FOM Hochschule für Oekonomie & Management

Hochschulzentrum Bonn
Joseph-Schumpeter-Allee 23, 53227 Bonn

Bachelor Thesis
in “Wirtschaftsinformatik”
to obtain the degree of
Bachelor of Science (B.Sc.)

Title:

People Analytics - An Empirical Analysis on

Advantages and Potentials for Different Company
Sizes

by
Alexander Freimeyer

Supervisor: M. Sc. Andreas Paech

Matriculation Number: 538786
Location and Date: Bonn, 03.11.2022
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Table of contents
1. Introduction and research question 3
1.1 Scientific research question and research purpose 4
1.2 Scientific research method 4
2. Basics 5
2.1 Big data 5
2.2 Business intelligence 6
2.3 Analytics 6
2.3.1 Descriptive analytics 9
2.3.2 Predictive analytics 10
2.3.3 Prescriptive analytics 10
3. People analytics 11
3.1 People analytics terminology 11
3.2. Application cases for PA 13
3.2.1 Attraction and recruitment 13
3.2.2 Onboarding and development 14
3.2.3 Retention and separation 16
3.3 Adoption of PA 16
3.4 Challenges for PA 18
3.5 Legal aspects of PA 19
4. Empirical Study 21
4.1 Methodology 21
4.2 Guideline-based expert interviews 22
4.3 Interview Guideline 22
4.4 Choice of experts 24
4.5 Conducting the Interviews 25
4.6 Analyzing the Interviews 25
5. Interview analysis 26
5.1 Understanding of the terminology 27
5.2 Сurrent state, use cases and experience with PA 27
5.3 Challenges for PA as seen by experts 32
5.3.1 Data privacy protection 32
5.3.2 Data fragmentation and standardization 33
5.3.3 Data quality 34
5.3.4 Resources 35
5.3.5 Competencies and mindset 36
5.4 Proposed solutions 37
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5.5 Future potential of PA 39

5.6 The effect of company size 41
5.7 Potential of PA from a traditional HR perspective 42
6. Conclusion 45

List of figures
Figure 1: DIKW pyramid ................................................................................................ 7
Figure 2: Simplified BA model ........................................................................................8
Figure 3: Stages of analytics ............................................................................................8
Figure 4: Term popularity ...............................................................................................11
Figure 5: Employee lifecycle ..........................................................................................13

List of tables
Table 1: Interview reference chart ..................................................................................26

List of abbreviations
HR: Human resources
IT: Information technology
BI: Business Intelligence
HRM: Human resource management
BA: Business analytics
PA: People analytics
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1. Introduction and research question

During the last decades many business sectors like finance, marketing or information
technology were able to show off successful development based on the adoption of a
data-driven approach. The human resources (HR) sector, however, is once again trailing
behind (Harris, Craig, and Light, 2011, p. 4). Today HR departments are faced with
many difficulties introduced by the changing business world around them. Skill
management has become more important than ever, as old job profiles become
redundant and new ones emerge due to the digital transformation. The digital
transformation itself is a challenge, as HR departments historically often stored their
data in specific non-flexible formats to be used for specific purposes (Andersen, 2017,
p. 3). The recruitment process becomes more competitive, as skilled workers are a
highly sought after resource (Harriott, and Isson, 2016, p. 2). This dynamic landscape
coupled with the advancement in information technology (IT) has led to HR
departments adopting HR analytics or people analytics, in an attempt to jump on the
train of getting value from data-based insights. The use of analytics promises more
reliable conclusions through data in comparison to HR managers relying on their
perceived experience and gut feeling. These in turn allow for a better understanding of
which approaches lead to the best results regarding company performance (Reindl,
2016, p.2).
The adoption of analytics, however, proves difficult, as despite the many great promises
many companies still show little expertise in this area. As people analytics is a young
phenomenon, there is comparatively little literature on it, even less so on its distinction
from other adjacent terms like HR analytics. Another interesting factor that is not
studied at all is how the size of a company affects its ability to adapt to new
technologies and developments. Smaller companies may have the benefit of less
fractured data, while larger companies should possess more options and resources for
the implementation of new processes and technologies. The adoption of people
analytics is a popular subject among companies of all sizes.
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1.1 Scientific research question and research purpose

The developments discussed in the introduction chapter, comprising both the desire and
needs to adopt analytics in the HR environment coupled with obstacles that prevent
many companies from doing so, lead to the discussion of the following scientific
research question:

“What potential does the introduction of people analytics have in a company, and how
does the company’s size affect this potential?”

For a better understanding of this question it can be further divided into the three
following subquestions:

1. Which HR processes can benefit from the adoption of people analytics?

2. Which challenges may prevent companies from adopting people analytics
despite its perceived value?
3. How does a company’s size affect its ability to adopt and successfully operate
people analytics?

The ultimate objective of answering these questions is to provide deep insights on the
circumstances of adopting people analytics in a company, making a contribution to an
understudied area, especially since there is no data on how a company’s size may affect
the potential of people analytics.

1.2 Scientific research method

To answer the posed scientific research question as well as its subquestions a literature
research of relevant publishings, most desirably peer-reviewed articles from scientific
journals are to be performed. Additionally, several qualitative expert interviews will be
conducted to gain further first-hand insight from HR professionals which have
experience with implementing or operating people analytics. Said HR professionals will
be chosen from companies of varying sizes, to better explore the part of the scientific
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research question that deals with company size. The results will then be analyzed and
compared to each other in order to obtain insights on the implementation of people
analytics and provide an answer to the scientific research question.

2. Basics
This chapter serves to establish the fundamental concepts needed for a better
understanding of people analytics. These concepts are then further referred to in
subsequent chapters.

2.1 Big data

Big data is a phenomenon the omnipresence of which could not have gone unnoticed by
anyone during the last decade. According to a report by McKinsey (2016, p. 1) the
amount of all data ever generated by humans is doubling around every three years.
However it’s not solely the sheer amount of data that big data is defined by. According
to Adrian Merv the grown diversity of data is also of utmost importance, at least from
an analytical standpoint. In his 2014 paper Fasel (2014, pp. 388-389) makes a
connection between these properties of big data and the three V’s Doug Laney described
in a Meta Group paper on data management in 2001, although he didn’t use the term big
data yet: data volume, data velocity and data variety. While the ever increasing data
volume has already been addressed in this chapter, variety and velocity can be further
elaborated on. Data velocity describes the rate at which data is generated and interacted
with, which has been also drastically increasing with more and more businesses and
individual users getting involved with the internet since Web 2.0 became a thing. As for
data variety, Laney (2001, p.2) focuses his attention on different data formats and their
compatibility, speaking out his concern that this would become the key problem factor
for data management in the future. Fasel (2014, pp. 388-389) on the other hand shifts
this focus to the quality of data, as data becomes more elaborated and this increasing
data granularity allows for more comprehensive analysis. Chahal, Jyoti and Wirtz
expand these criteria by adding three more V’s - veracity, value and variability, although
these somewhat overlap with data velocity, dara variety and among themselves. As
such, data veracity describes how accurate and reliable extracted data is, with its sources
and structure being the most important aspects. Data value, as the name suggests,
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describes how much profit the extracted data can bring or how useful it can be to an
organization. Data variability is, contrary to what the name suggests, mostly linked not
to data variety, but to data velocity. It describes how the inconsistency of data
availability as well as an uneven distribution shape the complexity of interacting with
big data (Chahal, Jyoti, and Wirtz, 2019, p. 14).
These additions to the earlier definitions shift the focus on how data is ubiquitous and
always in motion, and on how possible benefits dictate a company’s approach to big
data.

2.2 Business intelligence

Business Intelligence (BI) is a concept which has its roots in early attempts to improve
the effectiveness of management through information technology (Kemper, Baars and
Mehanna, 2010, pp. 1-2). The term itself has been subject to some iterations. It was first
used by Luhn in 1958 (pp. 314-319), who saw BI as a system of automatic information
distribution inside an organization. Since then, the term’s definition has been expanded
by different authors (like Howard Dresner in 1989 and Solomon Negash in 2004,
mentioned in the next source) to encompass the management of information with the
purpose to improve strategic decisions and a business’s performance as a whole
(Grossmann and Rinderle-Ma, 2015, p. 1). A more recent definition is given by
Chamoni and Gluchowski, who describe BI as systems that evaluate internal and
external data to assist management and improve business decisions (Chamoni and
Gluchowski, 2004, p.119). This in turn connects BI closely to data analytics,
incorporating Online Analytical Processing (OLAP) and Data Mining (Kemper, Baars
and Mehanna, 2010, pp. 3-4). According to Laursen and Thorlund (2010, p. XXI), in
today's market BI usually stands for reporting tools and focuses on the technical aspects,
while business analytics, which itself should be a part of BI, more accurately describes
the process of going beyond just reporting and incorporating strategic decisions. The
term business analytics will be further discussed in the following chapter.

2.3 Analytics
Analytics is a broad term that encompasses different applications and subdisciplines,
which leads to many definitions being present. According to Baesens, De Winne, and
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Sels (2014, pp. 7-8), who also compare analytics to data science and data mining, the
common denominator is finding relevant information in a given data set. Fitz-enz and
Mattox (2014, p. 2) criticize the restrictive view of treating analytics as an equivalent to
statistics. They define analytics as an intellectual approach, the combination of
perceiving and understanding the interactions between the acting components of a
system and the knowledge on how to process them. Cooper’s (2012, p. 2) criticism on
the other hand targets the circumstance that the term has become too overused and as
such it is difficult to find a clear definition. He further criticizes the approach of
reducing analytics to the process of forming a decision based solely on data, and
expands his definition to further include the process of examining a problem and using
data to extract knowledge, which then can be applied to find a solution for said problem.
Cooper also elaborates on the extracted knowledge, which in his opinion needs to be
actionable - which he describes as leading to practical action by a thinking person,
based on his or her own experience.
These definitions lead back to the classical DIKW pyramid (Figure 1), which describes
the structural relationships between wisdom, knowledge, information and data. When
applied to Cooper’s definition, analytics merely structures data to gain information,
while further human processing is needed to gain knowledge from it.

Figure 1: DIKW pyramid (own depitction)

The term business analytics (BA) refers to analytics being applied to a business
enterprise. While this concept isn’t new, many companies started taking it seriously,
investing in it and making it a central part of their strategy only at the beginning of the
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21st century. Especially BA’s connection with a company’s strategy needs to be

emphasized as without strategic goals in mind BA any possible positive effects either
won’t be sufficiently supported, or might even clash with one another (Laursen and
Thorlund, 2010, pp. XI-XIII). According to Laursen and Thorlund (2010, pp. XIV-XV)
BA is defined as an information system, not necessarily an IT-system. The deeper
meaning of this is that BA is defined as a process that is done by humans, while IT is
only a supporting element, and never the central aspect. Certainly, with all the amounts
of data that need to be handled in present times, the absence of an IT-system is almost
unthinkable. Still, such solutions only support business processes with human decision
making at their core. Laursen and Thorlund (2010, p. 2) expand on this idea,
introducing their BA model, which shows BA as consisting of interacting layers, with
management focused on business and strategy requesting and getting information
provided from IT specialists working on data, while analytics connects both worlds in
the middle (Figure 2).

Figure 2: Simplified BA model (own depiction based on Laursen and Thorlund, 2010,
p.2)

Another view is given by Reindl and Krügl, who focus on how especially external data
is used to understand which factors lead to success and apply this information to one’s
own company (Reindl and Krügl, 2017, p. 16).
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To further explain how analytics operates it is necessary to dive into its subcategories.
Most authors agree on three main processes, which together form analytics as a whole:
descriptive analytics, predictive analytics, and prescriptive analytics (Figure 3).

Figure 3: Stages of analytics (own depiction)

2.3.1 Descriptive analytics
Descriptive analytics provides a basis for other analytics processes and focuses on the
past - from distant to recent, as well as flowing into present data. The main process
comprises structuring data, describing trends, correlations and patterns found within it,
and visualizing the result (Fitz-enz and Mattox, 2014, p. 3). The most common
techniques found in descriptive analytics are data mining, data queries and data
dashboards, with the former two dealing with extracting and structuring data, while the
latter is a method for summarizing data and visualizing it according to given
requirements (Camm et al, 2020, p. 5). While the goal of descriptive analytics is to
create an understandable depiction of what surrounding data represents, its deeper
purpose is usually to improve existing processes and increase efficiency (Fitz-enz and
Mattox, 2014, p. 3).
A part of descriptive analytics that sometimes is pointed out as a separate entry in the
list of main analytics processes is diagnostic analytics. Some authors prefer to separate
it from descriptive analytics as its own process, as it aims to not only describe what
happened in the past, but also the reason why it happened (Deshpande, Sharma, and
Peddoju, 2019, p. 75).

2.3.2 Predictive analytics

While descriptive analytics is mostly concerned with the past, predictive analytics does
the opposite, focusing on the future. Past and current data certainly is still the basis, but
the objective of predictive analytics is, as the name suggests, to predict future events
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and outcomes. This is achieved through probability calculations based on events that
have already occurred (Fitz-enz and Mattox, 2014, p. 3). A prominent area where
predictive analytics is used by companies is risk assessment. With regard to techniques,
data mining is also oftentimes used in the same context as in descriptive analytics,
namely to extract and structure data, while the actual predictive part mostly resorts to
modeling, primarily using simulation and linear regression. As such, statistics are
heavily involved with predictive analytics (Camm et al, 2020, pp. 5-6).

2.3.3 Prescriptive analytics

Prescriptive analytics shows some similarities to predictive analytics, as it also predicts
future outcomes, however it is different in a substantial way, as it goes beyond the scope
of predictive analytics, providing possible decisions and courses of action as its result
(Fitz-enz and Mattox, 2014, p. 3). It can be argued that the focus of this process is on
the present rather than on the future, as it offers possibilities on which actions should be
taken at the given moment to achieve the desirable future. Structurally prescriptive
analytics combines prognoses with rules, which result in recommendations on what
actions to take in given scenarios. While modeling is heavily used like in predictive
analytics, prescriptive models are usually so-called rule-based models. Simulation also
usually goes hand in hand with optimization in this case, as resulting decisions can be
weighted, also taking into account preferences of the people responsible for the
decision-making (Camm et al, 2020, p 6).

3. People analytics
In a broad sense, people analytics is the concept of analytics applied to an HR
management environment. While this is an easy connection to make, an actual
definition proves more troublesome, as different authors and professionals perceive the
topic from different points of view. Most professionals in this field tend to associate
people analytics with either different stages of HR metrics, or optimized
decision-making based on predictive analytics (Falletta and Combs, 2020, p. 52).
However, contrary to the commonly shared opinion, people analytics goes beyond
simple metrics. The other common opinion is more accurate, as people analytics is
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heavily involved with strategic decisions based on analyzed internal and external data
and aimed at affecting business output in a positive way (Marler and Boudreau, 2016, p.
13).

3.1 People analytics terminology

The terms people analytics and HR analytics are oftentimes used interchangeably, not
only with each other, but also with workforce analytics, talent analytics, human capital
analytics, or even human resource intelligence (Reindl and Krügl, 2017, p. 15). This is
also true for scientific literature, as even in a paper focused on comparing definitions of
HR analytics by different authors, the said definitions make use of multiple of the
aforementioned terms: HR analytics, people analytics, workforce analytics (Falletta and
Combs, 2020, p. 53). To get a better understanding of this confusion, the history of HR
analytics should be examined. Metrics have been applied to HRM in some shape or
form for the better half of the 20th century (Marler and Boudreau, 2016, p. 1). While
metrics differ from analytics in the fact that they merely portray data in a summarized
and comprehensible way, not actually describing the underlying relationships and
patterns, they still are considered a precursor to analytics and an integral part of the
analytic process (Van den Heuvel and Bondarouk, 2017, pp. 8-9). The advent of IT and
subsequently HR information systems in the 1980s started facilitating the evolution of
electronic HRM by the early 21st century (Van den Heuvel and Bondarouk, 2017, pp.
3-4). This slow adoption of IT in HRM coupled with the increasing importance of big
data has led to analytics slowly getting introduced into HR around the same time (King,
2016, p. 488). It took another decade for HR analytics to finally garner wide popularity,
and this is also the point when terms like workforce analytics and people analytics
started being used more commonly (Van den Heuvel and Bondarouk, 2017, p. 5).
Especially people analytics rose in popularity around 2010 and continues to rival HR
analytics at least in search interest, while the presence of other adjacent terms is
comparatively moderate and can be neglected (Figure 4).
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Figure 4: Term popularity (Tursunbayeva, 2018, p. 226)

As people analytics usually appears in the same context as HR analytics it may be

considered a trend term, carrying the same core information and differing mostly in the
way it wants to present itself (Van den Heuvel and Bondarouk, 2017, p. 5). There is but
one other aspect that is associated with people analytics, but rarely given specific
attention to by classical HR analytics, and as such, can help to distinguish both terms -
which is employee satisfaction as a driving factor (Tursunbayeva, Di Lauro, and
Pagliari, 2018, p. 231). As such, the real distinction between HR analytics and people
analytics is that the latter refers not only to the employee role, but to the person behind
it as well. However, since this is mentioned in hardly any literature and employee
satisfaction is a well-known topic in HRM as a whole, this paper will follow the trend of
using the terminology interchangeably. To avoid further confusion, from this point on
the term people analytics (PA) will be used in all cases, referring to any of the adjacent
terms. It should be noted, however, that further sources may still be using other
discussed terms.

3.2. Application cases for PA

HR departments have always been dealing with personal data in operational processes
like recruiting. Based on this, as well as the given definition of PA, it can be assumed
that PA can be applied in both strategic and operational processes in HRM. To describe
these processes and how PA can affect them in a coherent manner they can be assigned
to the six stages of the employee lifecycle (Cattermole, 2019, pp. 258-261; Figure 5) .
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Figure 5: Employee Lifecycle (own depiction, based on Cattermole, 2019, pp. 258-261)

3.2.1 Attraction and recruitment

The most important tasks in HRM fall into the category of personnel attraction and
personnel recruitment, as without the influx of new employees all subsequent stages
would become obsolete. Both recruitment and personnel attraction make use of industry
analysis to make a current picture of the labor market to have a better understanding of
the supply and demand of relevant job profiles, ultimately gaining an advantage in the
war for talent. Descriptive analytics is an easy fit for this task (Ben-Gal, 2019, p. 1439).
Personnel attraction usually also includes employer branding, a process that describes
the marketing of a company as an attractive employer. This is generally achieved by
improving employee experience internally, so that content employees will recommend
their employer to people outside the company, as well as by creating a prominent and
positive company image externally (Ontrup et al, 2019, pp. 17-18). PA offers many
options to optimize employer branding. One clear benefit is that employee satisfaction
can be highly improved by analyzing internal data. Another possibility that PA offers is
targeting, which, similar to analytics in marketing, ensures that the relevant target group
can be reached more effectively, essentially extending the reach of an employer
branding campaign (Ontrup et al, 2019, p. 24).
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When it comes to recruiting, PA can not only be applied in the search for candidates, as
stated before, but also for narrowing down the list of applicants or even automated
assessment centers (Ontrup et al, 2019, pp. 44-47). Another benefit is that applicants
can also profit from the added flexibility (Ontrup et al, 2019, p. 49). The overall result is
a better efficiency coupled with more objective results for recruitment (Ontrup et al,
2019, p. 55). The latter can present a problem in traditional recruitment, as interviews
can be influenced by the oftentimes unintentional prejudices, opinions or assumptions
by the interviewer (Blackman, 2017, p. 191). Such fallacies can be avoided with the
help of a data-based approach provided by PA. Predictive analytics are also used to
evaluate the possible performance of applicants or compare hiring sources among other
things (Deloitte, 2017, pp. 40-41). To sum this segment up, PA brings many innovations
to recruitment, which may shape the whole process in the future. In employee attraction
PA leads to more successful campaigns, demonstrating a great ROI (Reindl, Krügl,
2017, p. 197).

3.2.2 Onboarding and development

While the employee lifecycle, as the name suggests, focuses on the different stages an
employee goes through in a company, the stages of onboarding and development also
represent the main bulk of an employee’s time within said company. As such the main
organizational HR processes can be discussed here. One such process is employee
performance evaluation. It pursues several goals, as it not only generates data to be used
in personnel measures like salary increases, but also provides insights in possibly
needed trainings, while also acting as a huge motivational factor for employees (Ontrup
et al, 2019, p. 112). As employee performance evaluation both uses and generates
substantial amounts of data, PA can be applied here to a great extent as well. Examples
for successful implementation of PA in this process include systems that collect
performance data in real time and can be used as a communication tool to get instant
feedback (Ontrup et al, 2019, p. 115), or the use of data models which predict which
employees should be promoted (Ontrup et al, 2019, p. 118). In general, PA coupled with
evaluation promises better transparency and more fairness for the employee, while the
employer can profit from more continuous performance data, which in turn leads to a
more comprehensive evaluation itself (Ontrup et al, 2019, p. 119).
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On the other hand, more frequent or continuous data collection may be an incentive for
employees to increase their performance. The aforementioned possibility to get instant
feedback is another benefit, as statistically employees prefer more frequent feedback
(Deloitte, 2017, p. 66).
A process that goes hand in hand with performance evaluation is performance
management. It comprises many factors, but its main idea is the continuous
development and motivation of employees. The processes that are used to achieve this
include, but are not limited to, further education and skill management, engagement
management and organizational design and engineering. Skill management is a
self-explanatory term that describes the development of employees’ skills and
qualifications (Wetzler, Faix, Buchwald, 1991, p. 11), but also their deployment and
allocation of tasks in the strategically most profitable way. Engagement management is
also a term that mostly describes itself, as its aim is to create employee engagement,
strengthening the employees’ connection to their own work and their employer,
ultimately resulting in better productivity (Ontrup et al, 2019, p. 89). The potential of
PA in engagement management is similar to its potential in performance evaluation, that
being a continuous monitoring of engagement, as well as a possibility for employees to
give feedback at any time (Ontrup et al, 2019, p. 98-100). Closely related in its goals,
which are an increase in employee performance and satisfaction, but different in its
methods is organizational design and engineering. The main area of approach for this
process is the employees’ working environment, meaning not only their organizational
structure, but also their physical environment (Olguín-Olguín and Pentland, 2010, pp.
72-73). PA can be introduced in this context to collect data on the employees’ social
behavior and the surrounding environmental conditions, like temperature or
luminescence level, to propose an optimized working environment (Olguín-Olguín and
Pentland, 2010, pp. 77-78).

3.2.3 Retention and separation

Another important HR process that can benefit from PA is strategic workforce planning.
As the name suggests, it can be summed up as the planning of a company’s workforce,
taking into account how the current workforce correlates to possible future workforce
needs, ensuring that required employees or job profiles are available at any given
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moment (Ontrup et al, 2019, p. 64). This is also supported by retention management and
attrition management, two processes focussing on the retention of personnel and the
management of leaving personnel. While retention management is closely related to
engagement management and employee satisfaction, attrition management deals with
the often unpredictable loss of workforce, which in the worst case can go hand in hand
with the loss of key skills that are hard or expensive to replace (Adeyemo and Alao,
2013, p. 18). PA can support this process, collecting and analyzing data on the
circumstances under which employees leave, making this problem more predictable
and, as such, increasing the company’s ability to react to or even prevent the loss of key
performers (Alduayj and Rajpoot, 2018, p. 93). Strategic workforce planning also loops
back to employee acquisition. As such PA can be applied in all stages of strategic
workforce management, from the planning of personnel entering and leaving the
company, to the assessment of key skills and their continuous availability (Ontrup et al,
2019, pp. 70-71).

3.3 Adoption of PA
The adoption of PA is a complicated task for many companies, as it is coupled with
various obstacles and the mandatory adoption of an analytical mindset. As previously
established, PA is a rather young discipline that only started getting a foothold in HRM
in the last decade. However, contrary to the sharp rise in popularity of the term itself,
the actual implementation of PA in companies occurs at a much slower pace. A study
conducted by Deloitte (2014, p. 117) in 2014 shows that 78% of companies with over
10.000 employees that have been surveyed perceived PA as at least important, while
only 7% of them were actually confident in their own capabilities on that matter.
Another study from the same year, this time by TDWI (Halper, 2014, p. 9), shows only
17% of surveyed companies employed predictive analytics, with only another 22%
considering doing so in the following few years. Fast forward seven years and the
picture looks moderately better: a 2021 survey by Oracle (2021, p.4) shows that only
34% and 43% of the participating companies of different sizes employ some relevant
form of predictive and prescriptive analytics respectively. Descriptive analytics
performs better, being used by 68% of the respondents. These statistics show that the
will to use PA is certainly there among companies. There is also no lack of incentive, as
 17

companies that successfully implement PA show to be twice as likely to achieve better

results in recruiting and three times as likely to save expenses and increase their
efficiency (Deloitte, 2013, p.2). This brings up the question why the adoption of PA
proves that difficult for many companies. The already mentioned 2014 study by Deloitte
(p. 117) also shows that 45% of surveyed companies see themselves as not ready to
implement PA yet. While indicative of qualitative introspection, this is also closely
correlated to the first barrier in adopting PA. As PA is relatively new and unexplored,
many professionals have an insufficient understanding of what it actually is and which
steps should be taken next. This phenomenon is true for many innovations and is rooted
in the psychology of preferring to stay in a comfort zone, but shows another dimension
for PA specifically, as the relevant analytical and mathematical skills aren’t as prevalent
in a traditional HR environment (Vargas et al, 2018, pp. 13-15). To effectively combat
these problems a management team focused on innovation should lead with a positive
example, be transparent and elaborative on how innovative PA is and which benefits it
brings, as well as provide the necessary training and education (ibid).
According to Marler and Boudreau this should first and foremost include analytical
skills, which modern HR employees should have at least a basic competence in, and
ideally become deeply familiar with (Marler and Boudreau, 2017, p. 17). This approach
is optimal and can’t simply be replaced by advanced software and the hiring of a few
dedicated analysts, as with the inevitable digital HR transformation it is essential
especially for HR employees to obtain an analytical mindset and deep knowledge in
their own working environment to then apply it to the working environment of their
personnel.
Secondly, analytical skills should be supported by expertise in relevant IT solutions. PA,
as any form of analytics, is built on information systems that are needed to handle the
emerging amount of data (Marler and Boudreau, 2017, p. 18). Finally, Marler and
Boudreau emphasize the leadership’s role, as to properly manage the introduction of PA,
providing the necessary resources and making course corrections if some things don’t
go according to plan the first time (ibid). Again, as PA is still a nascent discipline,
innovative leaders are required to explain related processes and inspire employees to
contribute to the undertaking (Green, 2017, p. 2).
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The consequences of trying to introduce PA without first adopting analytical skills

represent another factor that may scare off companies from attempting it in the first
place. A lack of analytical skills carries the risk of focusing on wrong metrics and
following perspectives that aren’t fit for an HR business, resulting in the inability to
form a competent HR strategy. This in turn leads to the employee experience being
actually worsened, without providing any tangible benefits in exchange (Angrave et al,
2016, p.1)
A competent strategy that is built on a unique understanding of one’s company and its
specific conditions is the key to a successful adoption of PA. This should include
deciding which projects can bring actual meaningful results for the business and which
ones may be unnecessary, regardless of how hyped they may be in the industry (Green,
2017, p.1). To develop such a strategy two things should be given explicit attention to:
what the employees’ contributions to the business are, as well as what data is critical to
the success of said business and the context around this data. Based on this, relevant
metrics can be defined and employees that make the most strategic impact on business
performance can be identified and grouped into talent segments. They can then be
allocated to tasks that give the most strategic benefit according to these metrics. Once
these factors have been examined a company can further experiment with which
approaches result in the highest increase in performance, and how the output of the
talent segments can be optimized (Angrave et al, 2016, pp. 3-4).

3.4 Challenges for PA

While PA can be applied to serve most HR processes and as such benefit HR as a
whole, there are still some obstacles that impede a successful implementation of PA and
later on its successful operation. One such factor is a general mistrust among employees
towards PA, which is rooted in the fear of being monitored by the employer, as well as
being treated unfairly by the data-driven approach. This fear is combined with poor data
quality, which can lead to a large number of employees being affected by decisions
based on wrong or partially wrong data (Cimbaljuk, von Brook, and Schreck, 2019, pp.
4, 5). Data quality in general is another huge challenge PA is facing. This is partly due
to many companies not investing in a proper data management system, which leads to
lacking, redundant, and unstructured data (Minbaeva, 2018, pp. 2-3). A reason for this
 19

poor structuring of data oftentimes lies in the fact that many older companies still store
and manage data in the same way they did decades ago, before adapting a data
management strategy became a prominent subject, or have adapted their data storage
and management to fit specific processes and not being of much use for anything else
(Levenson and Fink, 2017, p. 10; Andersen, 2017, p. 3). In some cases this can lead to
data being scattered across multiple data systems. The resulting data fragmentation
makes it difficult to extract reliable insights (Dringus, 2012, p. 92).
Another challenge for PA is the adoption a strategic or analytical mindset, which is
needed to understand and strategically use insights provided by PA, but is not that
common among HR professionals (Andersen, 2017, pp. 3-4). This often coincides with
a generally poor planning of PA, which is rooted in HR having been focused on various
metrics in methods in the past, the legacy of which may bring confusion into a modern
PA approach (Levenson and Fink, 2017, p. 4).

3.5 Legal aspects of PA

One huge obstacle that is greatly affecting anything related to data collection especially
for businesses operating in Germany is data privacy protection. As PA is based on the
collection and processing of especially personal data, this obstacle becomes all the more
relevant. This chapter deals with laws and regulations on data privacy protection and the
legal circumstances around the application of PA in the specific context of the European
Union. Data privacy protection in the EU is regulated by the General Data Protection
Regulation, short GDPR, which has been established in 2016 and has fully taken effect
in 2018 (GDPR, Art. 51). The GDPR applies to all companies based or operating in the
EU and serves to protect the personal rights of individual persons. The regulation states
that all data may only be collected with the consent of the affected person. However,
this consent can be revoked by any individual at any time (GDPR, Art. 51).
Non-compliance with the GDPR can lead to severe consequences and a fine of up to
four percent of the company’s global revenue (Petry and Jäger, 2018, p. 190). The legal
basis of data privacy protection applies to the storage, processing and interpretation of
personal data. As PA uses all three of these processes, it is always necessary to check
which regulations are relevant and what exactly is permitted under which surrounding
factors (Reindl and Krügl, 2017, p. 73). The most important aspect of these permissions
 20

is the obligation to inform the employee about all personal data that is collected or
processed about it. This subjects of this information are rather extensive and most
importantly include what exact data is collected and what purpose it serves, who is
responsible for the data processing and what the possible consequences and the
company’s reasonings for the data collection are, as well as contact data for the data
protection officer, and other entries, depending on the exact situation (Reindl and Krügl,
2017, p. 84).
As data systems aren’t exempt from these regulations, it is of utmost importance that
they provide a reliable and secure handling of data and accidental violations of the
regulations through system malfunctions can be avoided. For this reason the concept of
Privacy by Design was developed, which describes a protective measure based on the
implementation of data privacy protection in the technology of emerging data
processing systems right from the start. The concept of Privacy by Design includes
seven foundational principles(Cavoukian, 2010, pp. 2-5)

1. The implementation of privacy measures must be proactive, rather than reactive

and serve as a preventative factor
2. Data protection and privacy must always be implemented as the default in a
system, not an optional feature
3. Data protection and privacy must be embedded in the initial design of the system
4. Data protection and privacy must be implemented in a way that does not impede
the full functionality of the system
5. Data protection and privacy must implemented in a way that ensures continuous
security during the whole lifecycle of the processed data
6. Visibility and transparency about the processing and management of personal
data must always be ensured
7. User privacy must always be ensured the requirement of consent, access to own
personal information and integrity of the data

To sum it up, with correct management PA can certainly function in an environment

shaped by heavy data privacy protection regulations, provided the analytics process
follows all the established rules. However, the strongest negative factor that comes from
 21

this obstacle, is that the implementation of PA has to overcome another layer of

bureaucratic difficulties, possibly deterring some companies from the attempt, as they
may deem it too troublesome.

4. Empirical Study
To answer the scientific research questions listed in chapter 1.1 an empirical study needs
to be conducted. The goal of this study is to analyze first-hand experiences HR
professionals have with PA or adjacent processes. The results of this data collection are
then to be compared to the insights provided by the literature review from the
theoretical part of this thesis, ultimately describing how companies are affected by a
possible adoption of PA. As currently PA is still in a nascent stage, a quantitative study
with representatives from a substantial number of companies is unreasonable as the
method of choice, in addition such studies (Deloitte, TDWI, Oracle) have already been
referred to in the theoretical part. Instead, a qualitative empirical study based on
comprehensive expert interviews with HR professionals is the preferred method that
promises the most valuable results.

4.1 Methodology
Qualitative methods involve understanding, describing and interpreting connections or
causalities, based on a deeper understanding of a limited number of cases.(Häder, 2019,
p. 67).They also are less rigid than quantitative methods, allowing for a more flexible
approach to the extraction of insights, and represent an inductive approach, meaning
that said insights are used to derive new statements, not prove existing ones. This fits
well with the case of PA, as it means the research of a phenomenon that is not well
studied. Qualitative methods usually provide a deeper, but narrower understanding of
the researched subject. At the same time the generation of useful information is more
laborious, as it is achieved through interpersonal communication. The chosen scientific
method is a series of guideline-based explorative expert interviews.
 22

4.2 Guideline-based expert interviews

The guideline-based expert interview is a type of interview that follows a prepared list
of questions in an unconstricted form. These questions are only the foundation of the
interview, as such the interviewer is expected to steer the interview in the desired
direction and follow up on important insights. According to Misoch (2019, pp. 27-28)
this type of interview is a half open interview, which means that it takes the middle
ground between a standardized interview, most commonly used for quantitative studies
and giving little to no free space to deviate from the prepared questions, and an open
interview, which allows the interviewee to take the lead and express themselves freely
on whatever they see as relevant to the discussed subject. The guideline-based interview
is the most common form for an expert interview, as it allows the interviewer to get
more specific answers, as well as adapt the structure of the interview to the specific case
of the interview partner (Gläser and Laudel, 2009, pp. 112-113). A guideline-based
expert interview also usually differs from a quantitative interview in that it uses open
questions, which allow the interviewee to share more and deeper thoughts on the
discussed subject. A successful guideline-based expert interview comprises two
components. First, the guideline must be developed in a manner that ensures that all
important aspects of the subject are addressed. Second, a group of experts must be
found and decided on, that hopefully can provide relevant insights about the researched
subject.

4.3 Interview Guideline

The guideline has both a controlling and a structuring function for the successful
conduction of an interview. It ensures that the dialogue doesn’t steer too far away from
the predefined questions and topics. The structure of the guideline can vary in how
detailed it is, ranging from comprehensively formulated questions and subquestions to
research subjects being described by only notes and keywords. Due to a lack of
experience with this kind of interview the chosen structure is based on fully formulated
questions, so as to not forget any important details indicated by keywords when
conducting the interview. Additionally, according to Misoch (2019, p. 66), an interview
guideline should adhere to the three principles of qualitative research outlined by
Reinders (2005, pp. 31): openness, a process-driven approach and communication.
 23

Openness describes that the guideline should not focus on established hypotheses, but
rather be open for new information provided by the interviewee. Additionally, the order
of questions can be adjusted mid-interview to better follow the interviewee’s line of
thought. A process-driven guideline is characterized by the assumption that any insight
isn’t static, but rather dynamic and can be elaborated on by posing follow-up questions
about past developments, changes, and circumstances surrounding the subject. The
principle of communication describes that since interpersonal communication is the
main method of extracting knowledge from an interview, it is of utmost importance that
the interviewer and interviewee understand each other as best as possible, to avoid
possible confusion. For this reason the chosen language must be simple and adequate
for the subject, the questions, too, must be free from ambiguity (Misoch, 2019, pp.
66-68).
In order to answer the given scientific research questions, the constructed interview
guideline focuses on six main topics, divided into introductory questions and advanced
questions. The introductory section is aimed at the expert’s area of work, as well as his
or her understanding of PA and experience with it. It also brings up the question about
the dimensions in which the experts operate, aiming to help in differentiating results by
size or team size. The advanced section then covers the topics of data collection and
data evaluation, exploring questions such as how data is exactly interacted with and
what strategic results can be described. It also includes the topic of perspectives and
challenges PA is facing in the present and future. When interviewing HR experts who
are not specialized on PA or any form of data analytics, the guideline is changed to be
less reflective of the established use of PA, and more explorative of the potentials the
experts see in an adoption of PA for their field of work.
These questions have been prepared in accordance to the principles listed above. As
eight interviews have been conducted and there was no prior experience to this kind of
work, the guideline has been slightly adapted between the interviews to make some
questions clearer and/or more elaborative. The initial and final versions of the interview
guideline can be found in the appendix.
 24

4.4 Choice of experts

The second pillar of successful expert interviews is the choice of experts who can
provide the most valuable insights into the researched subject. The quality of
information gained from an expert interview is directly dependent on the experts’
professional and personal views. The number of interviewed experts should also not be
set too low, as different experts can usually have different points of view on the same
subject and as such a more comprehensive picture of the subject can be created (Gläser
and Laudel, 2009, p. 117). Prof. M. Sc. Andreas Paech suggested seven to eight expert
interviews as a solid basis for subsequent empirical analysis. In the first phase the
search for experts has been conducted predominantly through colleagues and
acquaintances working in HR departments. After a number of experts was found and
contacted in this way, further experts were searched for in professional web sources,
mainly LinkedIn. Finally, after the first interviews some of the experts have provided
contact details for other experts they personally know in the same field of activity. All
chosen experts are professionals working in HR departments or HR-adjacent
departments, ranging from business partners to mostly PA project managers to a product
manager supervising a PA service platform. Five of the seven experts (#1, #3, #4, #6,
and #7) also share in common that they are working for different segments of Deutsche
Telekom AG. During the interviews it was discovered that not all experts have a direct
connection to PA. Initially eight interviews were conducted, but one of them showed no
relevant insights and as such was cut after less than ten minutes and was not
transcripted. From the remaining seven experts two did not provide much useful
information for the core questions due to a lack of personal experience with PA,
however, it was decided to keep both of them in, as they can provide ideas for the
adoption of PA from the perspectives of HR departments that had not previously
touched on this subject.

4.5 Conducting the Interviews

The expert interviews were conducted in a time period between September 22nd and
October 18th, 2022, with a last minute interview being added on October 27th. All of
them were carried out via video calls with a recording of the audio in agreement with
the respective experts. Apart from the one interview that was cut short, all interviews
 25

took between 27 and 39 minutes, with most of them exceeding the 30 minute mark. In
all cases it was possible to properly finish the expert interviews in the available time.

4.6 Analyzing the Interviews

After an interview has been completed the audio recordings are transcripted into text
files which are then used as a basis for the empirical analysis. During the transcription
the experts’ names and most references to their companies, or, in the case of Telekom
employees, their segments, are anonymized based on a suggestion by Prof. M. Sc.
Andreas Paech. In the next step, the transcribed interviews are studied and color coded,
referring to when the experts say something relevant to any of the topics that need to be
analyzed, namely the understanding of PA terminology, use cases and the current status
of PA implementation, encountered difficulties, used software, possible future
developments and potential, as well as company size and the count of affected
employees. The results are then summarized in a reference chart (Table 1) to make it
easier to go from topic to topic between the interviews. The interviews are not analyzed
on a single basis, but rather the presence of a single topic is analyzed across all
interviews, although the resulting discussion is still structured according to separate
interviews on the second hierarchical level after the subject of discussion. The exception
to this approach are the interviews with expert #1 and expert #7. As they provide less
relevant information to the main topics of discussion, they are included in the main
analysis to a smaller extent, but also analyzed separately and discussed in a separate
chapter. During the discussion the information gained from the interviews is also
compared to the information obtained from literature that is described in chapters 3.2
and 3.4.
 26

HR Processes Obstacles Software & Company /

Tools Team Size

Expert #2 performance trust, lack of Excel, 300 / 6

management, analytical Redmine
performance mindset (modified)
evaluation,
employee
satisfaction,
recruitment,
attrition
management

Expert #3 employee data Excel, Power 30K / 15

satisfaction, fragmentation, BI, SAP,
attrition data quality, Decidalo
management data privacy,
resources

Expert #4 strategic lack of Excel, SAP, 70K / 10

workforce analytical Python, Power
planning mindset, data BI
privacy,
resources

Expert #5 strategic data quality, own system, multiple large

workforce lack of NLP, LMS von companies /
planning, strategic IMC 15
recruitment, competence
industry and analytical
analysis, mindset
performance
management

Expert #6 attrition data SAP, SAP 170K / ~ 100

management, fragmentation, OnPremise, employees
strategic data privacy, Power BI, working on
workforce lack of Micro Strategy, analytics in
planning, analytical Tableau, total, 6 in own
performance mindset Python, R team
management/s Code
kill
management
Table 1: Interview reference chart (own depiction based on interview transcriptions)

5. Interview analysis
This section deals with the analysis of the expert interviews. Insights gained from these
are discussed in accordance to the questions posed in chapter 1.1.
 27

5.1 Understanding of the terminology

The understanding of the terminology is the first factor that can provide an insight into
how deep the understanding of PA in a given department is, and what aspects the
department focuses on. As expected, expert #1 (p. 2) has no direct experience with PA,
but, when confronted with a definition, shows an understanding of the general concept.
Expert #2 (p. 1) is much more familiar with the term and describes how the strategic
decisions based on data processing are intrinsic to PA (Marler and Boudreau, 2016, p.
13). In her interview she doesn’t directly mention specific stages of analytics, like
descriptive or predictive analytics, but expresses knowledge about the corresponding
processes, as she mentions predictions in the context of analytics (Expert #2, p. 1).
Expert #3 (pp. 2-4) shows an extensive comprehension of the terminology, accurately
describing the main processes of analytics, including diagnostic analytics, and also
separates it from reporting. Experts #4 (p.6) and #5 (p. 14) are similar in that they
mention the different analytics processes. Expert #4 (p.2) also gives examples of what
he thinks the difference between PA and HR analytics is, although this includes the
statement that PA is focused around employees, while HR analytics is applied to HR as
a whole, which shows how vague the definitions are. Expert #6 (p. 1) has a short and
on-point definition of PA, mentioning insights that are used for business decisions. He,
however, doesn’t distinguish between PA and HR analytics. Expert #7 (pp. 1-2),
similarly to expert #1 has no experience with PA as such and is more familiar with HR
reporting. Most importantly, experts #2-#6 have a mostly congruent understanding of
PA, as such the comparison of their answers makes sense.

5.2 Сurrent state, use cases and experience with PA

Currently there is a mixed сonnection to PA in the work of the participating experts.
While experts 1# and 7# don’t have any direct PA experience, experts 2#, 3#, 4#, 5# and
#6 interact with different forms of PA on a daily basis, although to varying degrees.
While especially due to conflicting literature it was chosen to leave the distinctions
between HR analytics, PA, and adjacent terms out, the form of PA used in the experts’
departments varies a lot, as already described in the previous chapter. As such, PA in
these departments is currently in different stages. One thing, however, that is common
 28

among all experts that do conduct a form of PA, is that it is a recent development,
ranging from just a couple to a maximum of 8 years (expert #6, p. 3). The stages at
which PA is used range from mostly reporting coupled with a small amount of
descriptive analytics (expert #3, p. 3), to a full implementation of descriptive, predictive
and prescriptive analytics (expert #5, p. 14). The case of expert #3 is a prime example
for a trend that has been going on in HRM for the last decade - oftentimes there is a plan
to introduce PA, but progress struggles, as mostly basic reporting is provided (Van den
Heuvel and Bondarouk, 2017, p. 19). It is also a humble start, as for a rather large
company of around 30.000 employees only one HR process, admittedly one of high
importance, gets proper analytical attention Interestingly - attrition management.
Interestingly, this is due to an interest and a corresponding push from the higher
management level, as the importance of avoiding skill gaps (Adeyemo and Alao, 2013,
p. 17) is clearly noticed. Although the project is still young, with PA in general being
around in the department for less than two years, it comes with a well thought out plan
(expert #3, pp. 3-4). The current status is describing and visualizing which employees
are leaving, providing data about their age and skills, while in the next step it is planned
to conduct diagnostic analytics, to also describe the reasons while employees are
leaving. This is done in data visualization tools like Power BI. The Data collection,
however, is still manual in this process. While core personal data gets directly
transferred to Power BI from the personnel management system SAP and the skill
platform Decídalo, attrition data has to be manually collected from HR managers
through Excel forms (expert #3, p. 11). Further plans include using predictive analytics
to calculate the probability of employees with key skills leaving in the near future, and
ultimately implementing prescriptive analytics to offer possible solutions and suggest
courses of action (expert #3, pp. 3-4). This also shows that knowledge of the full
analytics process is certainly there and an implementation should not be that difficult.
Obstacles that slow this process down will be discussed in the next chapter.
Another case that explores an extensive implementation of PA, but at the moment is still
stuck with reporting, is that of expert #4. The project here is also very young, as the first
preparations for analytics began in 2020 and the first real analytics cases have been
processed this year (expert #4, p. 5). Similar to the case of expert #3, PA here is
restricted to only a few HR processes, mainly strategic workforce planning servicing the
 29

talent pipeline (expert #4, p.6), while recruiting has also been touched upon to a smaller
extent (expert #4, p. 6). This trend is a general problem in PA, as many companies do
not make extensive use of PA in all stages of HRM, but limit themselves to one or two
use cases (Schiemann, Seibert, and Blankenship, 2018, p. 1). The stage at which PA is
in this department also repeats the story of expert #3, with an early form of descriptive
analytics being applied today, while the plan is to gradually implement diagnostic,
predictive, and finally prescriptive analytics (expert #4, pp. 5-6). The data collection
itself is automated through an external service provider, which seems to be a trend in
segments of a large company like Deutsche Telekom (expert #4, p. 6). The collected
data comprises mostly core personnel data, like age, location, weekly working hours,
which then is also coupled with skill data, so that a meaningful result can be delivered
for strategic workforce planning, ensuring the talent pipeline works as intended and
relevant skills are always available (Ontrup et al, 2019, p. 64). In terms of the
implementation timeline this project is staggering, which is also connected to a
substantial backlog of IT-implementations which is slowly being worked off (expert #4,
p. 12).
The case of expert #6 seems to be the most advanced of these three, as although for the
most part the same data is used, being mostly core personnel data combined with skill
data and also attrition and pension data, actual descriptive and predictive analytics are
being applied here (expert #6, p. 6). This is still combined with reporting, but expert #6
(p. 2) also mentions how PA is used to provide answers to questions about investment,
skill management and skill retention, as well as necessary organizational
transformations. In terms of PA development, the main project being worked on right
now is a consolidation of different data sources, with the aim to combine them into a
single, coherent structure, so that analytics and reporting can be carried out in a more
efficient way (expert #6, pp. 5-6).
Expert #2 (pp. 1-2) describes a very different case, as she is from a rather small
company of a few hundred employees, but works with descriptive and predictive
analytics regarding less core personnel data, but more skill data, employee satisfaction
and engagement data, attrition data, as well as external data on the labor market (expert
#2, p.5). This is then used to give the management insights for processes like employee
performance evaluation and engagement management, so that a better understanding
 30

between employer and employee can be achieved (expert #2, pp. 2-3). The external
analysis of the labor market is used for the strategic workforce management,
specifically for the recruitment process (expert #2, p.5). Interestingly, although attrition
data has been collected before, the company deemed it less necessary for attrition
management, as it is claimed that reasons for attrition in the IT branche are usually the
same, being well-studied and understood by the company (expert #2, p. 6). This goes
against the assumption that the main danger of attrition is its unpredictability (Adeyemo
and Alao, 2013, p. 17). Another interesting aspect is that due to the company’s smaller
size, data is for the most part collected manually, although it is then used in such an
extensive manner. Expert #2 (p. 5) comments specifically on the manual collection of
external data for recruitment and the labor market analysis, stating that job profiles in IT
are so specific and bring such specific skills with them, that it is impossible to assess
them with an automated algorithm at the current stage.
A drastically different case is that of expert #5, as he is not a professional in an HR
department, but rather a product manager for an external PA solution that is provided to
enterprise-sized companies in the financial and IT sectors among others (expert #5, pp.
1-2). This is a drastically different approach to the implementation of PA in the
departments of the other questioned experts, as a comprehensive all-in-one solution is
used to make predictions in the area of skill and workforce management (expert #5, p.
5). The main process is one that expert #2 (p. 5) described as too challenging at the
moment, namely consolidating job profiles and corresponding skills in a coherent
manner. Expert #5’s software solution aims to solve this problem to provide companies
a comprehensive experience when scouting the labor market for specific skills. The
internal analysis of skill profiles also incorporates soft skills which may be needed for
different roles (expert #5, p. 3). This flows into the process of strategic workforce
management, as not only the hard and soft skills of the employees are analyzed, but also
global data about job and skill profiles in different companies and industry-specific
trends and developments is taken into account to ultimately predict how the whole
relevant business landscape will look in the future, and as such, which job and skill
profiles will be needed (expert #5, p.4). All of this is done in an anonymized or
pseudonymized way, with mostly role data being relevant, while core personnel data
isn’t used at all (expert #5, pp. 10-11). Although pseudonymization allows client
 31

companies to track the relevant data back to their actual employees so that the measures
proposed by the external solution can be actually implemented, on the solution
provider’s side only the correlation between the employee role, corresponding skills,
meaning both hard and soft competencies, and behavioral factors is analyzed (expert #5,
p. 4). This approach also means less problems with data privacy and compliance. The
result is that based on descriptive, predictive and prescriptive analytics multiple paths
for further actions are provided, which then can be used by the client company’s
management to make strategic decisions (expert #5, pp. 13-14). Expert #5 (p. 7) gives
an example for a successful application of the PA solution provided by his company. In
this case, it is analyzed which employees were the most relevant and would bring the
most potential when transferred to a freshly established business department and which
trainings are still needed for these employees. Another big difference to the other
experts’ cases is that the software solution provides results based solely on analytics,
which goes against the trend that most HR professionals trying to apply PA are still
stuck in metrics and reports (Van den Heuvel and Bondarouk, 2017, p. 19). The whole
process is also mostly automated, which has two main benefits. On the service
provider’s side a minimal number of servicing employees is needed, as only around 15
analytics and data science experts cover multiple medium sized and large organizations
and 1.8 million data records per day (expert #5, pp. 6, 15). On the client companies’
side there are also massive savings, as the results provided by the solution can be
processed by traditional HR managers and no specialized professionals like data
scientists, analysts or data engineers are required (expert #5, p. 5). Another observation
is that the timeline of around 5 years isn’t that much longer than that of the other
discussed PA projects, meaning that with proper knowledge, management, prioritization
and resource allocation the implementation of functional PA can be done in a rather
quick time.
Experts #1 and #7 are special cases, as both mention to not have direct connections to
analytics as such. Nonetheless, both provide valuable insights into HR departments that
have not yet embraced PA, both in the potential they see for PA and as an example what
limited understanding of PA there is in some HR departments. This will be further
discussed in chapter 5.7.
 32

5.3 Challenges for PA as seen by experts

As mentioned in chapter 5.2, regardless of well presented plans for the future, the actual
implementation of PA lags behind in many cases. This chapter discusses possible
reasons the experts themselves see for this staggering, comparing them to priorly
discussed general obstacles for an adoption of analytics. Interestingly, the resulting
picture is not as uniform as chapter 3.4 might have suggested. Some barriers and
obstacles most experts have a common understanding of, while others are mentioned by
only one or two experts, and again some obstacles mentioned by some of the experts are
specifically rejected as obstacles by others.

5.3.1 Data privacy protection

With most of the experts residing and working in Germany, it is unsurprising that data
privacy protection is seen as one of the main obstacles, as mentioned by experts #1, #3,
#4 and #6. The huge amount of regulations affecting data collection, storage and
processing in the EU leads to many HR processes that involve analytics running
suboptimally. Expert #6 (p. 9) mentions the struggle of balancing between doing
meaningful analytics work, providing the most useful results and complying with acting
data privacy regulations. A technical solution to an analytical problem may be
implemented in a few weeks, but coordinating it with all the possible regulations and
limitations and ensuring nothing slips through takes multiple months. This slow and
careful approach is also justified, as possible mistakes may result in hefty fines (Petry
and Jäger, 2018, p. 190). The one positive outlook is, as mentioned by experts #6 (p. 9)
and #4 (p. 11), that these regulations are usually very elaborate and provide very
detailed information on how to proceed with data-adjacent processes in most cases. As
such, it is at least a matter of strictly following them, although it is still a lot of work to
transfer this information to practical cases and gain a comprehensive answer of what is
allowed, and what isn’t. Many regulations also do not come directly from the GDPR,
but from internal company regulations in agreement with the works council (expert #3,
p. 13). As such, it is possible to negotiate the permission for different cases that were
not possible before, but this process takes a long time and is not always successful.
Expert #3 (p. 9) mentions an example in that her department wants to use
pseudonymised data to have better understanding of the correlations behind relevant
 33

data, but this possibility is still negotiated with the works council, while only fully
anonymized data may be used at the moment. Therefore it is difficult to generate
reliable results from employee satisfaction data, as it isn’t connected to personal data
and there is no way to take account of possible changes in an employee segment
between surveys, so that it sometimes isn’t even clear, if they have been answered by
the same people (expert #3, p.10). Another desired development that is hindered
specifically by the works council’s regulations is, according to expert #3 (p. 13), the
consolidation of different data source systems, as too much data would be connected to
be considered anonymized. This integration of data is also a topic that Van den Heuvel
and Bondarouk (2017, p. 31) consider to be a central part of the future development of
PA.
A different view of data privacy protection is given by expert #2 and expert #5. Expert
#5 (pp. 10, 11) explains that since the solution provided by his company deals only with
pseudonymised data, there appear no difficulties with data privacy protection at all. This
means, however, that the client companies must have the topics of pseudonymisation
and sourcing their data out to an external provider sorted out with their works council.
As expert #5’s company services a substantial number of medium sized and large
organizations, this seems to be a solvable problem. Expert #2’s stance on data privacy
protection is the most interesting one, as her company operates outside of the EU and
isn’t bound to the GDPR. The employees in expert #2’s (p. 8) case sign a consent to
provide personal data when they enter the company, which is, however, not that
different from the personal data sheet employees fill out in Germany (see expert #4,
p.7). On the other hand it is much easier for expert #2 to consolidate data and make all
the necessary connections, as the use of pseudonymised data or even direct attributions
between engagement, performance and employee satisfaction surveys show.

5.3.2 Data fragmentation and standardization

A subject that has already been touched upon in the last chapter is how PA is slowed
down by the inability to collect all data in a centralized system. Expert #3 (p. 11)
mentions this as one of her main frustrations with analytical work. As long as different
data systems cannot be combined with each other, analytical processes have to make use
of suboptimal data and need more time and resources to come to less qualitative results.
 34

Data fragmentation is also a problem that exists since before PA was a thing. Expert #7
(p. 12) discusses its negative implications also in the context of basic reporting and
organizational bureaucracy. While data quality is in itself a substantial problem for PA
(Minbaeva, 2018, p. 2), the fragmented datascape only makes it worse. As both expert
#3(p. 8) and expert #6 (p. 5) state, the scattered data is, however, not purely a problem
of data privacy protection regulations, but also of technical limitations, as there are
often difficulties and incompatibilities in the connection of different data systems.
Expert #6 (p. 5) provides further detail, describing how the data he works with, which,
to be fair, covers around 170.000 employees, is divided across at least 10 different data
systems for core HR data, as well as many more specialized strategic systems.
Additionally, he mentions how the problem expands on an enterprise level, as data may
be consistent on the local level of company branch offices in different countries, but
shows a lot of inconsistencies when combined to a global level (expert #6, p. 11). The
standardization of such data needs a huge amount of work, as it has to cover multiple IT
systems, multiple company branches with possibly different customs in how data is
structured, multiple countries with possible language barriers, and multiple legal entities
across these countries. Still, a centralized HR data pool like this would improve the
results of PA drastically.

5.3.3 Data quality

Another obstacle that is identified by most of the questioned experts is data quality. As
mentioned in chapter 3.4, quality, data quality is oftentimes stuck in a paradox. Good
data quality requires investments and resources, while upper management usually
expects exquisite results to provide such investments, good results in turn need good
data quality to begin with (Minbaeva, 2018, p. 3). As already mentioned in the last
chapter, sometimes the bad quality of data is due to an inability to combine different
data sources. The much more common reason, as expert #3 (p. 16) states, is the lack of
awareness of data importance. She provides an example, stating that in their first
attrition report the job profiles were specified in only 36% of cases. This is a problem
that most of the questioned experts are dealing with. Expert #5 (p. 10) associates this
problem with a lack of analytical or rather strategic mindset, as many HR professionals
 35

do not have the proper understanding of what data is actually needed to generate
qualitative predictions or decision-supporting insights.
Expert #2 (pp. 7-8) demonstrates a different perspective to data quality, as in her case
the strongest factor for low quality of data is a possible lack of trust. She further
explains how in the first stages of conducting PA employees oftentimes provided
answers that they perceived as socially desirable, effectively telling the employer what
he wants to hear, not the actual state of affairs. Therefore this case shows another reason
for low data quality - a lack of trust between the employees and their employer. As
expert #7 describes there is another level to data quality when it comes to
non-mandatory data that is directly provided by the employees. Such data is oftentimes
used in surveys for the employee satisfaction management, among other disciplines.
Motivation and involvement are the key factors here, as expert #7 (p. 4) complains
about low involvement rates when conducting pulse surveys among students. This
brings up a paradox similar to the one mentioned at the beginning of this chapter - to
increase involvement, it is necessary to gain qualitative results that show why a survey
matters and what positive effects analyzing it can bring. However, said qualitative
results can only be achieved with a sufficient involvement rate.

5.3.4 Resources
The problem of insufficient resources is the easiest one to describe. Again, investments
are required not only for good data quality. Many HR departments are understaffed,
especially when it comes to analytics in these departments. While the case of expert #5
shows that a group of 15 professional data analysts and data scientists can be enough to
manage PA for multiple medium sized and large companies, this is only possible due to
an extensive effort in implementing an automation that, once there, takes care of the
main bulk of the work (expert #5, p. 14). The other experts’ HR departments are
certainly not on a level of automation that is anywhere near that. Most of them seem to
be in roughly the same dimensions. Expert #1 speaks of a team of roughly 30
employees for the whole external recruitment section of a segment with 70.000
employees. Expert #2 is part of the smallest team, but also works with a group of
smaller companies that have around 300 employees in total. Said six people, however,
comprise the whole HR department and are tasked with all HR processes, not only with
 36

PA. Expert #3 reports around 15 employees in her HR analytics team that covers an
organization of around 30.000 employees. Additionally, only one employee in this team
brings actual technical knowledge about the structure of data systems, while the team is
generally less specialized and everyone more or less works on everything. The numbers
are even further apart for expert #4, who leads a freshly created team of only about 10
employees, covering an organization of about 70.000 employees. Expert #6 probably
shows the most available resources, as although his actual team is pretty small with only
six employees, the total number of people working on reporting and analytics (including
also technical experts) he describes is about 100 employees, although they also cover an
enormous organization segment of about 170.000 employees. Finally, expert #7 speaks
of around 400 employees working over 6000 students in total, although this is a very
different case, as these employees are actual study supervisors,whose work includes a
lot more direct support to the students. This statistic shows that although only expert #5
can speak of successful automation and consolidation of data in his work, other teams
covering the same or possibly an even bigger number of employees, ultimately are of
the same size.
Expert #4 (pp. 11-12) also speaks of the underbudgeting of IT departments hindering
the successful implementation of PA, as data systems often are not fit for analytical
measures, making them ready takes a lot of time, as both budgeting and IT specialists
are missing. This is another reason why the PA projects like his lag behind schedule.

5.3.5 Competencies and mindset

The lack of financing is also affecting the presence of relevant skills and competencies
for PA. These include, unsurprisingly, analysts, data scientists, data engineers,
integration experts, and other professionals in the field of data analytics and big data
(see expert #3, p. 8, expert #4, p. 13, expert #6, p. 10). The most important skill,
however, that most questioned experts agree on, is an analytical mindset. Expert #2 (p.
8) goes as far as to say that actual deep knowledge on the functioning of analytical
processes is not that important, as most tools and analytical software are equipped with
a frontend that allows to conduct descriptive and predictive and analytics without any
deeper understanding of the backend processes. This is similar to the case of expert #5
(p. 5), as his company’s solution also provides the main forms of analytics to HR
 37

managers, who don’t have to be specialists in analytics themselves. Expert #2 (p. 8)

continues to explain, however, that skills in mathematical analysis or just an analytic
mindset are required for a much-needed understanding of how to actually apply PA and
the results provided by PA. She exemplifies how an ideal HR employee should be able
to gather an understanding of methods he or she is working with, not just blindly follow
the method.
Expert #6 (p. 10) supports this idea, stating that a data-driven mindset is very much
required to be able to make use of the descriptive, predictive and prescriptive results
provided by PA, as the interpretation of these results is another competency that cannot
be assumed for every employee. He also shares an opinion with expert #4 (p. 12) and
expert #3 (p. 11), who describe the analytical mindset as an ability to be confident in the
results provided by analytics, and not rely that much on one’s own gut feeling. This idea
also coincides with the already mentioned problem of many business and HR managers
not being ready for an analytical approach and relying more on their own perceived
knowledge and experience.
Expert #5 (p. 11) provides an interesting alternative point of view that mimics that of
Andersen (2017, pp. 3-4), stating that a strategic mindset is the most important thing
and that HRM in general needs to identify itself in more of a strategic role, rather than
operative. Operative tasks can be taken on by IT solutions, but a strategic mindset
actually helps in finding applications for the results given by PA, as well as inspires a
manager to conduct own simulations to work towards optimal courses of action.

5.4 Proposed solutions

While the identified obstacles certainly are hindering the rate at which PA is being
implemented in HR departments, there are also ways to overcome them or even bypass
them entirely. Data privacy protection is an area that seems to be unavoidable for
companies based in the EU for the foreseeable future. However, research shows that the
GDPR doesn’t prevent PA from doing what it wants to do, especially when the tools
used for PA follow the concept of Privacy by Design (Cavoukian, 2010, pp. 2-5). Yes, it
raises the costs of a successful implementation, but this only means that the ROI needs
to be high enough - which it is expected to be at least in the areas of strategic workforce
planning and recruitment (Ben-Gal, 2018, p. 1439). The main problem most experts
 38

mention in combination with data privacy protection lies with the works council. The
works council, however, usually has the best conditions for a company’s employees in
mind and as such can be persuaded with data on an increase in employee satisfaction.
Expert #3 (p. 17) mentions that the works council can be very cooperative once the
meaning and purpose of an analytics project has been described to them. Taking these
considerations into account illustrates how data privacy protection isn’t as much of an
unavoidable obstacle, as it is a delay which can be accounted for and counteracted with
better investments.
Data fragmentation can essentially be boiled down to two problems. The first problem
source has already been mentioned with data privacy protection. The case of expert #5,
however, shows that this can be overcome, as his company consolidates data from many
different organizations. The second problem source is the sheer scope of work that
needs to be done to bring together different data systems. This is less of an issue for
smaller companies with only a few data systems, but expert #6 shows that given enough
time and effort this can be done for a company of 170.000 employees. He (expert #6, p.
12) also thinks that although it may be too early for artificial intelligence to solve this
problem, it could certainly be a possibility in the future.
The problem of data quality is more difficult. As expert 3# (p. 14) mentions, data that is
provided manually by other HR or business managers can be improved by simply
talking to them and making clear what is needed of them. Increasing involvement can
also be done via an information campaign and by managing employee motivation in
general, delivering results and decisions based on them that increase employee
satisfaction and as such make them want to supply their data (expert #6, p. 11). In
expert #2’s case (pp. 7-8) the problem of unreliable data was solved naturally through
building up trust between the employees and the employer. Additionally, dedicated data
quality assurance can be applied, which is done by the external provider who is also
responsible for collecting and storing the data in the case of expert #4 (pp. 8-9), and
through dedicated statistical methods applied to measurement errors in the case of
expert #2 (p. 3). Data quality can also be improved via an approach similar to the
concept of Privacy by Design used in data privacy protection, namely the purposeful
design of future data (Jeske and Calvard, 2019, p. 256). Additionally, the already
discussed subject of data source standardization is another way of improving data
 39

quality, as bad data is oftentimes the result of data fragmentation, which goes hand in
hand with data cleaning (Levenson and Fink, 2017, pp. 10-11).
Lack of resources is an obstacle that intensifies all the other problems mentioned in this
chapter. Both data source standardization and data quality can benefit from better
investment. The solution is once again exemplified by the case of expert #5(pp. 8-9): an
extensive study of the technology and the experiences associated with PA. As such,
investment leads to investment. Which means that the upper management level needs to
have a clear idea of the benefits PA can bring to their company and act accordingly. The
paradox of good results and sufficient investment (Minbaeva, 2018, p. 3) can also be
turned into a self-fulfilling prophecy, as results provided by PA usually also imply that
investments into HR need to be improved (Ulrich and Dulebohn, 2015, p. 16). The case
of expert #3 (p. 3) shows an approach that isn’t as well thought out, as the subject of
attrition analytics is pushed from the upper management level, but the actual team
working on it is too small.
For the last discussed obstacle, data analytics professionals are also a simple matter of
budgeting. The problem of the analytical mindset, however, is not that tangible. There is
no solution to this other than a process of work and error and, ironically, proper
workforce management and treating it as a soft skill that is needed for PA teams and in
HR departments in general. This is also based on the fact that employees with
distinctive analytic abilities prove to have better performance overall, as they can make
better use from insights to make beneficial decisions are better at communicating with
other, more number-oriented departments surrounding HR, leading to an even better
understanding of the surrounding situation (Kryscynski et al, 2018, pp. 3-4).

5.5 Future potential of PA

When it comes to future potential the questioned experts express varying opinions.
Interestingly, some processes that are seen as potential future developments are already
implemented in the departments of other experts. Expert #2 (p. 6) is the most content of
all the experts when it comes to the current state of affairs. She describes that the
interaction and trust between employees and their employer is the most important
development that has come out of the implementation of PA, giving employees the
ability to make themselves heard by the upper management, and supporting the
 40

employer with data-based strategic decisions. As such, she sees no benefit in further
development in the area, at least not for the needs of her own company. On the global
scale she supports the adoption of PA by a rising number of companies and welcomes
the benefits it can bring to engagement and transparency. Expert #3 takes a pragmatic
approach, discussing the automated collection of data (expert #3, p. 11), possible
pseudonymisation (expert #3, pp. 8-9) and the consolidation of data source systems
(expert #3, pp. 11-13) as future potentials for her PA team. The combination of these
factors should result in a more efficient operation of PA and provide more qualitative
results. When it comes to current achievements she mentions how the attrition project
has brought management attention to better investment in the hiring and learning
processes (expert #3, p. 15), which is ultimately a good result for strategic workforce
planning. The pragmatic developments discussed by expert #3 are not as far-fetched, as
automation and data source consolidation have been or are currently being implemented
by the departments of expert #5 and expert #6.
Expert #4 (pp. 12-13) takes a more market-oriented approach to the potentials of PA,
stating it will be used to analyze the whole industry and derive strategies that will give
the company competitive advantages. He also sees a development for a better
investment in PA as data-driven HR has become the executive strategy for his company
in 2022. Expert #5 (p.12) has a more explorative view on the future potential of HR,
discussing how PA can support the reskilling process, which is becoming more
prevalent with different industries undergoing transformation. In this case PA should
provide data-driven support while HR managers take strategic and person-oriented
actions. Expert #6 (pp. 12-13) chooses to focus on how PA itself will grow in the
foreseeable future, with more sophisticated analytical methods being implemented over
incremental advances and shares his thoughts on how the consolidation of data sources
might benefit from advances in artificial intelligence, although this is still a distant
development. He also mentions how companies might focus more on data surrounding
employee wellbeing, especially in the context of the Covid pandemic.
Another potential development that isn’t directly discussed by any of the experts, but
rather inspired by one of their cases, is rise in popularity of comprehensive PA service
solutions, like the one expert #5’s company provides. This approach to PA can benefit
companies of all sizes, as they can bypass most challenges an adoption of PA is faced
 41

with and profit not only from general results provided by descriptive, predictive or
prescriptive analytics, but also from statistical data gathered between all companies,
while at the same time saving costs on creating an own PA department and hiring or
training analysts. This kind of PA-as-a-service is also mentioned by Van den Heuvel and
Bondarouk (2019, p. 32), who state that it is a much faster way of implementing PA in a
company. While the other experts’ company segments also use external providers, these
are mostly responsible for only collecting and storing data (expert #4, p. 6)

5.6 The effect of company size

The effect of a company’s size on the implementation and potentials of PA is not
mentioned in scientific literature. Still, it can be discussed based on the insights
gathered in the expert interviews. Although the questioned experts are not as diverse in
terms of their companies’ sizes as initially planned, they still cover a reasonable range.
The first observation to make is that expert #2, while working for the company with the
smallest number of employees, relies less on automated processes and more on manual
collection of data (expert #2, pp. 4-5). The company is also the only one of the
discussed that doesn’t make use of any external providers or consulting, as they don’t
see any added value in doing so. While the HR department is very small and there is no
dedicated PA team (expert #2, p. 3), the expert also doesn’t report about being
understaffed. This also doesn’t seem to limit the extent to which PA is used in the
company, as it covers the processes of recruitment, employee performance evaluation,
engagement management and employee satisfaction management. This is a broad
application that goes against the trend of many companies using PA for just one or a few
use cases (Schiemann, Seibert, and Blankenship, 2017, p. 1). On the flipside, PA is
probably not used to a very large extent in any of the given cases, as expert #2 (p. 2)
states that the involvement survey, which is conducted once to twice a year, is the
largest area in which PA is used in connection with employees. This, however, can also
be interpreted in a positive way. Since this amount of PA fully covers the company’s
requirements, there is no need to increase the amount of processed data and even make a
dip into big data. This also means that there is no need for the expenses involved with
hiring dedicated data scientists and data engineers to create and operate an extensive
 42

data management system. For how long this remains a viable option as the company
grows remains to be seen.
On the other end of the spectrum lies the case of expert #6, whose department services
an international segment of 170.000 employees. PA applied on this scale certainly deals
with big data and runs into different problems, like the amount of data sources that need
to be consolidated. The core data, however, that is processed the most, is of good quality
and consistent on local levels (expert #6, p.11). The work structure around PA is also
well organized, as there are a lot of specialized teams with relevant professionals
working on different parts to ensure that everything functions properly (expert #6, p. 4).
The other experts’ departments send a mixed message, as in both the cases of expert #3
and expert #4 segments of reasonable size are serviced, a clear plan for implementation
of the different stages is present and the first steps have already been made. Still, the
implementation is slow and impeded by major challenges which have been discussed in
previous chapters. The case of expert #5 is special, as it shows how different companies
use PA as an external service, but no detailed insights into these companies that can be
analyzed are given. Expert #5 states, however, that they often do have specialists that
have a deep understanding of PA, but that doesn’t mean that the companies themselves
are ready to conduct PA (expert #5, p. 10). To sum these thoughts up, based on the
insights provided by the expert interviews, the size of a company is a factor that affects
the organizational structure around the implementation and operation of PA, but not its
actual potential or the use cases in which it can be applied.

5.7 Potential of PA from a traditional HR perspective

In the previous chapters analyzing the expert interviews an obvious absence of expert
#1 and expert #7 is noticed. This is by design, as both of these experts represent HR
departments that have not yet experimented with any form of PA. As such, the
corresponding interviews don’t provide much useful information concerning the
questions discussed in previous chapters. They can, however, still give insights into the
potentials PA can provide, regarded from another perspective.
Expert #1(p. 1) is in the position of a recruiting consultant, meaning his main bulk of
work has to do with employee acquisition. This is, as previously discussed, an area that
 43

can benefit a lot by the adoption of PA, as said adoption yields the highest possible
potential ROI when compared to other main HR processes where it can be applied
(Ben-Gal, 2018, p. 1439). Expert #1 (p.2) doesn’t possess extensive knowledge about
PA, however, he shows an understanding of what analytics is and how it can be applied,
giving the example of an automated assessment of candidates, matching their skill
profiles and information provided by their application documents with the company’s
requirements. This is a process that is already implemented by expert #2 (p. 5), although
in her case the actual data collection is manual.
Expert #1 (pp. 3-4) also mentions how data about the recruitment process is collected
for recruiting, namely personal and skill data about the candidates, data on the sources
from which applications come, and also data about candidates opting out. He also
suggests how diagnostics could be applied to the last point, providing information about
the reasons why candidates stop the application process. A possible reason why no
attempt at PA at all has been made in expert #1’s department, is that even the
IT-supported reporting is a rather young development, being implemented for only a
few years (expert #1, p. 5).
While no dedicated PA project has been started in expert #1’s department yet, some
form of analytics is actually conducted here, being labor market analytics using
Gartner’s TalentNeuron tool. This is similar to how tools are used in expert #2’s case (p.
8), as TalentNeuron, similarly to Redmine, provides analytical insights, which are then,
without the help of actual data analysts, used by expert #1’s department to adapt the
recruiting strategy (expert #1, p. 8). As such, data-based insights are used to influence
strategic decisions. This is also similar to how expert #5 describes his platform: no
dedicated data analysts are needed, only HR managers with a strategic and analytical
mindset and the ability to understand analytic results and apply them to strategic
decisions. The rest can be done by software.
Expert #7 (p. 1) works in a more unique HR environment, as she is a study supervisor
managing the university and in-company education of young talents making their
degree through a partner-program while simultaneously gaining experience as trainees
in the company. The main difference to more traditional employee management is that
the performance and growth of students is monitored and supported on a deeper basis,
with study supervisors being assigned 30 to 40 students each (expert #7, p. 4). Some of
 44

the classical HR processes show differences in this environment with strategic

workforce planning being seen from a context of available apprenticeship positions and
the skills students can learn in the corresponding departments (expert #7, p. 9).
Recruitment is conducted in a standard manner. Study supervisors are mostly interested
in the skill data delivered by applications, although no attempts are made at an
automated assessment of these skills during the recruitment process (expert #7, p. 1).
The processes study supervisors are mostly concerned with are performance and growth
management and employee satisfaction management (expert #7, pp. 2, 9). Employee
satisfaction management is also the main method of employee attraction and employer
branding, as a lot of value is placed on students being enthusiastic about the way their
education and career is handled, leading to them creating a positive company image
through word of mouth (expert #7, p. 8). When it comes to actual data, employee
satisfaction data is the one thing that is collected and evaluated on a regular basis
(expert #7, p. 6), while skill and growth are assessed through regular personal
conversations between students and supervisors, using more of a pedagogical approach
(expert #7, p. 10). Data collection on employee satisfaction runs into the same problems
here that experts #2 (pp. 7-8) and #3 (p. 16) speak of: motivation and, to a lesser extent,
trust. (expert #7, p. 4). This is a problem regarding data quality, that has already been
discussed and can be solved through involvement and engagement management. This is
already done to an extent, as survey results are presented to students and discussed with
them on a regular basis, with the aim to both gather insights on possible deeper reasons
for negative employee satisfaction and also raise the students’ awareness on the
importance of said collected data. The data collection and assessment itself is once
again conducted by an external service provider (expert #7, p. 4), while the study
surveyors then interpret the assessed data and develop measures based on it (expert #7,
p. 6). This is the closest thing to actual analytics that is done in this department, which
follows a similar trend to the cases of experts #1 (p. 8), #2 (p. 8), and #5 (p. 5), in that
PA is provided by either an external provider or a software, and the HR professional
first of all needs analytical competence to interpret the outcome.
 45

6. Conclusion
The research of PA is a process that certainly benefits from analyzing personal
experiences from HR professionals in addition to the basic literary research. While the
latter provides a solid basis for the understanding of PA, the HR processes it can be
applied to, as well as the factors included in the troublesome adoption of PA, it still
shows how understudied this area is, even a decade after its rise in popularity. The
experts’ experiences with PA show a vivid demonstration of how slowly the PA is
introduced into HR environments, with most approaches being there for only a couple
of years and still being in progress.
PA brings a lot of potential for the effectiveness of HR departments. Personal
experience of the experts show that PA can be applied in most significant HR processes,
covering most parts of an employee lifecycle. The benefits to these processes range
from higher efficiency to reduced costs and overall better foundations for strategic
decisions. The cases of experts #1 and #7 show that even HR departments that have not
yet explored the potential benefits of PA can see the value in applying an analytical
approach to at least some of their processes.
The obstacles identified by the experts don’t represent anything that can’t be overcome
given the proper financing, time frame, and most importantly the understanding of what,
how and why exactly has to be achieved by the upper management. The experts’ cases
show that the more PA is pushed from the companies’ top levels, the more likely it is to
succeed. Experts #2 and #5 are happy with the current state of affairs in their
companies, while the cases of at least experts #3 and #4 show that the understanding of
the importance of PA slowly but surely finds its way into the judgments of higher
executives of Deutsche Telekom AG, implying that future developments might be more
consistent for the company.
Company size is a subject that could be explored deeper, however, for this quantitative
research methods may be more suited. While literature research has not given any
information on this topic, the limited analysis that was possible with the help of the
expert interviews shows that the actual company size does affect in which ways PA can
be applied, but not the potential of its adoption and the ultimate benefit gained from it,
namely a data-driven support of strategic decisions.
 46

One topic that wasn’t considered prior to the analysis of the expert interviews and has
not been covered in literature at all is the potential of an adoption of PA via external
service providers or dedicated software solutions. Expert #5’s case is a great example of
how PA-as-a-service can work and bring great benefits to a company, with no need for
extensive investments into their own infrastructure. An efficient operation of PA
requires prior investments into automation, which in this approach can be skipped, as a
dedicated PA company has already done it. These software solutions can also vary in the
extent of how much work they can take over. In expert #2’s case Redmine is only used
for actual analytics, data collection and data interpretation are still done by the HR
employees. In expert #1’s case, however, TalentNeuron is a tool that does both the work
of collecting data and subsequent analytics. What remains unchanged, however, and has
been explicitly addressed by expert #5, is that the interpretation of analytical outcomes
is a process that will always have to be done by human professionals. As such, the most
important skill that is needed not only to be successful at PA, but for HR in general, is
an analytical and strategic mindset.
With this discussion all subquestions posed in chapter 1.1, as well as the main scientific
research question, have been answered.

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Bonn, 03.01.2022
Alexander Freimeyer