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HRD's pocket guide to... big data

The HRD’s pocket guide series offers an explanation of areas outside day-to-day HR that business-savvy HRDs need to have a handle on

Why do I need to know about it?

Big data, machine learning, AI… these terms are increasingly thrown around (often interchangeably) in HR and the wider business world. But do you actually know what big data is and how it is used? Does your CEO or CFO? If the answer is a sheepish no, read on.

Big data has huge potential to help us make better-informed decisions. Basically big data is a lot of data; so much that no human could analyse it. “We rely on computer-generated algorithms that are trained to identify salient patterns in the data, evaluating billions of data points,” explains Tomas Chamorro-Premuzic, chief talent scientist at Manpower Group and professor of business psychology at University College London and Columbia University. “We call these algorithms machine learning, and that’s mostly what we call AI – at least in HR.”

By finding patterns in the data we can infer things about what’s happening presently (such as Google recognising a flu epidemic based on symptoms people were looking up), or predict what might happen in the near future (such as trends in the labour market based on what job applicants search for or what employers pay in specific sectors, which is what Manpower Group does).

What do I need to know?

Viktor Mayer-Schöenberger, professor of internet governance and regulation at the Oxford Internet Institute, outlines the various potential uses of big data in business. Using this to improve decision-making could be “about a new product or service – predicting maintenance needs before they actually happen; an innovative new insight into a business opportunity – for instance that one can derive economic growth indicators from the volume of international wire transfers; or how to improve processes – for instance by achieving better matches between talent and positions inside an organisation,” he says.

Data sets will likely be analysed according to the ‘five Vs’, explains senior lecturer in organisation studies at the Open University Business School Peter Bloom. These are “volume (the amount of data that can be stored and analysed), variety (the different forms data is extracted from), velocity (how fast and timely data can be analysed and exploited), veracity (how trustworthy the data being collected and created is), and value (the degree to which this data can be transformed into organisational value)”.

Where can HR add value?

There are many areas of HR ripe for a more analytical focus and drilling down into data – most notably recruitment where big data can be used to match talent to open positions, and to help eliminate unconscious bias in selection.

“Using big data insights can both help get a better understanding of current and future staffing needs, but also help identify the right candidates for any job openings,” says Cathy Temple, VP HR at Oracle. “The insights can help revitalise staff satisfaction and engagement. We’re seeing HR teams making use of big data to understand how happy staff are in their positions and then take steps to boost morale or identify alternative roles that better fit the individual.”

It can also be used to “better personalise people’s benefits so they are focused on individuals’ specific goals, development and empowerment”, adds Bloom.

Mayer-Schöenburger adds that using big data can “improve training processes by individualising training streams and programmes, and can greatly enhance capabilities when putting together teams to tackle particular challenges”.

Anything else?

Although computers and algorithms will take over most, if not all, data processing in the future, HR will still have a vital role.

“Big data is just a magnifying lens to help HR see things they would otherwise miss, or see things more clearly. It is no substitute for HR even if it may substitute or automate certain processes,” says Chamorro-Premuzic.