ABSTRACT

Application of Analytics in the area of Human Resource Management to resolve

people management issues and to make an invaluable contribution to the business is
termed HR Analytics or People Analytics or Talent Analytics. It has been recognised
by HR and business leaders worldwide as a potent tool to enhance the performance of
the HR function in organizations. However, there have been many hurdles in the
growth path of HR analytics. HR analytics experts and pioneering organizations have
come up with an explanation for the slower adoption and growth rates. They have also
suggested the factors that can help in enhancing the adoption and effectiveness of HR
analytics. However, there is very little academic research in this area.

Lack of enough empirical research meant that there was no instrument available for
data collection and research. Information was collected from practitioners and experts
in the area of HR analytics for the basic inputs, through focus groups and personal
interviews. A scale was then designed based on these inputs and literature review and
tested for reliability. A questionnaire with a total of 40 questions, including questions
on analytics maturity was designed. The latent factors were identified using
Exploratory Factor Analysis (EFA). A total of five latent factors were identified with
at least three factor loadings each and Eigen values greater than one. They are defined
as Ease and compatibility of technology usage, Return on Investment (ROI)
assurance, Availability of in-house expertise, Ease of Adoption and Effectiveness.
The factors and the relationship among them are established using Structural Equation
Modelling (SEM). As part of SEM, Confirmatory Factor Analysis (CFA) was applied
to establish the measurement model and Path Analysis to establish the structural
model. The final model is in line with the inputs given by HR analytics practitioners
and the literature review. Correspondence analysis was done to understand which HR
function is most likely to use a given HR analytics on the maturity scale.

There is scope to enhance the quality of this research by making it a longitudinal

study to assess the performance of HR analytics over a period. The instrument can
also be strengthened by collecting and analysing data across different industry sectors
like IT and retail. This can help in establishing the reliability and the validity of the
instrument in the future.