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REGULAR JOURNAL SECTION HR in an

environment
Human resources in an enriched of BI
environment of business
1625
intelligence
Bhushan Kapoor
California State University, Fullerton, California, USA, and
Joseph Sherif
California State University, Fullerton, California, USA and
The Jet Propulsion Laboratory, Caltech, Pasadena, California, USA

Abstract
Purpose – While many organizations are starting to use business intelligence (BI) in many areas of
their businesses and make substantial gains, they have taken little advantage of this in the human
resources (HR) management area. The purpose of this paper is to advance BI and data analytics
technologies as precursors to the design of HR management protocols and database strategies.
Design/methodology/approach – The paper discusses the fact that the increasing prevalence of
globalization is driven by a number of factors including growing consumers in developing countries,
technological progress, and worldwide workforce diversity. HR departments of global companies must
implement BI techniques and assemble global databases that obtain information such as employee’s attrition
and hiring, compensation and benefits, ethnic, gender, cultural, and nationality distributions. By applying
advanced analytical techniques on the global database, human resources professionals will acquire
intelligent business insight, predict changes and make informed decisions at operational and strategic levels.
Findings – The business environment is constantly evolving into a more complex system and with
global competition, decision making in organizations has become increasingly intricate and
convoluted. This creates challenges for global organizations’ HR departments to manage a workforce
diverse in cultures, time zones, expertise, benefits and compensations.
Practical implications – Only those multinational enterprises willing to adapt their human
resource practices to the changing global labor market conditions will be able to attract and retain high
performing employees. BI and data analytics can aid in making informed decisions based on
knowledge extracted from the data and options at hand. Organizations that have successfully
implemented BI are able to make decisions quickly and with more accuracy. They have better and
faster access to the key activities and processes that the organizations and its functional departments
must pursue to meet their goals and objectives.
Originality/value – The paper tackles one of the most critical problems of educating multinational
enterprises to adapt their HR practices to the changing global labor market conditions. By incorporating
BI and data analytics in the design of HRM protocols and database strategies they can attract, develop
and retain high performing employees and succeed in the global business competition.
Keywords International business, Human resource management, Data management, Global databases,
Multinational organizations, Business intelligence, Information management
Paper type Research paper
Kybernetes
Vol. 41 No. 10, 2012
pp. 1625-1637
q Emerald Group Publishing Limited
0368-492X
This paper is in memoriam of Dr Joseph Sherif. DOI 10.1108/03684921211276792
K Introduction
41,10 Human resource intelligence (HRI) consists of processes for making facts based human
resource decisions in an enriched environment of business intelligence (BI). BI
encompasses people skills, technologies, applications, and business processes to make
better strategic and tactical business decisions. It plays a crucial role in achieving
competitive edge over competitors in the challenging economy we are in. These
1626 processes pertain to collect, transform and manage key human resource related data and
documents, to analyze the gathered information using BI and business analytics models,
and to disseminate the analysis results to decision makers for making intelligent
decisions. The analytical models include statistical and data mining techniques to
analyze large volumes of data for querying, reporting, visualizing, and advanced
analytical techniques for clustering, classification, segmentation, and prediction.
The analysis results provide business insight, and help make better business decisions.
The primary human capital management functions are to effectively acquire, develop
and retain human capital for all business units in the company. HRI can help companies
identify and foresee their workforce needs – especially for high skills – and take
intelligent action plans. HRI systems are software that automates the HRI processes.
These are specialized human resource information systems embedded or integrated
with BI and business analytics software tools. Like other BI systems, HRI systems
leverage powerful technologies, such as data warehousing and business data analytics
for information-driven answers to their operational, tactical, and strategic questions.
To get most of HRI systems these must be carefully designed and configured to sync
with the processes. These are critical to formulate questions or hypothesis, to compute
and disseminate results to appropriate users, and then for the users to draw insights
from the results to shape business decisions and, as a result, improve performance.
The human resource departments are transforming as modern businesses face
numerous and complex challenges, and exploit opportunities. The transformation of
human resources today is a direct call of the rapid changes within businesses due to
combined forces of demographics, globalization and information technology. Friedman
(2005) described instrumentation of globalization as a whole set of technologies and
political events converged – including the fall of the Berlin Wall, the rise of the internet,
the diffusion of the Windows operating system, the creation of a global fiber-optic
network, and the creation of interoperable software applications, which made it very
easy for people all over the world to work together – that levelled the playing field.
It created a global platform that allowed more people to plug and play, collaborate and
compete, share knowledge and share work, than anything we have ever seen in the
history of the world. The numerous free trade agreements have made easier flow
of capital, people and knowledge. The new global world has widened the talent pool of
workers from different parts of the world, and has made it possible for organizations to
hire workers from this pool. The primary purpose of HRI systems is to gather and
maintain data for predicting short and long term trends in supply and demands of
workers in different industries and occupations and help global organizations make
strategic decisions relating to optimal acquisition, development and retention of their
human capital. An organization’s talent can be a source for a sustained competitive
advantage and can affect important organizational outcomes such as survival,
profitability, customer satisfaction level, and employee performance (Stroh and
Caligiuri, 1998; Pfeffer, 1994).
Drivers of human resource transformation HR in an
Major drivers of human resources today are combined forces of globalization, environment
demographic changes, and technological changes. The increasing prevalence of
globalization is being fueled by demographic changes in the developed and developing of BI
world and technological progress.

Globalization 1627
Globalization means that the world market is increasingly behaving as a single market
based on interdependent supply chain production with raw material and components
coming from different parts of the world. The number of trade agreements between
different countries of the world is on the rise. According to the World Trade
Organization, over 420 arrangements covering trade in goods or services between
countries of the world have been notifies. A large majority of these agreements (over
300) were concluded after 1995. The average tariff rates on manufactured goods for
developed countries has come down from about 20 percent in 1950, to about 5.9 percent
in 1990, to about 4 percent in 2002. World trade has increased significantly in the last
decade. The ratio of world imports to gross world product, GWP, has grown from just
10 percent in 1970 to over 18 percent in 1996.
Global staffing and global leadership development are the two components of global
human resources with the greatest potential for powerful leverage for global firms
(Pucik, 1996). Only the multinationals that will be able to make fact based decisions to
suitably adapt their human resource practices to the changing global labor market
conditions will be able to attract, develop and retain the right talent, and will likely
survive, succeed and prosper in the global competition.

Demographic forces
Despite the current economic downturn and unemployment, most developed countries,
including the USA, Germany and Japan will face long term talent shortages mainly due
to ageing and retirement of baby boomers. There are more workers retiring than
entering the labor force in these countries. By 2020, for every five retiring workers, only
four new workers will join the labor force in most developed countries. According to an
estimate the USA will need to add 26 million workers to its talent pool by 2030 to
sustain the average economic growth of the two past decades (1988-2008) unless a
technological breakthrough replaces manpower, while Western Europe will need to
add 46 million employees (World Economic Forum, 2010). The shortage of workers is
predicted across most industries, including manufacturing, construction, transport and
communications, trade, hotel and restaurants, financial services, IT and business
services, health care, public administration, and education.
The opportunity has never been greater for multinationals to attract top talent from
emerging countries, such as Brazil, Russia, India, and China, or to outsource work to
these countries. Global population growth differs between developed and developing
countries. In the developed countries, the USA, EU, and Japan, the current annual rate
of growth is less than 0.3 percent, while in the rest of the world the population is
increasing almost six times as fast. According to McKinsey Global Institute, there are
approximately 33 million potential professionals in emerging market and they are
growing very quickly. The stock of suitable, young professional talent in emerging
market is growing at 5.5 percent annually, while the number in developed countries is
K growing just 1 percent annually (McKinley Global Institute, 2005b). The total number
41,10 of university-educated talent in low-wage countries far exceeds the number for high
wage countries. At present, India produces as many young engineers as the USA,
and China has more than twice as many. Russia produces ten times as many finance
and accounting professionals as Germany. According to International Organization for
Migration, there were an estimated 214 million international migrants in the world in
1628 2010, and 57 percent of all migrants live in high-income countries. The number of
migrants is likely to grow at high speed in the coming years. The migration of workers
and outsources of work would not be just one way from emerging countries to
developed countries, but it will be in both directions.
The global supply of talent is short of its long-term demand, and the gap is a challenge
for employers everywhere. The shortage between the demand and supply of talents is
likely to continue to increase, notably for highly skilled workers and for the next
generation of middle and senior leaders. Most emerging nations with large populations,
including BRICS countries, Brazil, Russia, India, China, and South Africa, may also not
have a net surplus workforce with the right skills for very long. Now organizations need
to place greater emphasis on attracting human capital rather than financial capital.
Because capital is broadly available from investors and lenders, and innovations can be
duplicated relatively easily and quickly, effective human resource management is the
best way to differentiate your company from the rest in business today.

Information technology
The globalization is driven by the development of inexpensive, yet very powerful
technologies, including the intra- and internet, enterprise resource planning system,
data warehouse, data mart, and data analytics. Cloud computing and new advances in
remote access and support technologies also seem to fuel globalization. Many service
jobs, such as call centers, animation, transcription, and software development can be
carried out remotely. It is estimated that 160 million jobs, or about 11 percent of the
projected 1.46 billion service jobs worldwide in 2008, could be carried out remotely,
barring any constraints on supply (McKinley Global Institute, 2005a). Human
resources need to take advantage of technology and data analytics to build a global
HRI system that collects and stores data from various sources and locations into data
warehouses and data marts, and analyzes the data to get business insights and predict
future needs and develop strategies to fill the needs.
With the development of computer technology and internet, globalization is
increasing rapidly, such as e-mail, Http services, or EDI shorten the space-time
significantly. Because of these technologies, multinational corporations have emerged;
they can operate their business and manage internal affairs via network.

Roles and responsibilities of human resources of a global organization

In the past, human resource function was typically considered a cost center and an
administrative overhead. The human resource departments focused on short-term
gains and savings. They focused on administrative efficiency and compliance
activities. They tended to expense investments in talent intangibles rather than
capitalize and tended to raise short-term earnings by cutting discretionary expenditure
on people development (Guthridge et al., 2008; Hamel and Prahalad, 1994; Schuler and
Jackson, 1987). Such tendencies achieved short-term successes but encountered
long-term problems when the objectives were achieved at the expense of employee HR in an
productivity. environment
The new human resource role is to focus on organizations’ long-term objectives.
Instead of focusing exclusively on internal human resource issues, modern human of BI
resource department takes a balanced and broader approach. They place emphasis on
future-oriented plans and objectives and value adding initiatives (Adler and Ghadar,
1990; Adler, 1997; Kobrin, 1992; Milliman et al., 1991; Tung and Punnett, 1993). Ulrich 1629
(1996) defines the roles of human resource based on the following four functions –
strategic business partner, change agent, employee champion, and administration
expert. They are also champion of globalization and technology savvy.

Strategic business partner and change agent

Strategic business partner and change agent functions are about leading and helping in
formulating the organization’s overall business strategy and alignment of human
resource activities and initiatives with the organization’s overall business strategy.
Unless the human resource strategy is appropriately formulated and skillfully
implemented, success of the organization is at risk (Belcourt and McBey, 2010). In these
roles, the human resource professional contributes to the formulation and the
accomplishment of the organization-wide business plans and objectives, and
formulates the human resource business objectives to support the attainment of the
overall strategic business plans and objectives.
Talent planning should be inextricably linked with strategic planning and, as such,
regularly addressed by human resource executives. Companies need to develop leaders
capable of generating growth and effectively managing a multicultural workforce.
Leaders themselves need to represent diverse cultures and backgrounds so the
structure of the decision-making bodies with organizations reflects a more diverse
composition of the marketplace (World Economic Forum, 2010).
The human resource personnel do periodic evaluation of the effectiveness of the
organization at corporate level. The personnel anticipate changes and understand what
is necessary to implement it. The human resource professional is skilled in getting
business insight, to predict changes, and make informed decisions at operational and
strategic levels. The human resource professional accesses current and anticipates
future skills shortages through strategic skills planning. Business volatility and
uncertainty increase the need for companies to rely on advanced analytics, scenario
simulations, and other sophisticated workforce-planning levers (BCG and WFPMA,
2010b).

Partner with frontline and middle managers

One of the characteristic features of the human resource literature is the pivotal role
that has been given to frontline managers as a delivery point for a variety of
employment policies that are intended to raise the performance of the workforce
(Gratton et al., 1999). The people and performance research carried out for the CIPD by
a team at Bath University found that where employees feel positive about their
relationship with their frontline managers they are more likely to have higher levels of
job satisfaction, commitment and loyalty which are associated with higher levels of
performance (Hutchinson and Purcell, 2003). The human resource role is to partner
with frontline and middle managers to effectively acquire, develop and retain human
K capital for all business units in the company. Modern technology has made it possible
41,10 to for human resource personnel and line managers to have virtual, without face-to-face
meetings and communications.

Employee advocate and champion of globalization

As an employee sponsor or advocate, the human resource manager plays a pivotal role
1630 in organizational success via his knowledge about and advocacy of people. This
advocacy includes expertise in how to create a work environment in which people will
choose to be motivated, contributing, and happy (Ulrich, 1996). When employees are
motivated they want to do their best work – not out of obligation but because their job
matters to them, both professionally and personally. On the other hand, discipline
comprises systems, policies, and practices that raise accountability. When motivation
and discipline unite, employees are excited about, accountable for, and rewarded for
their work (BCG and WFPMA, 2010a). Workplace flexibility is expected to be on the
rise in the future workplaces and thus, most of the interaction between human resource
personnel and line managers or workers will be virtual, without face-to-face, meetings.
The human resource personnel are a champion of globalization, and help develop
global mindset in its employees. Having a global mindset implies recognition of
benefits that can flow to the whole organization from encouraging and valuing cultural
diversity in people. Globalization is increasingly adding one more thing to low-cost
labor and high-power technology: unfettered imagination – that is, high innovative
and creative capabilities (Friedman, 2005). The role of human resource is to implement
the necessary organizational strategies with sensitivity to specific cultural influences
(Pucik, 1996).

Component of a HRI system

Global organizations are utilizing the organization’s data to making informed decisions
instead of relying on their intuitions or gut feelings. Likewise, HR departments of
global companies also assemble the data such as on employees, attrition and hiring,
compensation and benefits, ethnic, gender, cultural, and nationality distributions, load
the same into data warehouses and data marts, analyze and get business insights, and
make fact based decisions.
The global human resource information system consists of a number of component
systems that are interdependent. The various components may be broadly classified
into the following four main sub-systems: data warehousing, data analytics,
performance management system, and information delivery. These tools and
systemic processes are critical to formulate questions or hypothesis, to design data
and analytical models, to compute and communicate results to appropriate users, and
then for the users to draw business insight from the results to shape business decisions
and, ultimately, improve performance.

The data warehousing system

A data warehouse is a decision support database that is maintained separately from
the organization’s operational databases. Operational databases contain data
pertaining to each transaction and data warehouse contain summary data such as
totals, counts, maximums and minimums. The data stored in a data warehouse is
optimized for querying and data analysis. Data warehousing system deals with design,
implementation, and operations of a data warehouse including data extraction, data HR in an
cleansing, data transformation, and loading of data from different sources. The system environment
also includes meta-data management, security management, backup and restore, and
disaster recovery. of BI
The data warehouse is able to collect and combine data from various sources.
Employee data is generally housed in separate human resource systems based on
vertical human resource functions, such as benefits, payroll and compensation, leave, 1631
training, performance appraisals and surveys and/or horizontally across functional
areas. Companies need to identify all internal and external data sources and then
consolidate the data into a human resource data warehouse or, one or more data marts.
The design of a data warehouse depends on identifying facts, dimensions, and
granularity. Facts are summarized numerical data stored in a table called fact table.
Dimensions are categories by which summarized data can be viewed. Each dimension
can have one or more hierarchies. Hierarchies are logical structures that use ordered
levels as a means of organizing data. Query tools use hierarchies to drill down or roll
up into your retrieved facts to view different levels of granularity. Granularity refers to
the level of detail of the data stored in a fact table. The more detail there is in a fact
table, the higher its granularity and vice versa.
We may also (for performance and confidentiality reasons) choose to store the facts
at some intermediate level of granularity. As compared to the data warehouse with
highest granularity, this data warehouse does not contain details that could be very
valuable to the company. In general, as the granularity level is lowered, the system
contains less detailed information (therefore less useful), but gains in performance (in
speed and storage) and confidentiality of individual records.
The information technology professionals are overall responsible to design a
data warehouse system that is optimal in storage and performance, and human
resource department is responsible to ensure that each user in their group has the
information detailed enough to do his or her job. The performance and usefulness
oppose each another and information technology and human resources departments
need to find an optimal solution that is overall best in the long run for the
organization as a whole.

The business analytics system

The global human resource information systems are generally very rich in business
analytics applications, including online analytical processing (OLAP), data mining,
and advanced analytics applications based on statistics, forecasting and predictive
analytics. These applications not only can give answers to questions, such as, “what
happened? Why did it happen?” but also can enables the user to predict and influence
the future. The advanced analytics can answer some deeper human resource questions,
such as “in what ways human capital investments will contribute to business
performance? How much do human resource activities impact employee performance?
What skill needs and opportunities lie ahead?”
OLAP applications can retrieve summary statistics (metrics), such as totals,
averages, percentages, Standard Deviations, maximum, minimum of data
measurements (facts) from multiple dimensional views. These applications are
capable to perform several data retrieval operations, including drill down, roll up, and
slice and dice and allow users to view metrics based on different detail levels.
K Mega BI vendors have incorporated comprehensive statistical and data mining
41,10 capabilities in their software. Data mining is an extension of statistical techniques such
as, classical and artificial intelligence. Statistical techniques are generally applied to
relatively small-size sample data selected randomly and specifically to validate a
hypothesis. These techniques conform to a set of assumptions about the population
and are called “verification driven techniques”. Data mining includes techniques called
1632 “discovery driven techniques” that do the exploration and analysis by automatic
means of large quantities of data in order to discover meaningful hidden patterns in
order to find relationships, associations, and trends among the data measurements
(Kim, 2002; Tan et al., 2006; Shmueli et al., 2010) and this knowledge is then applied to
achieving specific business goals. By contrast, predictive analytics includes statistical,
mathematical, and data mining analyst-guided (not automatic) techniques that do the
exploration and analysis of large quantities of data in order to make decisions by
forecasting the outcomes. Whereas OLAP and data mining focuses on past performance,
predictive analytics forecasts behavior and results in order to guide specific decisions.
If OLAP and data mining can tell what has happened and why did it happen, predictive
analytics can tell what to do.

Performance management system

It consists of processes for strategic goals and objectives, performance measurement
and mentoring, analyzing performance and making decisions to improve business
performance.
Strategic goals and objectives – a strategic goal is a broad statement of what the
management wants to achieve, and an objective is usually time bound specific course
of action that contributes to the achievement of the strategic goal. There may be
several objectives pertaining to a goal. Here is an example of a goal and its two
objectives as planned by HR department of the state of California (www.dpa.ca.gov/hr-
mod/accomplishments-and-goals/mission-statement-goals-and-objectives.htm).
Goal: improve and instill high performance in the workplace.
The primary purpose of employee learning and performance management is to
improve both employee and organizational performance. Within state service, staff
development is too often considered an expense rather than an investment. This goal
will establish performance management as a basic objective for improving service to
internal and external customers including the citizens of California.
Objective no. 1: ensure supervisors/managers acquire, implement, and apply
principles necessary to foster high performance in the workplace.
Currently, employee appraisals are done irregularly, despite the requirements for
annual appraisals and individual development plans. As we convert to a competency-
based HR system, performance will be used to assess current competencies, identify
training needs, and better align resources to achieve organizational effectiveness. It is
essential supervisors/managers continually provide meaningful feedback.
Properly trained, informed and accountable management is the key to establish
and foster high performance. To achieve this, performance management training and
training assessment methods must be established to evaluate the effectiveness of
the training received. Continuing education and resources (e.g. communication forums,
webcasts) must be made available to keep supervisors/managers informed and
apprised of industry best practices. Automated tools must also be created and made
available to support improved methods for ascertaining the achievement of performance HR in an
goals and objectives. These will further provide opportunities to more effectively environment
measure management compliance. A compliant, consistent, and available 80-h
supervisor/manager training program will be deployed by winter 2009. of BI
Objective no. 2: ensure supervisors/managers conduct meaningful timely
performance appraisals.
This objective will equip supervisors/managers with the skills necessary to provide 1633
constructive feedback to staff. Supervisors/managers will be held accountable in their
personal performance appraisals for assessing their staff. Initial learning management
tools will be available by summer 2009. Identification of performance management
tool(s) will be accomplished by fall 2009. Organizations make operational and financial
plans to achieve organization’s strategic goals and objectives, and then initiate projects
to implement the plans.
Performance measurement and monitoring – during the entire period of the project,
the outcomes are measured and trends are monitored in real time. The measurements
are done according to certain key performance indicators (KPIs). The KPIs need to be
designed for each functional area and for each of the levels in the organization starting
from the highest, moving towards the lowest. Performance indicators are leading
indicators that gauge the outcome by examining incremental progress of the project.
Performance indicators with respect to human resources may include employee
retention, job satisfaction, compensation and rewards, employee training, accident
levels, employee absenteeism, and employee performance.
Analyzing performance – KPIs are compared to the strategic goals and objectives.
The results are utilized to monitor, further analyze and act to improve performance.
The advanced analytics subsystem enables organizations to make informed decisions
to align their goals and objectives, as well as programs and budgets to the performance
indicators.
Decision making and performance feedback – the organizations are able to adjust
their goals and objectives, modify programs, and re-allocate resources and funds.
Performance measures in essence provide a feedback loop in the process of business
performance management.

The information delivery system

The information delivery system gives business users the ability to access reports
and continuously monitor performance of a project or entire organization at enterprise
and lower levels. End-users are also able to monitor the key activities such as trends,
metrics, and KPIs in easy-to-understand designs, such as configurable information
portals, scorecards and dashboards. Depending on an individual’s role and
responsibility, he or she is presented with the trends, metrics, and KPI at
appropriate aggregate levels. Some users can get to the lowest detail that exists in the
warehouse.

BI adoption in industry and human resources

BI is gaining rapidly in popularity, faster than most anticipated. It was found that BI
and business analytics software revenue was $25.2 billion in 2009, a 13.9 percent
increase from the 2007 revenue of $22.1 billion, and a 43.6 percent increase from
the 2005 revenue of $17.5 billion. We have proportioned the total BI revenue into
K four parts – data warehousing platform, advanced analytics software, analytics
41,10 business applications and information delivery tools. The rate of increase was
phenomenal in each of the segments and in each of the periods (Table I). For example,
the rate of increase for data warehousing platform from 2005 revenue to 2009 revenue
was 49.2 percent. In addition, the corresponding rates of increases for advanced
analytics applications, analytics business applications, and information delivery were,
1634 respectively, 39.2, 40.5 and 42.8 percent.
Data warehousing platforms were found to have a $7.8 billion (28.8 percent) market
share of total worldwide BI software revenue. Advanced analytical software were
found to have a 1.5 billion (6.7 percent) market share, analytic business applications
were found to have a $9.37 billion (34.5 percent) market share, and information delivery
tools were found to have a $6.48 billion (23.9 percent) market share. The market
segments, advanced analytical software and information delivery tools are BI tools,
which had a combined revenue estimate of $8.0 billion (30.6 percent) market share in
2009. The BI software market has continued to outperform the overall enterprise
software market in the past few years. Seeing tremendous opportunities in BI, there
has been a large number of acquisitions and mergers of BI companies by
Mega-vendors, SAP, IBM, SAS, Oracle, and Microsoft. They have benefitted
tremendously from the acquisition of these independent BI companies, and have made
BI software their focal product to develop or acquire. Each also offers HR modules with
BI and data analytics capabilities embedded in them.
The vendors claim that the following features and functions are included in their
HRI software: workforce planning, workforce cost planning and simulation, workforce
benchmarking, workforce process analytics and measurement, talent management
analytics and measurement, strategic alignment with goals of the organization,
predicted turnover percentage, causes of voluntary termination. The software can help
identify those in the high-risk group by job category, pinpoint the employees most
likely to voluntarily leave, monitor workforce demographics in line with recruitment
and retention objectives, analyze efficiency of the entire recruitment process lifecycle,
understand and prevent the drivers of employee turnover, gain insight into the
movement of top and bottom performers in the organization to engage and develop

Growth % Growth %
Market 2005 2007 2009 2005-2009 2007-2009

Data Warehousing Platform 5225 6744 7797

(29.8%) (30.5%) (28.8%) (49.2%) (15.6%)
Advanced Analytical Applications 1093 1378 1522
(6.2%) (6.2) (6.7%) (39.2%) (10.4%)
Analytics Business Applications 6671 8304 9371
(38.1%) (37.6%) (34.5%) (40.5%) (12.8%)
Information Delivery Tools 4539 5675 6483
(25.9%) (25.7) (23.9%) (42.8%) (14.2%)
Table I. TOTAL 17528 22101 25173
Worldwide BI and (100%) (100%) (100%) (43.6%) (13.9%)
analytics software
revenue estimates by Note: $ millions
market segments Sources: Adapted from IDC (November 2008) and IDC ( June 2010)
internal talent, gain insight into learning demand by analyzing course enrollments by HR in an
job, delivery methods, and organizations, understand how compensation impacts environment
performance, ensure compensation is equitable and consistent across roles, and align
variable compensation with your organization’s objectives and goals, get a of BI
comprehensive view into employees’ current, planned, and historical absence events;
monitor absence trends as a predictor for employee engagement, and assess HR’s
overall performance and employee productivity using industry benchmarks such as 1635
revenue per employee, contribution per headcount, and return on human capital.
The leading-edge companies are increasingly adopting advanced HRI systems to
gain intelligent business insight and enhance their competitive advantage. The best
organizations see their people not only as individuals but also as a rich source of
collective data that managers can use to make better decisions about talent. Future
organizational performance is inextricably linked to the capabilities and motivations of
a company’s people. Organizations that have used data to gain human-capital insights
already have a hard-to-replicate competitive advantage. Others, too, can draw on
these new techniques to improve their business results (Davenport et al., 2010). By
incorporating BI and data analytics in the design of human resource management
protocols and database strategies they can attract, develop and retain high performing
employees and succeed in the global business competition.

Conclusion
With global competition, decision-making in organizations has become increasingly
intricate and convoluted. This creates challenges for global organizations’
HR departments to manage workforce diverse in cultures, time zones, expertise,
benefits and compensations. The global supply of talent is short of its long-term
demand, and the gap is a challenge for employers everywhere. The shortage
between the demand and supply of talents is likely to continue to increase, notably for
highly skilled workers and for the next generation of middle and senior leaders. Only
those multinational enterprises willing to adapt their HR practices to the changing
global labor market conditions will be able to attract and retain high performing
employees.
Having seen BI as the core enterprise strategy, the mega software vendors have
spent billions on acquiring other BI focused companies. The giant vendors have now
BI solutions for organizations of most types and sizes. While many organizations have
purchased their BI software and are starting to use in many areas of their businesses
and make substantial gains, but they have taken little advantage of this in HR
Management area. Executives should view HR as a strategic asset within their
organizations.
The new human resource role is to focus on organizations’ long-term objectives.
Instead of focusing exclusively on internal human resource issues, HR executives
should take a balanced and broader approach. They should place emphasis on
future-oriented plans and objectives and value adding initiatives based on the following
four functions – strategic business partner, change agent, employee champion, and
administration expert. By taking advantage of the enriched environment of BI, HR can
position itself as essential value-adding department of the organization. BI and data
analytics can aid in making informed decisions based on knowledge extracted from the
data and options at hand.
K References
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Further reading
Davenport, T. (2006), “Competing on analytics”, Harvard Business Review, Prod. #:
R0601H-PDF-ENG.

Corresponding author
Bhushan Kapoor can be contacted at: bkapoor@fullerton.edu

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