The fact that banking HR functions may be lagging behind other industries when it comes to adopting data-driven approaches in HR may come as a surprise to some HR leaders. Most believe themselves to already be largely evidence-based. But dig a little deeper and it quickly becomes apparent that banks are starting to be left behind by more sophisticated and nimble competitors and sectors.
Nobody wants to admit that they make their decisions based on gut-feel and intuition alone. So it is perhaps not surprising that banking executives and HR leaders were just as likely as those from other industry sectors to claim that their HR strategy is already ‘significantly influenced’ by data-driven insights. However, our experience and our data suggest that the banking sector may already be falling behind in the maturity, sophistication and application of evidence-based HR. Take, for example, the fact that just half of our banking respondents were able to confirm that they were using advanced analytics or other Big Data tools to link people strategies with organizational goals (only healthcare respondents ranked themselves worse). Or the fact that almost a third of banking respondents admitted that they only use a limited variety of data sources to influence their HR decision-making.
While these percentages may be overall positive within the bank sector, when you compare these results against those provided by technology respondents and the growing gap in maturity starts to become clearer. Seven-in-ten tech companies say they have used evidence-based HR approaches to align their people strategies to their organizational goals. Eight-in-ten say their HR strategies are significantly influenced by a variety of data sources, drawn from across their organization.
Banking HR functions are not only falling behind in the application of data-driven approaches to support their internal clients’ objectives, they are also falling behind in applying insights to improve their own efficiency. In fact, with the exception of healthcare, banks were the least likely sector to say that they had applied advanced analytics or Big Data tools to improve the efficiency of their HR function.