People data: The risks, rewards and opportunities

Andrea Fouche in Silicon Republic: “The people data revolution has finally arrived. 69pc of organisations are building integrated systems to analyse worker-related data. Leading companies are monitoring people data from many sources, including social media (17pc), surveys (76pc), and integrated data from HR and financial systems (87pc). Creative organisations are mining this rich variety of sources to create a comprehensive ‘employee listening architecture’, providing new insights about the employee experience as well as job progression, career mobility and performance.

Advanced analytics can now track and analyse a dizzying amount of employee data, including data harvested from voice communications, personal interactions and video interviews. Even the sentiment of employee emails can now be measured and monitored, with several vendors now offering organisational network analysis (ONA) software that interprets email traffic to monitor stress levels and help spot fraud, abuse and poor management.

Risk v reward

Analytics tools offer tremendous opportunities but, in the face of the benefits, many executives may be slow or reluctant to recognise the potential risks. Organisations are approaching a tipping point around the use of people data, and those that tilt too far could suffer severe employee, customer and public backlash.

Some organisations are now considering the mere existence of data to be a risk. This is behind requirements in the European Union under the new General Data Protection Regulation (GDPR), which came into effect in May 2018, requiring organisations to delete personal data immediately when no longer relevant. Companies that do not comply could face penalties as high as €20m or 4pc of annual turnover – creating strong incentives to take data protection seriously.

But what risks are most pressing in our 2018 survey? This year, 64pc reported that they are actively managing legal liability related to their organisations’ people data. 60pc said that they were concerned about employee perceptions of how their data is being used. However, with only a quarter reporting that their organisations were managing the impact of these risks on their consumer brand, fears over employee privacy appear justified.

Emerging concerns

Data security is a long-standing risk, but there are new risks as well. Some experts worry that algorithms and machine-based decisions could actually perpetuate bias due to flaws in the underlying data or algorithm itself. Understanding the potential for this type of risk is critical to preventing a new source of bias from seeping into an organisation’s hiring or promotion processes.

The marriage of people data and algorithm-based artificial intelligence (AI) raises such concerns to a new level. Just as people may never know why a certain advertisement pops up on their web browser, business leaders are beginning to realise that data-driven decisions are not guaranteed to be understandable, accurate or good….(More) (See also 2018 Global Human Capital Trends).