People analytics is the future of recruitment
When companies and the job seeker pool were smaller, hiring personnel could afford to take some time getting to know candidates, making sure that a position went to the right person on paper and in person.
But how accurately were these candidates chosen? Did hiring decisions translate into a strong return on investment in an employee? Through people analytics, hiring managers can prepare for the future of recruitment by hiring job seekers based on proven data trends, ensuring high retention for new workers.
The cost of employee turnover
Australia’s average turnover rate is higher than the rates for Germany, the United Kingdom, India, Brazil and the United States.
According to research by Mercer, the average turnover rate nationwide is approximately 16 per cent, higher than the rates for Germany, the United Kingdom, India, Brazil and the United States.
When an employee leaves a position before the company has recouped the amount it spent training that worker, the company loses money. While changes in the workplace can help reduce turnover, a much more effective solution is to make sure the right candidates are being hired in the first place – after all, an ounce of prevention is worth a pound of cure.
By hiring the right candidate for a job, Australian companies can work towards higher retention and avoid the financial loss of high turnover.
How can people analytics influence hiring decisions?
People analytics, a field of big data that focuses on analysing the massive amounts of information available about an individual, can match evidence-based traits of ideal workers with profiles of available candidates to determine who has the highest potential at a company. Rather than traditional hiring methods where HR personnel must rely on information a candidate explicitly provides or on a sense of intuition that a candidate is right for the job, people analytics brings a sense of objectivity to an otherwise subjective task.
— Umbel (@Umbel) December 10, 2014
The example of Xerox is a testament to the power of big data and people analytics in recruitment. In partnership with Cornerstone OnDemand, Xerox was able to cut its employee attrition by 20 per cent over a six-month period. Candidates for call centre were run through a battery of tests designed to find those with personality and character traits that indicate a higher potential for success in that working environment.
People analytics, along with a comprehensive suite of recruitment software, can help companies make the most out of their hiring process by finding the candidates who have the highest potential for long-term success.
For your comprehensive guide on how to pick the best recruitment software your business, click here.