Executive Insider

Banking on Data to Drive Human Capital Decisions Can Have Significant Impact on Long-Term Company Performance

Matthew Spencer

Data, automation, and artificial intelligence all have the power to deliver meaningful insights to executives and HR teams who know how to effectively extract them. Beyond helping a company hire the right people, data can dramatically influence many other areas of human capital in a business. Executives should empower their employees to leverage data in creative ways, and HR professionals should embrace the fact that their job is becoming less administrative and more strategic and data-driven. While technology is not a replacement to the traditionally human-led work of HR teams, it can serve as an accelerant that will help them accomplish long sought-after goals.

What tasks can data help teams achieve? How can artificial intelligence work in unison with historically person-to-person work? Where can automation help HR teams save time and allow their talents to shine?

Find the best candidates for your company’s culture and working style 

A good first step in collecting relevant data on your company’s human capital is to introduce job analyses and assessments. Job analyses will allow you to understand exactly what each job requires of the person in it. For example, doing the job of a software engineer requires different cognitive skills and personality traits than the role of someone on your sales team. You can then build assessments based off of those job analyses, which will allow you to understand what combination of traits and skills your high-performing employees share.

Administering these assessments will allow you to understand, with a high degree of predictability, how candidates may perform in the given job and within your company culture. Pre-employment assessments have a decades long history and track record, and are becoming more commonplace as companies focus on replacing intuition with data-driven talent decisions. There are many companies that are able to develop these tools for you, offering choices between standalone industrial-organizational psychology-based assessments and more technology-enabled assessment platforms.

Expand your recruiting reach, but narrow your recruiting funnel 

A.I. is more accessible than ever, and can help your teams sort through an infinite amount of resumes or applications to uncover candidates you may not have historically considered. Many companies who have a large number of applicants often, and understandably, use arbitrary shortcuts in order to avoid reading every resume that comes through. Some use GPA, university, or years of experience to determine who gets a shot at a phone screen. But A.I. can look for clues beneath the surface and ultimately expand who your team is able to consider, while simultaneously excluding candidates who do not meet certain criteria, saving time on screening or even interviewing the wrong people.

Mitigate bias throughout the employee lifecycle 

The reason so many recruiters and human capital executives normally “trust their gut” when making hiring decisions is because they don’t have anything else to rely on. However, implicit and “like-me” bias often work against certain demographics, resulting in racial and gender disparities in who gets hired. Using relevant, predictive data and A.I. that is properly tested for adverse impact can appropriately mitigate these biases and create a more equitable experience for all. It also enables companies to efficiently expand their reach and hiring criteria to consider a wider range of candidates, thereby creating more representative hiring pipelines.

Bias and adverse impact goes well beyond the hiring process. Unintended bias can be prevalent in work assignments, mentorship, performance reviews, promotions, compensation decisions, and terminations. Using data to identify, understand, and then mitigate bias throughout the employee life cycle is critical to building healthy, diverse, high-performing organizations.

Develop current employees and reduce retention 

If you are able to put your company through a comprehensive assessment program, you will have insights that can be deployed beyond recruiting. This valuable data will give you access to previously undiscovered or unquantified information about your current employee base, and you can use that information to identify individual strengths and weaknesses. By identifying certain traits and skills that are possessed by top performers, but that some lower performers lack, you can provide concrete and custom development plans to help upskill underperformers. This information can then be used to nurture employees who show potential, which may be especially useful in building a high-performing, diverse pipeline of future leaders.

Ultimately, a rich human capital data set can provide companies opportunities to impact important areas such as internal mobility, performance management, professional development, attrition prediction and mitigation, and diversity, equity, and inclusion, among others.

Obtaining, training, and retaining top talent can provide the edge that most companies need, especially in highly-competitive markets. Successes and failures result from business decisions, some small and some mission critical. Those decisions are made by people. So, ask yourself, “How well do I understand what makes a person a top performer in my organization?” and “Am I doing everything I can to ensure we have the best people making the best decisions?”

The world is moving quicker, changing faster, and competing more fiercely due to advances in data and technology. So, fight fire with fire and harness the power of data and technology to impact the most valuable asset you have, your people.

Commentary by Matthew Spencer. Here’s what you’ve missed?
World’s Best Countries For Cultural Influence.
World’s Best Countries For Entrepreneurship.
World’s Trendiest Countries.
World’s Best Countries For Investment In E-commerce And Digital Sector.

Track Latest News Live on CEOWORLD magazine and get news updates from the United States and around the world. The views expressed are those of the author and are not necessarily those of the CEOWORLD magazine.
Follow CEOWORLD magazine headlines on Google News, Twitter, and Facebook. For media queries, please contact: info@ceoworld.biz
Matthew Spencer
Matthew Spencer is the Co-founder, CEO and Chairman of the Board of Suited, Inc, an A.I.-powered, assessment-driven recruiting network designed to help companies make a tangible strategic impact to the performance of the organization by identifying the most promising candidates from all backgrounds. A former Chief Human Capital officer at Houlihan Lokey, Inc. (NYSE:HLI), he was responsible for overseeing all of the talent management strategies globally for the firm. Matthew Spencer is an opinion columnist for the CEOWORLD magazine. Follow him on LinkedIn.