Employee Analytics: HR’s Secret Weapon for Optimizing the Employee Experience
In today’s digital workplace, data is king. Especially when it comes to the employee experience.
Employee analytics and workplace data are essential instruments that help organizations create an employee experience people want to be a part of.
Employee analytics can include valuable workforce metrics, such as employee attrition, benefits, and engagement statistics. And, each of these data points weaves the story that reveals the employee experience at your organization.
However, employee analytics can be intimidating if you don’t know where to start. It can be even more daunting if HR leaders don’t have the right tools to harvest useful information.
Let’s dig into everything you need to know about measuring, tracking, and using employee analytics.
What Are Employee Analytics?
To better understand why employee analytics is important, let’s start from the beginning. What are employee analytics?
According to Gartner, employee analytics involves an “advanced set of data analysis tools and metrics for comprehensive workforce performance measurement and improvement.”
In essence, employee analytics provide organizations with a real-time snapshot of the employee experience. Businesses can then use that data to make improvements when and where needed.
Employee vs. People vs. Workplace Analytics
Employee analytics are often used interchangeably with workplace and people analytics. However, each is distinctive in its own right.
People analytics (also commonly referred to as HR analytics) measures HR-specific processes and techniques. People analytics are critical for fine-tuning the return on investment (ROI) for each employee.
More than 70% of companies say they consider people analytics to be a high priority.
Workplace analytics extend beyond retention metrics to analyze employee productivity, effectiveness, and engagement.
Examples of measuring workplace analytics include:
- Total collaboration hours
- Engagement with company communications
- Participation in employee pulse surveys
Employee analytics accounts for all these critical aspects to assess the organization’s overall health as it relates to the employee experience.
As a result, employee analytics look at HR and workplace-related data, such as:
- Attrition
- Engagement
- Productivity
- Training and development
- Compensation and benefits
Why Does Employee Analytics Matter
Organizations typically use employee analytics data for two specific purposes:
- Reviewing current workplace practices
- Influencing future activities
Evaluating existing team members and activities provides valuable insight for establishing effective organizational practices going forward.
For example, analyzing employee engagement analytics across technology platforms can indicate which tools are more valuable to specific employee groups. Using those findings, organizations can adapt their communication strategy to be more effective and engaging.
There are several critical benefits to measuring the employee experience, such as:
- Decreasing employee turnover rates. Employee analytics provide insight into factors causing employees to voluntarily or involuntarily leave the organization. Businesses can then work to address these areas to keep their employees happy, engaged, and loyal.
- Equipping managers to make better decisions. With detailed analytics, company leaders can better understand where they need to make improvements. For instance, managers can adapt the onboarding process if employees are not getting what they need to be successful.
- Positively impacting business performance. According to MIT’s Center for Information Systems Research (CISR), businesses with better employee experiences have higher customer satisfaction and 25% higher profits.
Other benefits of employee analytics include:
- Improving hiring and recruiting practices
- Creating an authentic company culture that attracts new talent
- Increasing employee engagement
- Generating next-level employee loyalty, motivation, and work ethic
Common Examples Of Employee Analytics
Given the broad and complex nature of employee analytics, understanding actionable insights from your workforce data can sometimes feel overwhelming. But, it doesn’t have to be!
Here are some must-know examples of employee analytics in the workplace.
Employee Attrition Analytics
Employee attrition occurs when an organization loses an employee through natural processes, such as resignation, retirement, illness, or the employee simply doesn’t want to return from leave. When it comes to attrition, the employee is usually not replaced for an extended time – if at all.
There are two forms of employee attrition:
- Voluntary: The situation in which an employee chooses to leave by their decision. Think: resignation.
- Involuntary: The situation in which the organization forces the employee’s hand in parting ways. Involuntary employee attrition is usually found in restructures or reorganizations, position eliminations, or layoffs.
Pro tip: It’s important to know employee attrition and employee retention are two completely different measurements. Employee attrition tracks employees leaving, whereas employee retention accounts for employees that stay with the organization.
Employee attrition analytics generally indicate how fast your workforce is leaving your organization. However, employee attrition can signify cost-cutting success if it is viewed as an operational efficiency tactic.
The most common employee attrition metric is the employee attrition rate
Employee Benefits Analytics
Employee benefits are a significant factor in attracting and retaining talent. In fact, 64% of millennial workers say benefits are extremely or very important to employee loyalty. And, 83% of employees say health insurance is a top deciding factor when changing jobs.
Common types of employee benefits are:
- Health insurance
- Paid time off
- Family and medical leave (FMLA)
- Retirement savings and/or contributions
- Disability insurance
- Life insurance
However, there are several workplace benefits that are becoming more common in employment packages, such as:
- Mental health support
- Wellness programs
- Training, tuition, and student loan repayment support
- Commuter benefits
Employee benefits costs can stack up pretty quickly. So, it’s natural for organizations to review how their costs compare to the rest of the industry.
Enter: employee benefits analytics.
Common types of employee benefits metrics include:
- Health care cost per employee
- Overtime
- Benefits satisfaction
Health care cost per employee measures the total cost of health care benefits to the number of participating employees.
Overtime percentage tracks how much a company’s payroll is allotted to overtime expenses.
Benefits satisfaction traces how happy employees are with the organization’s benefits package. Benefits satisfaction is typically measured through employee surveys where workers can provide transparent feedback directly to their leaders.
Employee Engagement Analytics
Employee engagement is an essential component of business success. Why? Because employee engagement can impact almost every aspect of the business, including:
- Operational efficiency
- Employee experience
- Customer satisfaction
- Business profits
- Company culture and reputation
- Employee productivity
Gallup defines engaged employees as, “those who are involved in, enthusiastic about and committed to their work and workplace.” Gallup also indicates that almost 85% of employees are actively disengaged at the workplace.
Because employee engagement has a direct impact on organizational performance, businesses are ramping up efforts to boost employee satisfaction.
Deloitte estimates U.S. companies spend more than $1 billion in employee engagement efforts alone.
However, employee engagement can be challenging to measure without the right tools.
Organizations typically measure employee engagement through:
- Employee surveys
- Employee collaboration platforms
- Internal communications
When it comes to quantitative employee engagement analytics, organizations often look at:
- Employee Net Promoter Score (NPS)
- Absenteeism
- Turnover
Employee Net Promoter Score (NPS) essentially measures how likely an employee is to advocate for the organization to other potential employees.
NPS gauges if an employee would recommend working for the company to family members or friends on a scale of 0-10. Employees that score 0-6 are considered detractors, and employees that score 9 or 10 are promoters.
The score is then calculated as:
Employee absenteeism measures how often employees were absent from work over a given time. Depending on the percentage, the metrics can be a fast indicator of employee disengagement that company leaders should address quickly.
Absenteeism is calculated as:
Finally, employee turnover is the primary metric for measuring employee engagement. If turnover is high, it’s assumed team members do not have what they need to feel satisfied or motivated to remain loyal to the organization.
Turnover is gauged as:
BONUS: Employee engagement can also be measured directly through an employee collaboration platform, like Beekeeper. For example, managers can view the percentage of employees that have opened corporate messages and track read receipts.
More on this in a bit!
Internal Communication Analytics
Effective internal communication is one of the most influential factors in the employee experience. Through internal communications, employees are:
- Connected, informed, and engaged with corporate news and information
- Aligned with the organization’s mission, vision, and goals
- Empowered with the tools they need to do their jobs successfully
Given its significance, organizations work diligently to craft internal communication strategies best fit for their workforce. For instance, if most of a business’s employee base is on the front line, it will likely distribute digestible information through a mobile collaboration platform.
A crucial step in any internal communication strategy is measurement. Otherwise, how else will you know what sticks and what doesn’t?
Standard internal communication metrics include:
- Employee adoption rate
- Open rate
- Click-through rate
Employee adoption rates measure employee engagement on a specific platform to receive internal communications. The adoption rate calculation is:
Open rates track how often employees are opening internal communications, either through a communication platform or email. Open rates are calculated as:
Click-through rates take employee engagement one step further than open rates. With click-through rates, organizations can see how many employees clicked a link within your communication.
The click-through rate equation is:
Training Efficiency Analytics
Employee training and development are essential workplace programs proven to boost employee engagement and productivity.
But, like employee benefits, employee training and development can be costly. Which is why most organizations want to gauge the effectiveness of employee training programs.
Examples of training efficiency metrics include:
- Completion rates
- Post-training performance assessments
- Return on investment (ROI)
Completion rates capture how successful employees are in completing a particular training. For example, it’s likely the training is not very effective if most employees either fail or have to retake a course multiple times to pass.
Post-training performance assessments evaluate the employee’s ability to retain and practice the concepts learned in their training program. Post-training assessments should be conducted after the employee has had the opportunity to test their knowledge. Say, two-to-three months after the training.
ROI tracks the returns gained against the costs incurred for a particular training program. By measuring ROI, managers can better weigh a program’s beneficial impact on the organization. For example, if a costly program translates to enhanced employee output, it may be worth the investment.
Onboarding Speed Analytics
Onboarding is one of the first steps of the employee experience. And, if done right, it sets the tone for the remainder of their time with the company.
Successful onboarding can boost employee performance by 15%.
A strong employee onboarding program leads to:
- Elevated employee satisfaction
- Decreased employee turnover
- More productive employee performance
- Faster organizational contributions
The most important onboarding speed metric is calculating time to productivity. Time to productivity tracks how long it takes a new employee to contribute to the organization.
Time to productivity measurements should be set by the organization to match its culture and expectations. Some organizations track employee time to productivity through regular manager check-ins during the employee’s first few months.
Efficiency and Productivity Analytics
Employee productivity and efficiency are tell-tale signs of how engaged an employee is at the workplace. Why? Because operationally efficient employees usually:
- Have access to essential job-related information
- Are aligned on overall objectives
- Retained tactics and techniques learning in training
- Are empowered to make decisions to improve workplace processes and practices
Top operational efficiency and productivity metrics include:
- Work efficiency
- Work quality
- Time spent on certain tasks
Work efficiency measures the employee’s overall ability to get work done. Work efficiency can be determined by assessing an input-output ratio of a particular task over a designated time frame.
Work quality is tracked through manager feedback that details the employee’s work quality performance. Work quality can easily indicate if the employee has the tools, drive, and knowledge base to complete a task in alignment with expectations.
Time spent on certain tasks is a straightforward productivity metric that captures how long it takes an employee to complete an assignment. Employees that continuously take too long to finish their projects are likely less motivated to perform to the best of their ability.
Tracking time spent on work-related tasks is not always reflective of the employee’s abilities. For example, employees spending hours looking for information indicates the business may not be using the right communication platform.
The Ethics of Data Analytics and Employee Experience
Did you know that more than 3.5 billion people have had personal data stolen because of company data breaches? That’s just under half of the entire world population as of July 2020.
So, it’s no surprise that the rise in workplace tools has many questioning the ethics of data analytics and employee experience.
These days, businesses have more access to personal employee data than ever before. Employers can collect information through employee records, email, and platform usage.
But, do you know what your organization uses that data for? For starters, they can use it to measure the employee analytics we’ve been discussing. Which is why employers must adopt workplace tools that have best-in-class security measures, such as:
- Full data encryption
- Regulatory compliance, including GDPR and ISO 27001 certification
- Advanced firewall protection
- Regular security audits
Additionally, Harvard Business Review suggests companies should adopt charters for ethical employee analytics practices.
These charters will:
- Clearly outline what the company can and cannot do with employee data
- Builds trust with employees by transparently sharing how their data is being used
- Supports an open and honest workplace culture
Ultimately, advanced analytics leverage employee data – whether the employee is aware or not. Companies should take proactive measures to ensure their employees know how their data is both protected and used.
Selecting The Right Tool For Measuring Employee Analytics
As you can see, there are several ways organizations can track employee analytics. Whether it be employee attrition, benefits, or engagement analytics, leaders should use this information to create more productive workplace experiences.
However, tracking these valuable metrics can be close to impossible without the right tool. Workforce collaboration platforms, like Beekeeper, are built to optimize practices with rich data and analytics.
With Beekeeper’s Analytics Dashboard, companies can securely track:
- Overall active users on the platform
- Percentages of employees that opened a communication
- User engagement and behavior
- Percentages of employees that have confirmed they’ve read a company message
- Employee survey responses
Additionally, using the right tool for measuring employee analytics can increase employee engagement by:
- Leveraging data to ensure the right person in the right position
- Communicating through easy-to-use mobile technology your workforce is familiar with
- Creating a culture that values transparency, knowledge-sharing, and collaboration
- Making it easier to build relationships with other employees
- Sharing important information that makes employees feel trusted and valued
For more data-driven trends impacting the industry, check out our “2021 HR Trends That Will Shape the Future of Frontline Work”!
Most Frequently Asked Questions
What Are Employee Analytics?
According to Gartner, employee analytics provide organizations with a real-time snapshot of the employee experience. Businesses can then use that data to make improvements when and where needed.
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