Using Big Data to Make Big Decisions on Hiring, Firing, and Retention | TechWell

Using Big Data to Make Big Decisions on Hiring, Firing, and Retention

Predictive analytics has primarily been used to determine the future of the market, consumer trends and demands, and how products might fare in the industry. Now companies could be turning predictive analytics on its axis, forcing the scope inward as they look to use big data in hiring and firing decisions.

There was a point in business where old-school hiring methods prevailed, and someone could get a job with a firm handshake, a well-spoken interview, and maybe a decent reference. Now, it seems that big data has taken over, and the human resources departments are looking to statistical indicators, performance indices, and myriad analytical measurements to determine whom to hire.

Already have a job and don’t think big data will play a role in your business life? Think again. Big data is also being used to determine who gets promotions, pay raises, and even whom the company might choose to let go.

Predictive analytics has become "people analytics," as companies are using algorithms—similar to those once used to determine the market's future—to now determine an employee's career future.

Worried about being judged by factors you’re not sure how to control? Don’t panic yet, because a little research will show that a company trying to measure an employee’s success through tests and "hidden" data isn’t a new trend. For years, companies have used psychological tests, personality tests, habitual judgments, and subjective performance reviews to determine whom to hire and to measure the arc of an employee’s career.

Why the change to big data? An article by Don Peck featured in The Atlantic says big data and algorithms are believed to provide a more accurate assessment of an employee’s personality and fit for the company in terms of both ability and character disposition. In 2010 Xerox switched to predictive analytics as the deciding factor in whom to hire and noticed that not only did the quality of hires improve but attrition also fell by 20 percent and the number of promotions doubled.

The Atlantic’s article points out that some companies noticed the number of women hired increased fivefold for positions traditionally held by men, and minorities were twice as likely to be hired after switching to predictive analytics.

Does your company use big data in its employee decisions? Do you think predictive analytics can provide a better indicator for success than a gut feeling? Tell us in the comments below.

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