from external benchmarking or what others do needs to be treated with caution. Just because something works elsewhere doesn’t mean it will work in your organisation and popular activities may simply be fads.
- EBHR is political and stakeholders need to be included in the dialogue about evidence.
We set out the principal barriers to EBHR. These include the difficulty of quantifying business benefits and establishing links between cause and effect of HR actions, access to relevant and robust evidence, navigating the power dynamics of organisations, and the skills of the HR profession.
We identify some quick wins that HR could easily adopt to become more evidence-based in our work. These include better sense-checking of our arguments and evidence, using existing data better and more often, benchmarking judiciously and with caution, focusing on implementation not just design, and evaluating to improve practice. We provide some practical checklists to assist professionals in these areas.
Is EBHR worth it? It’s important to remember that EBHR is about making better-informed, not perfect, decisions. By following the EBHR process, we will be better positioned to identify the most relevant business issues, to develop more effective solutions and make a difference to business outcomes. In the next stage of our research, to be published in 2024, we will develop a range of practical resources and detailed guidance that HR professionals can use to deepen their practice of EBHR.
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