In past downturns, organisations reduced headcount, training, benefits and compensation across the board. This time, thanks to HR analytics, organisations can turn to cost cutting measures with a difference: they can sift through far more data to determine more precisely who is achieving their performance goals and have the competencies that will be needed for today and tomorrow.

The increased power of having metrics and analytic insight can align core HR business processes with organisational goals and strategies and help ensure organisations make the right business decisions. Organisations supported by workforce analytics can more thoughtfully manage their workforce with training, development, benefits and compensation.

From the annual CedarCrestone HR Systems Survey (“survey”) conducted over the last few years, we have seen that organisations with certain key HR technologies and analytics have better financial metrics than organisations without these technologies:

1. Organisations that move to employee and manager self service and to shared services with an automated help desk for HR are able to serve more employees with fewer HR administrative staff than those without. These organisations also have higher operating income growth than organisations without these technologies. This has been a consistent finding since 2000.

2. Organisations with competency management have significantly higher sales growth than those without. This has also been a consistent finding since the 2005 survey. Organisations with competency management as the core of any talent management approach are able to assess which competencies it needs to plan for, recruit for, develop for, and pay for. These organisations have the right people with the right skills working on the right objectives and are able to pay them right.

3. Integration matters. Since 2007, the survey has also shown that organisations that have integrated their talent management processes to their HRMS, and to the business intelligence environment have stood out in terms of financial performance on revenue, sales, and operating income growth.

4. Organisations with more than the average Business Intelligence (BI) applications in place have higher one- and two- year sales growth than organisations with less of the applications. Since 2007, the survey has also reported that organisations with some key BI applications have stood out in terms of sales growth. These applications include operational and ad hoc reporting; as well as middleware technology that does the heavy lifting of extracting, transforming and loading data from multiple sources into reportable formats; and HR warehouse that stores workforce and performance data; and workforce analytics.

Thus it is clear to us that analytics matter. By using HR analytic solutions that provide proactive, event-based, and scheduled alerts, delivered directly by email, cell phones, or to personalised dashboards, organisations can more effectively manage and improve performance, becoming best practice organisations that balance the optimal effective headcount with assurance of satisfactory service delivery.