Big data is gaining ground as a commonplace concept — and using it can help businesses learn more about their employees. Human resources departments can use data analytics to make a huge difference in all areas of their companies. But, the trick is measuring and analyzing the right data and ensuring employee privacy while doing so.

 

“HR analytics … are important and can be helpful in guiding talent management and hiring decisions,” writes Matt Straz for Entrepreneur. “According to a 2015 report by Deloitte, 35 percent of companies surveyed said they were actively developing data-analysis capabilities for HR.”

 

You can use data to understand what your workforce is capable of, your employees’ capacity and performance, and what recruitment and retention efforts work best. One particularly useful measure: the predictive index.

 

It “creates a behavioral profile and is believed to provide an accurate depiction, or pattern, of people’s core drives and work preferences,” writes Namrata Singh for the Economic Times. “Predictive analytics involves a quick and simple psychometric test to assess the natural behavior of an employee. The results are reviewed and assessed by trained analysts and the report gives a summary of the strong behavior a person is likely to display along with an elaboration of the management and influencing style.”

 

Then, employers can match an employee’s predictive index to the jobs that suit him or her best, Singh writes, and have a better chance of catching an overloaded employee before he or she burns out.

 

You’ll find similar success stories for measuring your employees’ overall skills and performances, writes Bernard Marr for Forbes. But, if you’re not evaluating the right factors, chances are, you’re not making the most of the data available.

 

“What metrics should HR managers hone in on to enhance their strategic importance?” writes Alan Joch for TechTarget. “That’s probably not a question the HR department can answer alone.”

 

HR should work with leaders across the company to identify key business needs, and use related metrics to get information and solve problems. And, as businesses begin to use such data, they must do so carefully, Straz urges. “Employers need to be very conscious of and sensitive to employee privacy at the same time,” he writes.

 

It can be easy to violate employee privacy, especially if you’re working with a vendor to crunch the numbers on your workforce. “The biggest issue is a potential violation of HIPPA or other employee privacy law,” Straz writes. “Here, employees need to opt-in to have their data collected and used. Then, there must be enough data generated by enough employees that employers can’t pinpoint which data belongs to which employee.”

 

And, he urges employers to use data to guide, not make, decisions. “Use analytics carefully to avoid legal issues and mistrust from employees,” he writes, “and use them in conjunction with employee feedback, to make the best decisions possible.”