Success Factors of an HR Reporting System

“I guess the graph is supposed to make the company more profitable, in theory, but no one knows by how much, it’s all made up”, says Ivan, one of the protagonists in Sally Rooney’s latest novel (Intermezzo, p. 102).

What an absolute and devastating verdict. Whereas in fact, from our experience, most organizations are not interested in spending time, financial, and personal resources on establishing a “made up” corporate reporting. On the contrary, we supported companies on their long-term journey towards setting up a reliable and insightful HR reporting system with meaningful key performance indicators (KPIs) that are supposed to help HR make data-driven decisions.

But where to start, especially when your HR’s data literacy is still in its infancy? And what to keep in mind? We derived and present five selected [1] pillars that will make your HR reporting system everything but a game of pretend:

1. Global data requirements that enable insightful people analytics
2. Understanding of local specifics
3. Appreciation for neat visuals
4. Integration with other reporting sources and cross-departmental collaboration
5. Balance between patience and vigor

Please note that in the following, we address the challenges faced by an SME with multiple locations around the globe, with each location having its own local HR team and unique HR admin, payroll, and time management system(s). Effectively, this means that data must be collected from each location’s local system(s) before it can be integrated into one global HR data set. With this in mind, be aware that with a global HR platform (i.e., a global HRIS), not all pillars may apply as outlined below. However, as the focus shifts to using (i.e., visualizing and interpreting) the data provided by a global HRIS, the importance of the second pillar becomes particularly striking. Read on to find out why.

First, from a global perspective, you must specify the data you want to collect. Broken down into practicable detail, this means that you need to be able to say, “Our global HR data set shall include—amongst various others—data field X with possible data field values A, B, and C”.

But how do you know which data fields you need and which data field values they should have?

Doing so requires you to specify the KPIs you want to visualize on the HR reporting dashboards. This means that you need a clear understanding of the end result—or at least its initial look (since no dashboard is stagnant and your KPIs of interest will evolve over time). In other words: Before thinking in Excel tables (featuring data fields and their respective values), ask yourself: What do we as an organization (incl. global and local HR, global and local management teams, as well as functional heads such as the Global Head of R&D or Engineering) want to know about our people? And which (strategic) decisions do we want to make (in a better, more evidential way) based on these insights into our people?

In data analytics in general and people analytics in particular, one can distinguish between four kinds of analyses that enable people insights (adapted from Hillier, 2023 [2]). The following table presents all of them, including their respective, exemplary application to different HR process areas as well as possible actions that HR can consider taking based on descriptive, diagnostic, and predictive insights.

Exemplary Analyses & Insights-Led Actions

Once you know which analyses you want to conduct—that is, once you know what you want to know about your people—you can start specifying the data fields needed to answer your questions. When adding data fields to your dataset, we suggest thinking in clusters. A selection (with no claim to completeness) could be:

• Demographics (e.g., age, gender, nationality)
• Contractual insights (e.g., contract status, full- vs. part-time or permanent vs. temporary employment, tenure)
• Remuneration (in terms of different salary components and their respective amount)
• Organizational insights (e.g., location, function, department)
• Job architecture insights (e.g., job families, hierarchy levels)
• Working time (e.g., overtime balance)
• Absences (e.g., short- vs. long-term sickness, maternity/parental leave, work accidents)

Unfortunately, defining global data fields and data field values isn’t always a bowl of cherries. For example, you might want to know people’s nationalities (to inform your DE&I report), their annual target incentive (to benchmark variable salary components), or their monthly hours spent in short-term sick leave (to explore possible causes, such as an excessive or inadequately allocated workload). However, from a practical implementation perspective, it may not be easy or feasible to report these data on a regular basis and with proper quality.

This shall not discourage you from including such “risky” data fields in your global data requirements. On the contrary: Go ahead, be bold and brave! However, conducting a reality check in advance can spare you from (or at least prepare you for) possible nasty surprises later, when you will be discussing data delivery with each location.

In addition to this people-analytics-driven approach, consider which data fields are needed to maintain other (global) data flows. Examine which other systems have to provide data to or receive data from the HR reporting system. These can be other global HR systems (such as a global system for talent acquisition, if applicable to your organization) and/or the identity management system. Consider the entire (HR) IT infrastructure to avoid essential data requirements “falling through the cracks”.

Once you have defined all required data fields and their associated values, make sure that you know what each data field and data field value mean and what they are good for, that is, why you have included them in your global data requirements. Take as many different use cases into account as possible. The following guiding questions might be helpful:

• How can this data field be plausibly combined with another/others to create a meaningful graph?
• Which decisions can be supported by insights into—e.g.—the distribution of this KPI (e.g., gender, full- vs. part-time employment, annual base pay) across the entire or a meaningful part of the organization (e.g., location, region, functional division, job family)?
• Who can benefit from insights into this KPI?
• How do insights into this KPI affect HR performance and/or service delivery?

Equipped with a profound understanding of your data requirements, it will be easier for you to respond to stakeholder questions such as: “Why are these data needed?”, “Which purpose do these data serve?”, or “Why do I need to make the effort of changing our local system configuration?”

Now that we have addressed the preparation phase of setting up your HR reporting system (i.e., defining and establishing a clear, in-depth understanding of your global data requirements), let us delve into the second pillar of a successful HR reporting: the ability to properly interpret local HR data.

Defining global data requirements means settling on common ground, finding the lowest common denominator across local specifics. Yet, every such standardization, every “zooming out” comes—inevitably—with a certain loss of detail and specificity. However, no global harmonization justifies forgetting about the local details, as they stay relevant when it comes to interpreting data insights.

Sounds abstract? Fair enough. Let’s illustrate this with two examples from one of our recent clients (an SME with multiple locations and their respective local HR teams around the globe).

To conclude, we strongly encourage you to know not only your global data requirements but also the nitty-gritty details of the data you are collecting from all locations incorporated in the global HR reporting system. Your stakeholders will benefit most from an informed, comprehensive, and appropriate (!) interpretation of those pretty graphs they see on your dashboard.

Speaking of pretty graphs: If you still believe that looks don’t matter, now is the time to finally let go of this misconception. With these (properly shocking—we do apologize) news revealed, let’s address the third pillar of a successful HR reporting: developing (or acting out) your appreciation for appealing and easily interpretable data visualization.

We argue that great visual design and user experience are crucial for motivating users to access and engage with the HR reporting dashboard. Thus, we strongly encourage you to research different ways in which a dashboard can be set up—there are multiple resources online that can serve as helpful inspiration!

Make sure to use a clear and intuitive layout. Include enough but not too many visuals on a single dashboard and consider creating multiple dashboard tabs for different KPI areas such as core HR data, absence data, and recruiting insights.

Choose suitable colors, keeping with your corporate identity whilst applying a fitting color coding (for—e.g.—negative vs. positive trends). Make the size of a visual proportional to its significance and informational value. For example, a pie chart showing headcount by gender may not need to take up half of the screen, unlike a more “data-heavy” graph with multiple lines representing the longitudinal development of every location’s gender distribution.

Provide filters and drill-downs so that users can dynamically explore the HR reporting dashboard. But make sure to set boundaries for that “dynamic exploration”: Employee data is sensitive by nature, and certain categories—such as nationality, salary, and absences—are particularly delicate. Thus, dashboard access should be personalized and restricted according to user roles (e.g., group management, local management, local Heads of HR) and further parameters (e.g., location, function). In practice, this can mean that local management is permitted to see a dashboard with visuals based on absence data from its own location only.

Overall, a simple and personalized access to (one or multiple) visually engaging, straightforward HR reporting dashboard(s) can increase the motivation to use those dashboards and make informed, data-driven decisions on their basis.

So far, we learned that we should be experts on both global data requirements and local idiosyncrasies. Also, it is advisable to acquire some (basic) skills in UX design and access management.

Now, thinking outside the box of HR, let’s dive into the manifold opportunities held by a more holistic approach to HR reporting that integrates data from other departments.

To maximize the value of your HR data insights, consider reaching out to other departments and integrating further, non-HR data sources. These can come from …

• … Finance, enabling us to align workforce and financial planning or link financial performance metrics (e.g., revenue, profit margins) to employee turnover or satisfaction
• … Environmental Health and Safety (EHS), providing detailed occupational health data (e.g., incident reports, sick leaves subdivided into types, lost time injury rates) whose associations with—for instance—employees’ participation in EHS trainings can then be investigated
• … Strategy and Corporate Development, delivering environmental and contextual (e.g., geospatial) data that can help scrutinize the interactions between office locations, commuting times, or regional productivity and HR KPIs such as employee satisfaction or hiring success

Beyond adding informational value, setting up automated data flows will reduce manual efforts for those providing and receiving (which ultimately implies transforming and integrating) data. And since data flows can go both ways, your cross-departmental colleagues may equally benefit from receiving consolidated, up-to-date HR data in a stringent data format. A great way to prevent reporting fatigue!

We are aware that such an integrated approach can lead to your HR reporting dashboard becoming more voluminous and complex. But we promise that in terms of both strategic and operational benefits, it will be a worthwhile trade-off.

To wrap this up, let us tackle the fifth and last (but certainly not least) pillar of a successful HR reporting (and life in general…): finding the right balance between taking deep breaths and retaining vigilant perseverance.

Different local HR systems mean different approaches to setting up automatized data reports. Some systems might already provide “out-of-the-box” reports that fulfil all global data requirements. For other systems, reconfiguration may be needed. This process can be simple and fast in some cases but complex and time-intensive in others. In fact, from our experience, the larger the outsourcing and/or system provider a company is working with, the greater do complexity and time demand become (possibly due to—e.g.—a laborious communication between local HR and provider or the provider internally).

Nonetheless, stay assertive as required and push local data delivery if a deadline has been missed. Because any global (HR) reporting is only as good as its local parts—in terms of data quality and completeness. Here (and as outlined above), knowing the “why” (i.e., the reasons behind requesting each global data field) will come in handy, as it equips you with substantive arguments for sending out yet another reminder.

In need of another context to showcase your resilience? Wait no more, as you can prepare yourself to check data quality and plausibility. Very. Often. From divergent date and number formats over decimal points vs. commas to unintelligible data field values—you will encounter many local “curiosities” when trying to harmonize local data delivery based on global standards.

Finally, show grace to different levels of data literacy. Because sometimes, it is both eye-opening and necessary to leave one’s own bubble, where data is on the forefront and visualized (HR) KPIs are a piece of cake to most. Trust us, they are not. This might entail providing educational sessions to those individuals from your local HR teams who are less familiar with using data to inform their daily work and decisions. Such sessions can have the additional benefit of increasing motivation to deliver high-quality data on time (through higher perceived value of data-driven insights). Also, they enable local HR to act as local multipliers, as ambassadors for the global HR reporting workstream, increasing its credibility and perceived relevance across the entire organization. Give thought to conducting such educational sessions at the beginning of the HR reporting project (e.g., in the shape and form of a kick-off workshop). This can highlight the importance of HR reporting, involve local HR stakeholders from the get-go, and support task prioritization later on.

So here you have them: A nowhere-close-to-complete but focal set of five pillars that make a successful HR reporting system:

1. Being an expert for global data requirements
2. Understanding local data specifics and accounting for them when interpreting data insights
3. Pursuing a visually attractive, easily interpretable, and personalized front-end that respects the (natural) delicacy of HR data
4. Incorporating non-HR data to leverage data insights
5. Being patient towards project speed, data quality, and stakeholders’ varying levels of data sophistication, whilst staying assertive when needed

In synchrony, these pillars are fundamental to an HR reporting system that is more than just made up and fancy graphs but can actually lead to valuable, practical insights that impact how global and local HR work on a daily basis.