Employee data is a rich source of database that, if utilised effectively, can reveal key people insights and facilitate decision making when it comes to formulating people strategies.

However the big question is – how can organisations use employee data effectively and to their advantage?

What is employee data?

The first step is to understand the type of data collected from employees. This could include personal data such as date of birth, date of hire, gender, marital status, and nationality. Employment-related data then differs between each individual employee, such as internal grade, department, compensation package, performance rating and even talent management indicator.

According to the definition by Darwinbox, an employee database “contains critical information, such as each employee’s personal information, as well as company-related information such as their pay scale, hire date, and more”. A good employee database should ideally be accurate, up-to-date and easy for employees to add and edit their information while ensuring ease of accessibility by HR.

How to collect employee data?

Before deciding on the type of employee database and the tracking tools, ensure that the chosen tool or software offers flexibility for employees to decide on the type of information they choose to share and allow them to review the data when they need to. It should not infringe on employees’ privacy or leave employees wondering how their data will be used. HR needs to explain how they will be collecting the data, what they will do with it and why they need it. The information conveyed to employees should be factual and jargon-free.

Employee data is dynamic and needs to be updated periodically for the data to stay relevant. There are various methods in which HR can collect employee data, but a “one and done” approach should be avoided. For collection and update of basic employee information, employee self-service portals are the most efficient method. As for work performance data, which typically includes salary data, performance ratings or leave records, a manager self-service portal is effective in gathering basic work-related data while standardising inputs throughout the organisation.

To gather open-ended feedback, there are several ways in which employees can share their insights. This could include employee pulse surveys, anonymous feedback platforms, town halls or perhaps one-to-one conversations with their direct supervisors.

Maximising the use of employee data

If your HR department is merely collecting employee data without putting it to good use, then there are many missed opportunities. In today’s data-driven workplace, it is critical to understand how to maximise the use of employee data. This helps business leaders to make smarter and more cost-effective decisions about people-related issues, from hiring and retention to compensation and benefits programmes.

Here are some ways to make employee data the organisation’s most powerful tool:

Properly tracking employee data points

Employee data refers to all the information collected about the organisation’s employees. This includes basic information as well as in-depth details about workplace performance and employment. If your organisation utilises an external payroll provider to support certain HR functions, such as leave management or benefits, chances are that you may have access to additional employee information such as healthcare expenses or leave trends. These data should ideally flow into a central repository for monitoring, tracking and analysing.

Linking employee data with people analytics

Employee data helps to develop a holistic view of your workforce. In order to identify patterns and pull out insights, the next step is to identify key people-related issues or challenges that business leaders are trying to resolve. This process is also known as people analytics – analysing employee data to derive insights and trends. Employee data, when used effectively, can help to reduce turnover rates, boost productivity, and perhaps identify patterns of growth and loss. Business leaders are then able to zoom into specific departments or employee groups to understand employees’ pain points.

Use employee data holistically

Looking at a specific employee data may not be meaningful. However, when employee data is viewed holistically, it can potentially reveal patterns of growth and loss and additional insights. For example, if a new hire in the Sales department quit just after 3 months, it may be due to a job misfit. However, if majority of the new hires in the Sales department only have a tenure of 3 months or less within a one-year timeframe, there could be an issue with the workload or the management style. Identifying trends in data can help business leaders to uncover problems like these, allowing management and HR to find a solution quickly instead of merely ignoring the issue.

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