Leveraging the power of human resource analytics for enhanced decision making: opportunities and challenges

Abstract

The fast-changing technological environment compels organisations to make swift and adaptive strategic choices, necessitating the use of tools and systems that can effectively manage complexities, foresee challenges, and capitalise on opportunities; as a result, there is a growing trend towards the adoption of human resource analytics to improve decision-making processes in the ever-evolving field of human resources. Despite the increasing use of HR metrics and analytics in human resource management, HR professionals have been relatively slow to embrace a data-driven approach, and existing research on data-driven decision-making in HRM often lacks the comprehensive frameworks necessary to provide practical guidance for the effective integration of human resource analytics. Hence, this study aims to explore the utilisation of human resource analytics to improve decisionmaking processes within organisations, highlighting both the potential benefits and the challenges that may arise. A systematic literature review revealed that the adoption of Human Resource Analytics offers organisations significant benefits, such as enhanced decision-making, better alignment with strategic objectives, improved employee experiences, a stronger competitive advantage, and reduced time expenditures. However, challenges persist, including concerns related to data privacy and security, the quality, integrity, and accuracy of data, a lack of data literacy and skills among employees, and inadequate technological infrastructure. To address data security concerns, HR technology providers must adopt robust security measures, including encryption, firewalls, and intrusion detection systems. Additionally, they should develop user-friendly data management systems and analytical tools that enable HR professionals to derive valuable insights from the data effectively.