The Josh Bersin Company, the world’s most trusted human capital advisory firm, has issued a warning to the people analytics profession: embrace AI and reposition as providers of “systemic business analytics” or risk being sidelined.
Despite years of effort, only 10% of organizations are consistently achieving the highest level of impact with their internal people analytics teams. This is concerning because one of the biggest drivers behind HCM software is improving access to people-related data.
It also continues a trend of the gradual acceptance of people analytics as a C-suite tool. Companies have tried to understand the impact of people investments—such as pay, training, mobility, and hybrid work—on the business. This demand has driven the rise of a specialized discipline staffed by data scientists, industrial psychologists, statisticians, and experts in organizational and behavioral sciences.
And while today’s AI-powered HCM systems can understand human capital investments as well as every other financial area, people analytics practitioners still struggle to deliver business-facing, strategic insights.
That’s despite the fact that three out of four organizations have established dedicated people analytics teams, with 73% investing in people analytics technology and 69% of managers utilizing people data to inform their business decisions.
The challenge is that much of this information remains siloed. People analytics leaders are perceived as generating reports that reach only a limited audience. As a result, executives are increasingly gathering information in less structured ways to enable faster decision-making.
To prevent being marginalized, the report advises people analytics teams to transition towards what Josh Bersin Company describes as “systemic business analytics.” This shift would transform people analytics from today’s academic, research-oriented HR discipline into a more practical, action-driven business function focused on prioritizing, quantifying, and addressing the most urgent business challenges.
Systemic business analytics practitioners could more effectively contribute to critical inquiries. Moreover, the advisory firm shows, organizations that have embraced systemic business analytics are:
- three times more likely to exceed financial targets;
- three times more likely to delight customers;
- eight times more likely to accomplish high levels of workforce productivity;
- four times more likely to engage and retain employees;
- nine times more likely to adapt well to change; and
- seven times more likely to innovate effectively.
The study, conducted in collaboration with thought partner Visier, suggests fostering a supportive culture, implementing the right technology, and developing essential skills to achieve high levels of impact in people analytics is necessary. This involves promoting a data-driven mindset and ensuring that access to data is democratized, enabling leaders to utilize real-time insights for informed decision-making. Ultimately, embracing advanced analytics technologies, such as AI and predictive analytics, is vital for effectively implementing systemic business analytics.
“As we approach 2025, people analytics remains a work in progress, even after all the years we’ve been doing it,” says Josh Bersin, global industry analyst and CEO of The Josh Bersin Company. “So it’s essential to take a step back and reevaluate. The silver lining here is that many management decisions within organizations continue to be made without data. This presents a significant opportunity for people analytics to make a meaningful impact, provided it is presented in a manner that resonates more effectively with the business.”
