About analytics- Steadily, people analytics will make HR a discipline in which intuition and data are combined and will lead to even better decision making, writes Erik van Vulpen, co-founder of Analytics in HR.
People analytics is on the rise. In this article, I want to go over five common misconceptions that keep coming back. I want to demystify these false ideas — and I saved the biggest one for last! Let’s dive right in.
Misconception 1: People analytics predictions are accurate
One of the main challenges in people analytics is predicting complex human behavior. Predictive analytics will never predict behavior with a 100% accuracy. An algorithm that predicts performance (or any other behavior) with an accuracy of 40% is already very good. The big advantage of people analytics lies in the difference between what algorithms can do and what people do: even at 40%, algorithms are still better at predicting performance than humans.
How accurate you can make your predictions has everything to do with your input and output data. If you have relevant and high-quality input data and are also able to assess the outcome very accurately, your algorithm will be even better.
Misconception 2: Correlation equals causation
One of the most persistent misconceptions in every area that has to do with analytics is that things that act together are related.
Even though most of us know the saying that “correlation doesn’t equal causation,” we are always on the lookout to identify relationships between different things that happen around us.
One of my favorite TV shows is “The West Wing,” a political drama. The following scene is set in the Oval Office where Martin Sheen (who plays U.S. President Josiah Bartlett) explains the ‘post hoc ergo proptor hoc’ fallacy, a good example of this misconception.
The thing is that most correlations are purely coincidental. The same will happen in people data. There’s often a third factor that can explain a correlation in your data. Drawing a cause-and-effect relationship requires complex research designs and data that stretches over a longer period.
That’s why your research should always start with a research question related to a topic that the organization is dealing with at the moment.
Misconception 3: People analytics helps HR
Technically, this statement is only a partial misconception. In line with the previous, people analytics should add value to the business. This is the most important criteria for any analysis. If the analysis doesn’t add value, why do it in the first place? The resources are better spending on projects that actually do add value.
People analytics should help HR indirectly. Because people analytics focuses on the quantification of the people drivers of business outcomes, it will impact how we manage people — and thus help HR do their work better — but only because this, in turn, will help to achieve a strategic goal.
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source http://news.statii.co.uk/5-misconceptions-about-people-analytics/
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