What is analytics?

Analytics - from Greek work Analutika –

It is the science of analysis

Arts Science

Analytics

Logic Statistics
Design Produce

Evaluation E

Strategic
Operational
Future

Analytics is the systematic computational analysis of data or statistics. It is used for the
discovery, interpretation, and communication of meaningful patterns in data. It also entails
applying data patterns towards effective decision making.
Analytics is a meeting of art and science. The arts teach how to look at the world. The sciences
teach how to do something.

Evolution of business analytics.

The evolution of business analytics can be traced back to the late 1800s when Frederic
W.Taylor father of scientific management, was working on increasing efficiency of the
business. It was followed by the time measurement technique used by Ford to measure the time
taken by different models of the assembly line in the early 1900s. As a result of second world
war Kerrison Predictor, which was a computerized anti-aircraft fire control system, emerged
in 1940. Subsequently, Manhattan Project, computerized weather forecast and the like were
the major contributors to the growth and development of business analytics. In the late 1960s,
Analytics began receiving more attention as computers became decision-making support
systems. With the development of Big Data, Data Warehouses, the Cloud, and a variety of
software and hardware, Data Analytics has evolved, significantly. Data Analytics involves the
research, discovery, and interpretation of patterns within data.
In the present century, data analytics have advanced to include Big Data, cloud computing,
artificial intelligence, enterprise recourse planning etc.
All these developments in the early stage were driven by the need for achieving operational
efficiency.

Timeline Major contributors

Late 1800s Introduction of the first formalized system of business analytics in the USA
by Frederic W.Taylor
Early1900s Efficiency of assembly line measured in terms of the time it takes in
manufacturing automobiles by Ford.
1940 Development of a computerized, fully automated, anti-aircraft fire control
system by Kerrison Predictor.
1944 Utilization of Monte Carlo simulation technique to forecast the course of
nuclear chain reactions as a part of the Manhattan Project.
1950 Development of the computerized weather forecast model for the first time.
1956 Operations-based efficiency prediction for transferring logistics in the least
possible time. Technology was used to solve the shortest route problems.
1958 Usage of predictive modelling to assess credit risk by FICO
1973 The Black-Scholes Model for optimal stock options pricing.
1979 The first commercial tool for model-based decision support system (DSS)
development.
21st century Big Data and the clod came along real-time analytics, automated analytic,
ERP Systems, data warehouses.

Typical Data Issues

Human resources departments have been slow to get on board with big data, and it’s not just a
lack of forward thinking. They face big challenges when implementing hr data analytics, both of
logistics and mindset.

1. Bringing Together Data From Many Different Places

A big data initiative requires HR to acquire data from all the different departments within the
business. They have to acquire, sanitize, unify, and analyse data from multiple departments as
well as from multiple business functions, including payroll and finance.

The problem gets even bigger for HR departments venturing outside their companies into the
world of unstructured data and predictive analytics. They need people who have the skills to
gather and prepare data for analysis in addition to performing analysis.

2. Lack of Data Analytics Skills Within HR

Only one out of three HR managers describes their big data proficiency as either “good” or
“excellent.” For many managers, the problem goes all the way to back to graduate university.
Those who complete an MS in HR Management instead of the MBA don’t experience the same
quantitative rigor.

Also, most companies start by hiring quants for departments directly related to money, finance,
and forecasting. Big data for HR has been an afterthought, not just for HR managers but also for
the C-suite.
3. Insufficient IT Resources for HR Data Analytics

Data analysis is resource-intensive for IT, and many smaller companies simply don’t have the
infrastructure for Hadoop and other analytics programs. Public cloud resources can be a great
help for SMBs that want to analyse their own data, but an SaaS solution—from a company that’s
already done unstructured data analysis—can be even better for companies that lack time,
infrastructure, and in-house expertise.

4. Worries About Privacy and Compliance

When HR collects data on a candidate, particularly data from outside the company, the
department has to consider privacy. Collecting sensitive information, such as personal health
information or information about sexual orientation, can put HR in murky territory related to
protected characteristics.

Laws related to the Fair Credit Reporting Act in the U.S. also come into play. Also, privacy laws
in other countries, particularly EU countries, can become a minefield for HR data.

5. Taking the “Human” out of Human Resources

To many HR managers, the idea of implementing people analytics equals letting computers
decide whom to hire. Although the desire to be ethical by side-lining computers is commendable,
remember that using all available tools to hire the right people for the right jobs in the right
companies is the ultimate ethical achievement for HR. It’s best for employees, shareholders,
society—everyone.

Big data and predictive analytics support hiring, and they help us understand what makes
candidates truly successful. But human beings still make the final decision. Thanks to data, they
make better decisions.

Data Cleaning

Data cleaning is the process of fixing or removing incorrect, corrupted, incorrectly formatted,
duplicate, or incomplete data within a dataset. When combining multiple data sources,
there are many opportunities for data to be duplicated or mislabelled.

When cleaning HR data there are two things need to be considered are data validity and data
reliability.

Validity is whether you’re actually measuring what you need to measure. Does the appraisal
system only measure individual performance, or does it (also) measure who is best liked by
his/her manager? Is data collected evenly throughout the organization, or is it skewed in one
way or another?

Questions you can ask yourself to check for validity, are:

1. Does the data represent what we want to measure?
2. Are there any biases in the way we measured our data?
3. Was the data collected in a clear and consistent way?
4. Are there outliers in the data?
Reliability
Reliability is about measuring the same thing over and over again and achieving the same
result.
When you measure someone’s engagement in the morning you want to have a similar result as
when you measure it again in the afternoon. This is because engagement is a trait that is
relatively stable over time.

Questions you should ask yourself in this context, are:

1. Did we consistently produce the same results when the same thing was measured
multiple times?
2. Did we use clearly documented data collection methods?
3. Were data collection instructions followed each time?

Data Cleaning checklist