Business Communication

Assignment # 03

To determine Business Intelligence solutions for Human Resource Analysis

Submitted to: Mr Hamid Nawaz Submitted by: Shakira Mansoor MBA 2K11-A Date of submission: 8 December 2011

Mind Map

Traditional Outline
Introduction

Benefits of BI
Competitive edge Faster, more reliable decisions Investment in HR top priority

Sources of data Data warehouses and data marts Internal data External data Need for Business Intelligence solutions for Human Resources

Globalization Diversity Increased competition Rapid environmental changes Salaries largest operating expense
Uses of Business Intelligence for Human Resources Workforce plan Recruitment plan

Workforce benchmarking Compensation plan Training and development plan Analysis of what-if scenarios

Soft wares offering HR solutions IBM Cognos Business Intelligence and Human Resource Performance Management Oracle Human Resources Analytics SAS Human Capital Predictive Analytics and Retention Modeling SAP ERP Workforce Analytics Benefits of using BI

Improved performance and productivity Aligned strategies Workforce cost control

Lowest and most effective headcount Highlight weaknesses Commensurate salaries Overcome uncertainties

Conclusion
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Introduction Business Intelligence (BI) refers to computer-based processes used to collect, classify and analyse business data for optimal decision making. It enables the firm to make faster, more reliable decisions and is considered to be the only competitive advantage left with firms in this era of technological innovations and globalization. BI applications and software revenue surpassed $9.3 billion in 2009. Thus, development of BI tools for Human Resources (HR) should be the top investment priority of all firms. Sources of data Data warehouses contain data encompassing the entire enterprise while data marts cover the records of a single department. Thus, HR analysis can be carried out using data from its respective data mart. This will contain both internal and external data. Internal data contains all employee information regarding salaries, benefits, trainings, appraisals, leaves etc. On the other hand, external data comprises of the Bureau of Labor Statistics, industry averages and labor regulations. Need for Business Intelligence solutions for Human Resources One of the most important consequences of globalisation is diversity- due to which managers need to design various strategies for different time zones, cultures and skill levels. An effective HR department may also give a considerable edge over global competitors. The rapidly changing social, economic and political environments are other compelling reasons for adopting BI in HR analysis so that the firm can speedily respond to any external changes. Also, salaries are the largest operating expenses. So in the interest of efficiency, these should be minimized- which is possible by analyzing all the costs and cutting corners where necessary. All this can be done easily using BI. Uses of Business Intelligence in Human Resources BI can be used for several purposes, the most important of which is designing the workforce plan. This entails analyzing internal data like past trends, workforce composition, turnover rates, and then juxtaposing it with external data. For instance, this can be done to forecast the impact of demographic trends on the organizations workforce so that key positions for succession planning can be identified. BI helps in finding the most effective workforce segmentation strategy for the business. Recruitment plans can also be made using BI to ensure that the best employees are hired. Also, it enables the firm to benchmark workforce processes against internal and external thresholds, making performance evaluations a lot simpler.
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The most appropriate compensation plan can be designed using BI so that salaries and benefits are commensurate with job descriptions and industry averages. Also, it will ensure that salaries are both equitable and consistent. Training and development plans made in accordance with the results of BI will improve employee productivity considerably. It is also invaluable for the analysis of what-if scenarios: simulation techniques designed to make sure the firm is well-equipped for dealing with any possible scenario. The critical evaluation of all available data also enables the firm to answer many questions e.g. why did an employee strike occur, how to deal with it if it continues and what will be the results. Soft wares offering HR solutions Certain famous soft wares offering BI solutions for HR are: IBM Cognos Business Intelligence and Human Resource Performance Management, Oracle Human Resources Analytics, SAS Human Capital Predictive Analytics and Retention Modeling and SAP ERP Workforce Analytics. Benefits of using BI in HR The use of BI leads to considerable improvements in organizational performance and workforce productivity. The HR department is no longer a cost center; rather it adds value to the firm. Instead of employing across- the-board cost cutting measures, the organization can find the most productive workers, focus on them and through targeted training and development improve the productivity of other employees too. Organisations, who adopted BI for HR, have an 8% higher sales growth, 2% higher net operating income growth, and 58% higher sales per employee. BI also helps in aligning HR policies with overall organizational goals and policies. It leads to more effective workforce cost control, helps maintain the lowest possible headcount for effective operations, and highlights weaknesses in relevant competencies for job positions. Employee retention issues are also resolved effectively using BI. Salaries are in line with job descriptions and industry trends and environmental uncertainty is overcome. Conclusion The use of BI leads to a higher ROI, minimizes the risk of losing key talent, minimizes hiring costs, ensures salaries are appropriate, and to a large extent, overcomes political and economic uncertainties. Hence, investing in BI solutions for HR should be the top most priority of every firm. Those who fail to avail themselves of this opportunity might even find that their survival is in question.

References Smith, W (2006) Business Intelligence: Realizing the Promise of HR Technology, Benefit Software Inc. Frates, J and Sharp, S (2005) Using Business Intelligence to Discover New Market Opportunities, Journal of Competitive Intelligence and Management, Vol. 3, Num. 3 erbnescu, L (2009) Business Intelligence Solutions for Human Resource Management, Fascicle of the Faculty of Economics and Public Administration, Vol. 9, Special Number An Oracle White Paper (2011) HR Analytics: Driving Return on Human Capital Investment Kapoor, B (2010) Business Intelligence and Its Use for Human Resource Management, The Journal of Human Resource and Adult Learning, Vol. 6, Num. 2 Anon. Business Intelligence and Key Performance Indicators for Human Resource Management, [Online] Available at: http://www.elegantjbi.com/solutions/index.htm [Accessed 4 December 2011] CedarCrestone (20102011) HR Systems Survey: HR Technologies, Service Delivery Approaches, and Metrics, 13th Annual Edition, CedarCrestone, [Online] Available at: http://www.cedarcrestone.com/research.php [Accessed 4 December 2011]