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SPHRi Functional Area 05

HR INFORMATION
MANAGEMENT, SAFETY, AND
SECURITY

International Human Resource Certification Institute

IHRCI
IHRCI ©
© www.ihrci.org
www.ihrci.org
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Senior Professional in Human Resources – International (SPHRi) Workbook

Module Five: HR Information Management, Safety, and Security

2024 Edition

Copyright © 2024 by International Human Resource Certification Institute

All rights reserved. No part of this book may be reproduced, stored in a retrieval
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assumed for damages resulting from using the information contained herein.

International Human Resource Certification Institute (IHRCI)

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Hong Kong

www.ihrci.org

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Introduction

As a subscriber of the SPHRi certification workbook series, you have access to the
www.ihrci.org learning system. The system includes a Glossary that provides a search box
and descriptions of key HR terms. Additionally, the system consists of over 900 practice exam
questions and answers with explanations in our database, including pre-tests, review tests,
and post-tests:

Pre-test: It contains the same percentage of questions from each content area. Participants
can take a pre-test of that module to assess their conceptual understanding of that specific
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percentage and the number and percentage of questions answered correctly are provided.
Answers with explanations for individual questions are also provided. Our system allows
users to save the pre-test results for later improvement.

Review-test: Every review test contains questions with explanations that help you
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Once you finish reviewing one section of the workbook text, you naturally gain access to the
next section. Each new section builds on the concepts learned in the previous knowledge
areas. Please follow a step-wise study approach for all the knowledge areas.

Post-test: Once you have completed all the knowledge areas, take a full-length simulated
practice test under the same testing conditions as the actual exams. The test, which covers
140 questions over 3.25 hours, is designed to help you familiarize yourself with the final
SPHRi Exam format and question types. Continue practicing until you consistently achieve
near 80% correct answers in the post-test. This will help you understand the areas where you
have improved since the last test and identify topics that require further revision.

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This workbook is not a textbook. The included workbooks and practice exams are intended
to aid in preparation for the SPHRi Certification Exam conducted by the HR Certification
Institute. By using all of the preparation materials, you will become well-versed in the four
key functional areas that make up the HR Certification Institute’s SPHRi body of knowledge.
However, studying these materials does not guarantee that you will pass the exam. These
workbooks should not be considered legal or professional advice.
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Table of Contents
Introduction ................................................................................................................................ 3
Table of Contents........................................................................................................................ 4
Part One: HR Digitalization ......................................................................................................... 6
1. HR Data Analytics ........................................................................................................... 6
1.1. The Data Information Knowledge Wisdom (DIKW) Pyramid .............................. 6
1.2. Type of Data......................................................................................................... 8
1.3. Sources of Data.................................................................................................. 10
1.4. Integration of Data ............................................................................................ 14
1.5. Analytics of Data................................................................................................ 17
2. Essentials of Statistics ................................................................................................... 22
2.1. Mean ................................................................................................................. 22
2.2. Median .............................................................................................................. 22
2.3. Mode ................................................................................................................. 22
2.4. Range ................................................................................................................. 23
2.5. Percentile ........................................................................................................... 23
2.6. Quartiles ............................................................................................................ 23
2.7. Probability ......................................................................................................... 23
2.8. Statistical Power ................................................................................................ 23
2.9. Standard Deviation (SD) .................................................................................... 23
2.10. Reliability and Validity ..................................................................................... 23
3. Human Resource Information System .......................................................................... 26
3.1. Functions of HRIS .............................................................................................. 27
3.2. Benefits of Investing HRIS.................................................................................. 29
3.3. In-House vs. Outsourced HRIS ........................................................................... 30
3.4. Cloud based vs. On-Premises HRIS .................................................................... 32
3.5. Implementation of HRIS .................................................................................... 33
3.6. Evaluation of HRIS ............................................................................................. 36
3.7. Challenges of Implementing HRIS ..................................................................... 37
4. Artificial Intelligence Applications in HR ...................................................................... 39
4.1. The Benefits of AI in HR ..................................................................................... 40
4.2. The Practices for using AI in HR ......................................................................... 41
4.3. Challenges of AI in HR ....................................................................................... 44
5. HR Digital Transformation ............................................................................................ 44
5.1. Business as usual (BAU) ..................................................................................... 45
5.2. Present and Active............................................................................................. 45
5.3. Formalized ......................................................................................................... 45
5.4. Strategic ............................................................................................................. 46

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5.5. Converged.......................................................................................................... 46
5.6. Innovative and Adaptive.................................................................................... 46
Part One: Safety and Security................................................................................................... 47
1. Employee Safety ........................................................................................................... 47
1.1. Importance of Employee Safety ........................................................................ 47
1.2. Scope of Employee Safety ................................................................................. 48
1.3. Objectives of Employee Safety .......................................................................... 49
1.4. Implementation of Safety Programs ................................................................. 51
1.5. Roles and Responsibilities ................................................................................. 52
1.6. Design for Safety Workplace ............................................................................. 53
1.7. Accident investigation ....................................................................................... 54
2. Workplace Security....................................................................................................... 55
2.1. Importance of Workplace Security .................................................................... 56
2.2. Practices of Workplace Security ........................................................................ 57
2.3. Measures of Workplace Security....................................................................... 62
2.4. Technological advancements in security ........................................................... 62
3. Employee Return to Work ............................................................................................ 64
3.1. Gathering Details and Assessing the Situation .................................................. 64
3.2. Consulting Health and Medical Specialists........................................................ 65
3.3. Consulting Union Representatives (When Necessary) ...................................... 65
3.4. Reviewing Accommodation Options ................................................................. 65
3.5. Implementing Accommodation Measures ........................................................ 65
4. Data Privacy and Security ............................................................................................. 66
4.1. Data Ownership ................................................................................................. 66
4.2. Data Portability .................................................................................................. 67
4.3. Data Access Control ........................................................................................... 67
4.4. Vigilant Compliance ........................................................................................... 68
4.5. Complete Security Support ............................................................................... 69
Reference.................................................................................................................................. 70
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Part One: HR Digitalization

1. HR Data Analytics

HR analytics, or people analytics, is a powerful tool that can help organizations make
better HR decisions. HR analytics plays a pivotal role in HR digitalization, offering data-
driven insights that enable HR teams to enhance decision-making and streamline HR
processes. Specifically, HR analytics empowers HR teams to boost efficiency by automating
tasks like recruitment, performance management, and compensation management,
thereby freeing up time for strategic endeavors. Moreover, it aids in informed decision-
making, allowing HR teams to allocate resources effectively, enhance employee
performance, and reduce costs, exemplified by the analysis of turnover data to identify
and mitigate turnover causes. Furthermore, HR analytics fosters an enriched employee
experience by comprehending employee needs and expectations, leading to
improvements in areas of low satisfaction based on employee satisfaction data analysis. In
conclusion, HR analytics stands as a vital element of HR digitalization, contributing to
increased efficiency, informed decision-making, and an enhanced employee experience,
ultimately delivering greater value to the organization.

Data is the foundation of HR analytics. Without data, HR professionals cannot make

informed decisions or identify trends and patterns. There are many different types of data
that can be used for HR analytics, including employee demographics, performance
metrics, attendance records, compensation data, and benefits usage. By embracing the
power of data, organizations can use HR analytics to create a thriving workplace where
every employee flourishes.

1.1. The Data Information Knowledge Wisdom (DIKW) Pyramid

1.1.1. Data

Data is the raw, unprocessed, and often unstructured information collected from
various sources.

Example: In HR analytics, data can include employee names, job titles, salaries,
performance scores, and attendance records.

Transition to Information: To move from data to information, context is required to

understand what the data represents. For instance, understanding that a "salary" field
represents annual compensation and "attendance records" are daily check-in/out
times.
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1.1.2. Information

Information is organized and processed data that provides context and answers
specific questions or addresses particular issues.

Example: HR information could include monthly turnover rates, department-wise

performance metrics, or gender diversity statistics.

Transition to Knowledge: To progress from information to knowledge, you need to

attribute meaning to the information. For example, understanding that a high
turnover rate in a particular department may indicate a problem with management or
work conditions.

1.1.3. Knowledge

Knowledge is the application of information to make informed decisions or to

understand how and why things work.

Example: HR knowledge might involve recognizing that employee satisfaction surveys

indicate a correlation between flexible work hours and higher job satisfaction.

Transition to Wisdom: Transforming knowledge into wisdom requires insight, which

means understanding the underlying principles, patterns, and trends. For instance,
recognizing that a flexible work culture aligns with the company's values and leads to
long-term employee retention and productivity gains.

1.1.3. Wisdom

Wisdom is the highest level of the pyramid, representing the ability to make sound
judgments and strategic decisions based on accumulated knowledge and experience.

Example: In HR analytics, wisdom might involve crafting a long-term talent acquisition

strategy that factors in changing demographic trends, evolving job market dynamics,
and organizational goals.

Tn the process of translating wisdom into informed decision-making, HR's impact is

pivotal as it serves as a critical bridge between accumulated organizational knowledge
and effective decision-making. By leveraging HR analytics, talent management
strategies, and data-driven insights, HR professionals can provide decision-makers
with a comprehensive understanding of workforce dynamics, employee engagement,
skill gaps, and performance trends. This proactive approach not only reduces decision-
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making risks but also enhances the alignment of strategic choices with the
organization's human capital, leading to more informed, targeted, and ultimately
successful decisions that drive sustainable growth and mitigate potential pitfalls.

Source: Maciel (2023)

1.2. Type of Data

From an HR analytics perspective, data can be categorized into different types based
on its nature and characteristics, including qualitative data (which includes nominal
and ordinal data) and quantitative data (which includes discrete and continuous data).

1.2.1 Qualitative Data

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Nominal Data: Nominal data represents categories or labels with no inherent order or
ranking. In HR analytics, this can include data related to employee attributes that
don't have a natural order. It cannot be compared in terms of magnitude, added,
subtracted, multiplied, or divided.

Example: Employee gender (Male, Female, Other), Employee departments (HR,

Finance, Marketing).

Ordinal Data: Ordinal data represents categories with a meaningful order or ranking,
but the differences between categories are not uniformly defined. In HR analytics, this
often involves subjective assessments or rankings. It can be compared in terms of
magnitude but cannot be added, subtracted, multiplied, or divided.

Example: Education level (Doctorate, Master, Bachelor, Associate, High School),

Employee Performance Ranking (1st, 2nd, 3rd, ...) - The ranking order is meaningful,
but the difference between ranks may not be consistent.

1.2.2 Quantitative Data

Discrete Data: Discrete data consists of whole numbers that represent distinct,
countable values. In HR analytics, this type of data often involves quantifiable events
or counts. in terms of magnitude and added or subtracted, but multiplication or
division may not be meaningful in all cases.

Example: Questionnaire Responses (1, 2, 3, 4, 5) - You can compare the responses in

terms of magnitude (e.g., 5 is greater than 3) and add them (e.g., sum of Likert
scores), but multiplying or dividing them may not make sense in the context of these
responses.

Continuous Data: Continuous data represents values that can take any real number
within a given range. It is characterized by the possibility of infinite values within the
range. It can be compared in terms of magnitude and can be added, subtracted,
multiplied, or divided.

Example: Employee age (28.5, 30, 35.2, ...), Years of work experience (3.7, 7, 12.1, ...),
Employee salaries ($50,000, $60,000, $100,000, ...).

HR departments rely on both qualitative and quantitative research to gather essential

information for various HR functions. Quantitative data helps determine salary
benchmarks, assess health benefit costs, and analyze employee and management
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surveys, providing objective insights into workplace trends and areas for
improvement. This data is crucial for maintaining competitive compensation and
benefits, presenting recommendations to executive management, identifying hiring
trends, and building candidate demographics. On the other hand, qualitative research
aims to understand stakeholder perspectives and firsthand experiences, providing
valuable insights into personnel issues and morale problems. Combining both
approaches enhances research validity, addresses internal validity threats, and offers
a comprehensive understanding of complex HR topics and situations. Qualitative data
offers diverse viewpoints, while quantitative data provides precise and objective
information, making them complementary tools for effective HR research.

Comparing Qualitative and Quantitative Research

Qualitative Research Research Aspect Quantitative Research

Discover Ideas, with Test Hypotheses or Specific
Common Purpose
General Research Objects Research Questions
Observe and Interpret Approach Measure and Test
Structured Response
Unstructured. Free Form Data Collection Approach
Categories Provided
Research is intimately Researcher uninvolved
involved. Results are Researcher Independence Observer. Results are
subjective Objective
Large samples to Produce
Small samples-Often in Generalizable Results
Samples
Natural setting [Results that Apply to Other
Situations

Source: Othman (2014)

1.3. Sources of Data

Obtaining HR data involves collecting information about various aspects of human

resources within an organization. Data can be sourced from both primary and
secondary methods, each with its own set of techniques and sources:

1.3.1. Primary Data Collection Methods

Surveys: Designing and administering surveys to employees, managers, or other

stakeholders is a common method to collect quantitative and qualitative HR data.
Surveys can cover topics like employee engagement, satisfaction, or training needs.

Interviewing: Conducting structured or semi-structured interviews with employees,

HR personnel, or managers can provide valuable insights. For instance, HR
professionals may interview employees to gather feedback on workplace culture or
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job satisfaction.

Focus Groups: Organizing focus group discussions with a select group of employees
can help capture qualitative data on specific HR-related topics, such as diversity and
inclusion or training program effectiveness.

Observation: This involves directly observing and recording HR-related activities or

behaviors within the organization. For example, an HR analyst may observe employee
interactions during onboarding sessions or performance reviews to gather data on
communication patterns or engagement levels.

Content Analysis: Analyzing HR-related documents, such as company policies, emails,

or performance reports, can yield valuable data. Content analysis can be used to
identify trends, compliance issues, or communication patterns within the
organization.

1.3.2. Secondary Data Sources

HRIS Data: Human Resource Information Systems (HRIS) store a wealth of HR-related
data, including employee records, payroll information, attendance logs, and
performance appraisals. HRIS data can be used for various HR analytics purposes, such
as workforce planning and talent management.

Other HR Data: Besides HRIS, other HR-specific databases or systems may contain
relevant data. This includes employee training databases, benefits enrollment records,
or records of workplace incidents and accidents.

Business Data: HR data can also be sourced from broader business databases and
systems (e.g. ERP, CRM). For example, financial data may provide insights into
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compensation trends, while customer satisfaction data may indirectly reflect

employee engagement levels.

External Benchmarks: Organizations often use external benchmarking data from

industry surveys or reports to compare their HR metrics (e.g., turnover rates,
compensation levels) with industry norms.

Government Data: Data from government agencies or industry-specific regulatory

bodies may provide information on labor laws, compliance, and workforce
demographics.

1.3.3. Common HR data sources for analytics

Secondary data is widely applied in HR analytics primarily due to its accessibility,

efficiency, and reliability. HR departments maintain extensive records and databases
containing historical data related to employee demographics, performance,
compensation, and more, which serve as valuable resources for HR analysts without
requiring extensive data collection efforts.

Source: van Vulpen (2023)

This historical data allows for retrospective analysis, trend tracking, and benchmarking
against industry norms. Moreover, secondary data is consistent, reliable, and scalable,
making it suitable for organizations of all sizes. Its data consistency and
comprehensive insights across various HR functions enable organizations to make
data-driven decisions, optimize workforce management, and enhance HR strategies
efficiently and effectively, while also maintaining compliance with data privacy
regulations. The following is a compilation of commonly utilized data sources in HR
and the wider business realm that can be beneficial for their efforts in the field of

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people analytics.

HRIS Data Sources

The organization's HRIS encompasses a plethora of data related to fundamental HR

functions such as recruitment, performance management, and talent management.
While the specific modules within an HRIS may vary from one company to another,
there are typically common modules that house data crucial for people analytics. For
instance, recruiting data sourced from the Applicant Tracking System (ATS) serves as a
primary data source, encompassing candidate application statistics, CVs, recruitment
funnel details, source analytics, and selection data. Demographic data derived from
HRIS employee records, including employee ID, gender, date of birth, position,
department, and more, often functions as control variables in analyses and serves as a
central point for data enrichment. Performance management systems (PMS) store
employee reviews and performance ratings, while the learning management system
(LMS) contains information about courses and employee progress. Additionally, job
architecture, compensation, succession planning, talent development, and exit
interview data are also available within the HRIS, offering comprehensive insights into
HR functions.

Other HR Data

In contrast, other HR data sources encompass HR-related information that typically

doesn't reside within the HRIS, mainly due to challenges in data collection using
standard methods. Learning data, learning program evaluation data, travel data,
mentoring data, employee survey data, engagement survey data, absence data,
wellbeing and wellness program data, social network data, and various other HR-
specific datasets fall into this category. These datasets often require separate
collection and storage methods, including surveys, external data sources, and
decentralized data collection systems, and they contribute to a more holistic
understanding of HR dynamics.

Business Data

In addition to HR data, a myriad of business data sources can be harnessed for people
analytics purposes. These include Customer Relationship Management (CRM) data,
which offers insights into customer interactions and satisfaction, financial data for cost
and return-on-investment (ROI) analyses, production management data for tracking
productivity and service delivery, and sales data to measure the effectiveness of HR
policies affecting customer-facing employees. Furthermore, both internal business
data and external sources, such as market data, weather data, and other external
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factors influencing people and productivity, can play crucial roles in enriching people
analytics endeavors.

1.4. Integration of Data

The following diagram provides a comprehensive overview of the data processing and
analysis flow frequently employed in HR analytics, especially when building an
integrated HR data warehouse. Let's delve into each element and acronym for a
detailed explanation, along with illustrative examples:

Source: ScienceSoft (2023)

1.4.1. Data Source

These initial data sources for HR analytics include various HR databases, such as
Talent Management Systems (TMS), Human Resource Information Systems (HRIS),
Applicant Tracking Systems (ATS), and other HR software. These HR databases capture
a wide array of employee-related data, including but not limited to employee records,
recruitment metrics, performance evaluations, payroll information, and benefits
details. These databases serve as the foundational data sources for HR analytics,
providing the raw material from which insights are extracted. For instance, the HRIS
contains employee records, including demographic data like employee ID, name,
gender, and position, while the ATS records applicant data, such as resumes and
application status. These HR databases are where the data journey begins in the realm
of HR analytics.

A database is a structured and organized collection of data that is stored electronically

in a computer system. It consists of tables, records, fields, and relationships that allow
for efficient data retrieval, storage, and management. Databases serve as repositories
for storing, accessing, and manipulating data in a systematic and structured manner.

The relationship between a database and data is that a database is the container or
framework where data is stored, organized, and managed. Data, on the other hand,
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refers to the actual information or facts that are stored within the database. In
essence, data is the content or information, while the database is the infrastructure
that stores and facilitates the management of that data. Databases provide the
structure and mechanisms for efficiently storing, retrieving, and manipulating data to
support various applications and processes.

1.4.2. Data Transformation

This pivotal step involves refining raw data from diverse sources to ensure consistency
and standardized formatting for subsequent analysis. It encompasses tasks like
cleaning, normalizing, and converting data. For instance, when merging data from
different HRIS systems, data transformation may involve aligning job titles to a
standardized classification. Likewise, it might entail converting various date formats
into a uniform standard, facilitating cross-system compatibility.

1.4.3. Data Warehouse (DWH)

A Data Warehouse serves as a centralized repository for the transformed HR data,

accommodating information from multiple sources. It is optimized for efficient
querying and analysis, rather than transactional processing. The data warehouse
houses historical data, derived from transactional records as well as other data
sources, which is essential for historical trend analysis and reporting. For example, an
HR data warehouse might store years of employee records, performance reviews, and
recruitment data.

1.4.4. Extract, Transform, Load (ETL)

ETL is a systematic process responsible for extracting data from various sources,
transforming it to meet operational requirements (including data quality checks), and
loading it into the Data Warehouse. This process often involves tasks like aggregating
data, establishing relationships among datasets, and partitioning data into specialized
subsets or data marts for focused analysis. An example of ETL in HR analytics could be
extracting employee performance data from HRIS, transforming it into a standardized
format, and loading it into the HR data warehouse.

1.4.5. Data Mart

Data marts are specialized segments within the data warehouse, catering to specific
business lines or functions. In HR analytics, they may include subsets of data tailored
for particular purposes like performance management, recruitment analytics, or
benefits administration. For instance, an HR data mart might store only employee
performance data for analysis, simplifying access and analysis for HR professionals
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focused on performance metrics.

1.4.6. OLAP Tools (Online Analytical Processing)

These tools facilitate complex analytical queries with swift execution times. They
empower HR professionals to analyze data from multiple database systems
simultaneously, often featuring multi-dimensional data analysis capabilities. An
example could involve using OLAP tools to explore employee turnover trends over
time, allowing HR analysts to drill down into various dimensions like department,
tenure, and location.

1.4.7. Reporting Tools

Reporting tools are employed to create visually appealing reports and dashboards for
data visualization and interpretation. In HR analytics, they play a crucial role in
generating reports that provide insights into key metrics such as attrition rates,
diversity statistics, or training effectiveness. For instance, HR professionals may use
reporting tools to visualize employee engagement survey results, enabling them to
identify trends and areas for improvement.

1.4.8. Data Mining Tools

Data mining tools are instrumental in uncovering hidden patterns and relationships
within large datasets. In HR, these tools can be leveraged to predict employee
turnover, identify factors contributing to job satisfaction, and forecast workforce
trends. An illustrative example might involve using data mining to analyze historical
employee data and predict future attrition risks based on various attributes and
historical patterns.

In summary, the data flow depicted in this diagram, from data sources to actionable
insights through the utilization of various tools and processes, empowers HR
professionals to make informed strategic decisions rooted in comprehensive data
analysis. This integrated approach to HR information management and analysis
enhances HR's ability to drive organizational success and talent management
effectively.

1.4.9. Business intelligence (BI)

Business Intelligence (BI) is a comprehensive set of technologies, processes, and tools

that enable organizations to collect, transform, and analyze data, converting it into
valuable insights for informed decision-making. BI encompasses a range of activities,
including data integration, data warehousing, data visualization, and data analysis,
with the ultimate goal of helping businesses gain a deeper understanding of their
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operations, customers, and markets. OLAP Tools, Reporting Tools, and Data Mining
Tools are specialized components within the BI ecosystem that contribute to various
aspects of data analysis, visualization, and interpretation, enhancing the overall
effectiveness of BI initiatives. Essentially, BI systems retrieve specified data from
multiple databases, including old legacy file database systems, and store these data in
a new database, which becomes that data warehouse. The data in the data
warehouse can then be accessed via queries and used to uncover patterns and
diagnose problems.

1.5. Analytics of Data

Analytics is the process of utilizing various methods to manipulate and combine

metrics, which are quantifiable measurements based on one or more data elements,
to gain valuable insights. These insights aid in problem-solving and decision-making by
providing a deeper understanding of the data presented. Measures, on the other
hand, represent individual numerical values obtained through direct measurement,
such as height, weight, or temperature. Metrics, in essence, are calculations or
comparisons involving two or more measures, typically through division, resulting in
percentages, ratios, fractions, decimals, or multiples. The interrelationship lies in the
fact that analytics involves the examination and manipulation of metrics, while metrics
themselves are derived from individual measures to provide meaningful information
within a given context.

HR analytics, also commonly referred to as people analytics, workforce analytics, or

talent analytics, represents the practice of gathering, analyzing, and reporting HR data.
Its primary objective is to empower organizations to measure the impact of various HR
metrics on overall business performance and facilitate data-driven decision-making in
the realm of Human Resources Management. In essence, HR analytics is a systematic,
data-oriented approach to managing human resources. These are the key components
and types of HR analytics:

1.5.1. Descriptive Analytics

Descriptive analytics serves as the foundational level of HR analytics. It involves

analyzing historical data patterns to gain insights into past events and trends. This type
of analytics, often referred to as decision analytics, employs statistical techniques to
summarize and explain historical data, shedding light on what has occurred without
making predictions for the future. Descriptive analytics leverages both numerical and
qualitative data, including calculations like central tendency, variation, ranking, and
more. It is particularly useful for assessing behavior, comparing characteristics over
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time, identifying anomalies, and recognizing strengths and weaknesses. Examples of

descriptive analytics include analyzing the average number of paid time off days used
by employees (PTO) or examining employee turnover rates between different
departments.

1.5.2. Diagnostic Analytics

Building upon descriptive analytics, diagnostic analytics aims to provide explanations

for the insights uncovered. It delves into the "why" behind the data's trends,
correlations, and anomalies by identifying contributing factors. Diagnostic analytics
involves a multi-step process, including pattern identification, data exploration, and
causal relationship analysis. Various techniques, such as data drilling, data mining,
probability theory, regression analysis, and statistical analysis, are employed to
uncover causal connections within the data. Its purpose is to transform data into
actionable insights, allowing HR professionals to grasp the bigger picture and identify
potential issues. Diagnostic analytics use cases include analyzing employee
absenteeism to understand why employees are missing work more often and
improving employee engagement by identifying factors that influence job satisfaction.

1.5.3. Predictive Analytics

Predictive analytics involves forecasting future outcomes by categorizing past and

present data to identify patterns and correlations. It estimates models to predict
future events and evaluates model accuracy using new data. In HR, predictive analytics
translates historical data on job skills, employee engagement, productivity, resumes,
and more into forecasts about future events. These predictions enable HR leaders to
make informed decisions in areas such as recruitment, skill gap bridging, and talent
retention. Examples of predictive analytics include using data from the hiring process
to identify desired skill sets in candidates or estimating future demand for specific
roles to optimize recruitment strategies.

1.5.4. Prescriptive Analytics

Prescriptive analytics represents the most advanced stage of analytics, transforming

predictive insights into actionable recommendations. It offers decision options and
actions based on predictive analytics findings, utilizing advanced technologies like
machine learning, algorithms, artificial intelligence, and pattern recognition.
Prescriptive analytics anticipates likely future scenarios and suggests interventions to
achieve optimal results. In an HR context, prescriptive analytics can assist in preparing
for staffing needs by analyzing employees' interactions with digital benefit options or

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addressing attrition by tracking interventions and their impact. For instance, it can
suggest changes in team structures, offer additional training, and assess their
effectiveness in retaining employees.

Source: Boatman (2023)

1.6. Process of Data Analytics

The HR Analytics Process Model offers a comprehensive seven-step framework for

effectively addressing HR-related challenges and making informed, data-driven
decisions. Let's delve into each step with detailed explanations and examples:

Source:

1.6.1. Step 1 - Identify the Business Problem

In this initial phase, the focus is on gaining a deep understanding of specific HR-related
issues that require attention. For instance, a company may set out to reduce employee
turnover. To embark on this analytics journey, it's imperative to establish a clear and
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unambiguous objective. This step often involves collaboration between data scientists
and business experts to define key concepts such as customer segmentation,
transaction criteria, churn definition, or fraud identification. Agreement among
stakeholders on these fundamental aspects ensures a common understanding of the
project's goals, a vital factor for success.

1.6.2. Step 2 - Identify Data Sources

The second step involves identifying the sources of relevant HR data that will be
instrumental in addressing the business problem. These sources can encompass a wide
array of data points, including employee surveys, performance evaluations, attrition
rates, and more. The guiding principle here is to collect as much data as possible,
adhering to the belief that the richness of data enhances the analytics process. While
not all gathered data may be relevant, the analytical model, to be developed later, will
determine which data are essential for the task. These data are then collected and
consolidated within a staging area, which could be a data warehouse, data mart, or
even a straightforward spreadsheet.

1.6.3. Step 3 - Select the Data

In this phase, data selection becomes crucial. Specific datasets are meticulously chosen
for analysis based on their relevance to the business problem at hand. For instance, if
the objective is to understand attrition patterns, one might select turnover data sorted
by department and tenure. Additionally, basic exploratory data analysis techniques, like
using Online Analytical Processing (OLAP) tools for multidimensional analysis can be
applied to gain initial insights.

1.6.4. Step 4 - Clean the Data

Data cleaning, the focus is on ensuring the quality, accuracy, and reliability of HR data.
This phase involves a thorough assessment of data quality, validation against
predefined standards, handling of missing data, removal of duplicates, detection and
treatment of outliers, and maintaining data consistency, especially when integrating
data from various sources. For instance, it addresses issues like correcting mismatches
in job titles across different HR systems, ensuring complete and accurate records, and
handling missing performance scores. The goal is to prepare a clean and reliable
dataset for subsequent analysis, minimizing the potential for errors or biases that could
impact the accuracy of HR analytics results.

1.6.5. Step 5 - Transform the Data

The fifth step encompasses data transformation, wherein data is converted into a

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