THE RISE OF HR ANALYTICS: A PRELIMINARY

EXPLORATION
Dag Øivind Madsen, University College of Southeast Norway
Kåre Slåtten, University College of Southeast Norway

ABSTRACT

In recent years, HR analytics has risen greatly in popularity among practitioners and consultants in
the field of human resource management. To this date, however, HR analytics has not been subject to
much scrutiny from academic researchers. The aim of this paper is therefore to examine the rise of HR
analytics over the last few years through the theoretical lens of management fashion theory. This
theoretical lens places particular emphasis on how different supply-side actors involved in the human
resource management field have developed and positioned HR analytics as a necessary solution to
contemporary challenges.

JEL: M10

KEYWORDS: HR analytics, Human Resource Management, Management Fashion, Big Data

INTRODUCTION

The term “HR analytics” (HRA) has different meanings to different people (Bassi, 2011, p. 15). In a
recent article, HRA is defined as “the systematic identification and quantification of the people drivers
of business outcomes, with the purpose to make better decisions” (van den Heuvel & Bondarouk,
2016, p. 4). In other words, HRA is about analyzing human resource (HR) related data in a systematic
way to make better business decisions. HRA is currently one of the biggest buzzwords in the field of
human resource management (HRM). Commenting on the phenomenon of HRA, several authors have
noted that there currently is a lot of hype and buzz, and that it is generally seen as something
organizations “must have” (Platanou & Mäkelä, 2016; van den Heuvel & Bondarouk, 2016).
However, despite all of the buzz, academics have largely been absent from the debate and have only to
a very limited extent scrutinized the HRA phenomenon (van den Heuvel, 2016; van den Heuvel &
Bondarouk, 2016).

Against this background, the purpose of this paper is to examine more closely the rise of HRA, and to
explore how and why HRA in a relatively short period of time has gained this “must have” status in
the HR field. This paper uses management fashion theory (e.g. Abrahamson, 1996) as a theoretical
lens through which to view the popularity trajectory of HRA. In particular, this theoretical lens puts
emphasis on how different fashion-setting actors have developed and positioned HRA as a “must
have” solution to contemporary HR challenges.

To the best of the authors’ knowledge, management fashion theory has not previously been used in the
context of HRA. However, the management fashion perspective has been shown to have some
explanatory value in the context of other popular HR ideas and practices such as Talent Management
(Iles, Preece, & Chuai, 2010; Preece, Iles, & Chuai, 2011). In the broader HR literature, researchers
have pointed out that actors in the HR field are not immune to institutional pressures (Boselie et al.,
2009; Ewerlin & Süß, 2016; Gooderham, Nordhaug, & Ringdal, 1999; Paauwe & Boselie, 2003,
2007). As Paauwe and Boselie (2003, p. 64) note, fads, blueprints, and mimetic mechanisms are
influential in the HR field. In light of these findings, we argue that the management fashion could be a
promising theoretical lens to shed new light on the rise of the HRA phenomenon.

The paper proceeds as follows. Section 2 sets the stage by providing a brief historical overview of the
emergence and evolution of HRA, as well as a discussion of its relation to other ideas and practices in
the HR field. In Section 3 we briefly introduce the management fashion perspective, which will be

Electronic copy available at: https://ssrn.com/abstract=2896602

used to analyze the rise of HRA. In Section 4 we describe and analyze the roles and activities of
different supply-side actors involved in the HRA field. In Section 5 our findings about the rise of HRA
are discussed in light of management fashion theory. Finally, in Section 6 we conclude, discuss
limitations, and outline areas for future research on HRA.

HRA: EMERGENCE AND EVOLUTION

Although HRA only recently has become a big buzzword, HRA builds heavily on ideas and practices
that have existed in the HR field for a long time. As noted by Bassi (2011), metrics and measurements
were discussed as far back as the late 1970s. More than 30 years ago, HR researchers grappled with
issues related to the measurement of human resource management (Fitz-Enz, 1984). Although the
origins of the field of HRM can be traced back to Peter Drucker’s writings from the 1950s, HRM got
its big breakthrough during the mid-1980s (Beer, 2015; Kaufman, 2015; Marciano, 1995).

During the 1990s, the focus shifted to viewing people as a valuable organizational resource and
capability that can create competitive advantage (Barney & Wright, 1998; Huselid, 1995; Pfeffer,
1994; Ulrich, 1997; Ulrich & Lake, 1990; Wright, Dunford, & Snell, 2001). As a result, human and
intellectual capital became key buzzwords in both academic research and in the management
community at large (Edvinsson, 1997; Stewart, 1997; Ulrich, 1998).

In the years that followed, much attention was directed at developing new techniques for calculating
the return on human and intellectual capital (Bontis & Fitz-Enz, 2002; Fitz-Enz, 2000). During the
first half of the 2000s, new ideas such as HR Scorecards and Workforce Scorecards were developed
(Huselid, Becker, & Beatty, 2005; Ulrich & Beatty, 2001), tools that would allow organizations to
measure the impact of HR activities and practices on organizational performance. During the mid-
2000s, there were many calls for more scientific and evidence-based approaches to HR (Boudreau &
Ramstad, 2007; Pfeffer & Sutton, 2006; Rynes, Colbert, & Brown, 2002; Rynes, Giluk, & Brown,
2007).

In previous contributions, it has been noted that HRA has existed as a research topic for about 15 years
(Angrave, Charlwood, Kirkpatrick, Lawrence, & Stuart, 2016). In addition, HRA relatively early
become a topic of discussion in journals focusing on HR and people strategy (e.g. Feather, 2007; Fink,
2010; Levenson, 2005, 2011; Waber, 2013). In the last few years, HRA has received considerable
attention in influential practitioner-oriented management outlets such as Harvard Business Review,
and in a string of reports written by global consulting and technology giants.

The topic of HRA is currently the subject of much debate in the HR literature (Rasmussen & Ulrich,
2015; Ulrich & Dulebohn, 2015). Currently, a main focus of the research on HRA is how to use HRA
as a decision support tool predict future events, so-called “predictive analytics” (Fitz-Enz & John
Mattox, 2014; van den Heuvel & Bondarouk, 2016, p. 8). In addition, it is evident that the
profileration and availability of Big Data has paved the way for HRA, as much of the thinking around
HRA has been developed in the aftermath of the introduction of Big Data (Angrave et al., 2016). Big
Data makes it possible to use large amounts of data to support HR-related decision making processes
(Angrave et al., 2016; Shah, Irani, & Sharif, 2016).

A MANAGEMENT FASHION PERSPECTIVE ON HRA

In this paper, we take a management fashion perspective (e.g. Abrahamson, 1996; Kieser, 1997) on the
rise of HRA. A key focus of management fashion research is to understand why some management
concepts become popular, while others do not (Madsen & Stenheim, 2013). A management concept is,
in the words of Benders and Verlaar (2003, p. 757), a “more or less coherent, prescriptive vision on
(aspects of) organization design.” In the HR field, there are many examples of management concepts,
e.g. HR Scorecard (Becker, Huselid, & Ulrich, 2001), HR Transformation (Ulrich, Allen, Brockbank,
Younger, & Nyman, 2009), Performance Management (Smither & London, 2009) and Talent
Management (Michaels, Handfield-Jones, & Axelrod, 2001).

Electronic copy available at: https://ssrn.com/abstract=2896602

However, not all new HR management concepts end up as HR fashions. Jung and Kieser (2012, p.
329) suggest that management fashions are “management concepts that relatively speedily gain large
shares in the public management discourse.” In the management fashion literature it is pointed out that
the actors involved in the “management fashion arena” (Jung & Kieser, 2012; Klincewicz, 2006) play
key roles in the popularization and rise of management fashions. For example, supply-side actors (e.g.
consulting firms, technology firms and management gurus) create awareness and a wave of interest,
triggering bandwagon effects. In the next section, the focus will turn to the various actors involved in
the HRA field.

THE SUPPLY SIDE OF HRA

A wide range of supply-side actors are involved in the HRA field, e.g. consulting and technology
firms, management gurus, business school professors, conference organizers and professional
organizations. These actors offer various types of products and services aimed at helping potential
consumers of HRA (i.e. organizations and managers) implement and apply HRA in their
organizations. In the following, we will analyze the roles of several types of actors that we deem to
have been particularly influential in shaping the evolution and popularity trajectory of HRA: 1)
consulting firms, 2) technology firms, 3) professional organizations, 4) conference and seminar
organizers, 5) business media organizations, 6) business schools, 7) management gurus, and, finally,
8) social media.

Consulting firms

In the literature on management concepts and ideas, it is emphasized that consulting firms play key
roles in the diffusion and dissemination of new management concepts (Heusinkveld, 2013).
Management consulting firms have also had a strong involvement in the HRA field. During the last
few years, HRA has become an important practice area for most global management consulting firms,
and the concept is heavily marketed via these firms’ websites. Just in the last two or three years, a
number of reports have been published by leading consultancies such as McKinsey (Fecheyr-Lippens,
Schaninger, & Tanner, 2015), Boston Consulting Group (BCG, 2014), Accenture (Accenture, 2014),
KPMG (KPMG, 2015), and Deloitte (Deloitte, 2015, 2016).

Technology firms

Technology firms play important roles in creating software solutions for new management fashions, in
particular in relation to more technologically infused management concepts such as Knowledge
Management (Klincewicz, 2006) and Customer Relationship Management (Madsen & Johanson,
2016). As noted earlier, HRA draws on heavily on recent technological advances such as Big Data.
Therefore, it comes as little surprise that technology firms have played leading roles in the
development of the HRA field. In addition, technology firms are commercial actors who have sensed a
lucrative market opportunity in relation to HRA. After all, the market for HR related software is
massive, estimated at about $14 billion (Bersin, 2016a).

A number of well-known technology and software firms have developed software solutions for HRA
and people analytics. For example, firms such as Oracle, IBM and SAP offer solutions that help
generate statistics and overviews of a number of different HR processes (Angrave et al., 2016, p. 5). In
addition, Google has been heavily involved in the development of the HRA field (Bryant, 2011;
Sullivan, 2013), by introducing its people analytics function (Davenport, Harris, & Shapiro, 2010).

Professional organizations

Professional organizations have many functions in relation to new management concepts and ideas,
e.g. licensing, training, certification, and professional development. In addition, professional
organizations monitor and discipline the behavior of their members (Greenwood, Suddaby, & Hinings,
2002). Professional organizations shape what are seen as rational and legitimate management
practices. In the context of HR, it has been noted that professional organizations have a key function in
creating legitimacy for HR practices (Farndale & Brewster, 2005). Professional organizations have
also played an important role in relation to HRA. For example, local HR associations in countries such
as Norway (www.hrnorge.no), England (www.cipd.co.uk) and US (www.shrm.org) have placed HRA
high on their priority lists, e.g. by arranging conferences and meetings where HRA gurus and
spokesmen have been invited to speak and present their solutions.

Conference organizers

Conferences and seminars are important arenas where new popular management concepts are
introduced and discussed (Kieser, 1997). Usually other supply-side actors such as consulting firms,
management gurus and software firms actively partake in these conferences and seminars as speakers
and exhibitors. There has been a growth in the number of conferences related to HR and people
analytics, in addition to analytics-related streams at other more general HR conferences (Green, 2016).
It should be noted that several of these conferences have been co-hosted and/or sponsored by well-
known technology firms (e.g. IBM) or business schools (e.g. Wharton).

Business media

Different types of business media are influential in the diffusion of management concepts (Alvarez,
Mazza, & Pedersen, 2005; Sahlin-Andersson & Engwall, 2002). For example, management books
geared toward managers are influential in spreading new management ideas and practices (Furusten,
1999; Røvik, 2002). Just in the last few years, a large number of books about HRA have been
published (e.g. Bassi, Carpenter, & McMurrer, 2010; Davenport, Harris, & Morison, 2010; Fitz-Enz,
2010; Isson & Harriott, 2016; Sesil, 2013; Soundararajan & Singh, 2016).

Business schools

In the management fashion literature it is pointed out that business schools play an important role in
legitimizing and circulating new management concept and ideas (Sahlin-Andersson & Engwall, 2002),
by integrating them in courses and educational programs. The network around Harvard Business
School has played a role in legitimizing HRA. For example, articles have been published in Harvard
Business Review (Davenport, Harris, & Shapiro, 2010) as well as a special Harvard Business Review
Report (HBR, 2014). A number of business school professors have been involved in the propagation
of HRA, by publishing books and speaking at conferences.

Business school professors may also play a different role, by carrying out a due diligence function.
However, relatively few academics have scrutinized HRA from a critical outsider perspective. As
mentioned in the introduction, academics have largely been absent from the debate on HRA (van den
Heuvel, 2016; van den Heuvel & Bondarouk, 2016).

Management gurus

Management gurus are “thought leaders” that are influential in shaping the popularity of new
management ideas and practices (Huczynski, 1993; Jackson, 2001). In the broader HR field there are
many thinkers and gurus (HR Magazine, 2016). Jac Fitz-Enz may be considered the main guru in the
HRA field (www.drjacanalytics.com). However, other HR thinkers have also established a high profile
in relation to HRA.

In North America, one example is Josh Bersin, a principal at Bersin by Deloitte. Bersin frequently
contributes to the media discourse around HRA. For example, he has a Forbes column, as well as a
website (www.joshbersin.com) with commentary on HRA related issues (e.g. Bersin, 2016b). Bersin is
also active on social media platforms such as Twitter and YouTube. In Europe, Professor Nick Holley
at Henley Business School is frequently used by professional organizations as a speaker on HRA (e.g.
by HR Norge in Norway). Like Bersin, Holley is actively contributing to the discourse about HRA on
social media platforms such as Twitter. Next, we will turn to the role of social media in the rise of
HRA.

Social media

In recent years, the Internet and social media have emerged as important channels for the diffusion and
dissemination of new management concepts and ideas (Madsen & Slåtten, 2015). There is a number of
websites and online blogs about HR issues that are visited and read by HR professionals (Jensen-
Eriksen, 2016). Examples of important websites and blogs include HR.com, HRN Blog, and
GlobalHRU.com.

Social media platforms such as Twitter and LinkedIn have enabled much of the discourse about HRA.
Today there is a heavy presence of HRA actors on social media platforms such as LinkedIn, Twitter
and YouTube. On LinkedIn there is a number of relevant groups such as “HR Analytics”, “People
Analytics” and “Workforce Planning and Analytics.” Twitter has also become an important channel
for news and debate about HRA. A number of HRA spokesmen are actively tweeting using HRA
related hashtags (e.g. #HRanalytics, #PeopleAnalytics, #HRtech, #BigData). Finally, a search for “HR
analytics” on YouTube results in several thousand hits, and many of the videos feature the
aforementioned HRA gurus.

DISCUSSION

The brief historical review has shown that HRA has intellectual roots within the field of HR that date
back several decades. Measurements and metrics have a long history in the field of HR, and the recent
technological advances, such as the profileration and availability of Big Data have paved the way for
the development and popularization of new approaches such as HRA. However, some of the ideas and
practices associated with HRA are not new, which means that HRA, at least some extent, can be
considered a repackaging and relabeling of existing HRM practices using new rhetoric (cf. Legge,
2005).

It is clear that HRA in a relatively short period of time has risen to prominence in the HR community.
What may explain the widespread appeal of these new ideas? As Kieser (1997, p. 61) points out,
timing plays a key role in the popularization and rise of management concepts, as new concepts have
to hit the “nerve of today‘s managers.” Concepts that fit well with the current zeitgeist will stand a
greater chance of becoming fashionable. In this regard, HRA benefits from the strong position of the
evidence-based movement in the social sciences (see e.g. Rousseau, 2012; Young, Ashby, Boaz, &
Grayson, 2002) and the historical and ongoing quest within the field of HR to play a more important
and strategic role within the organization (Guest & King, 2004; Kaufman, 2014).

Therefore, an important question pertains to whether HRA can be considered a management fashion.
If we use the definition by Jung and Kieser (2012, p. 329), HR fits the definition of a management
fashion since it is a concept that quickly has gained large shares of public management discourse,
particularly in the HR sphere. The analysis of the supply-side of HRA has shown that a wide spectrum
of actors have been involved in the popularization and rise of HRA. In particular, consulting and
technology firms have spearheaded these efforts. There is also much discourse about HRA on the
conference scene and in management books. Similar to what has been seen in the case of Big Data
(Madsen & Stenheim, 2016), much of the discourse around HRA is taking place on social media
platforms. This is an indication that social media play an important role in the diffusion of
contemporary management fashions (Madsen & Slåtten, 2015).

Another issue pertains to the future popularity trajectory of HRA. Platanou and Mäkelä (2016) note
that the hype around HRA has been so strong that it currently is seen as something organizations
“must have.” In addition, these authors note that “the usefulness of big data and analytics in HR is
sometimes implicitly taken for granted” (Platanou & Mäkelä, 2016, p. 23). In other words, HRA
currently is viewed as legitimate and socially appropriate. The supply-side actors in the field of HRA
have contributed to the diffusion and institutionalization of HRA by carrying out what Perkmann and
Spicer (2008) label “institutional work” (e.g. publishing books, educating users, and creating user
networks).

It is difficult to speculate about the future popularity trajectory of HRA. However, judging by the hype
and rhetoric surrounding HRA, it is reasonable to assume that the expectations with respect to the
performance enhancing effects of HRA are currently very high. If the perceived effects should fall
short of the expectations, the result could be disillusionment among users. This could over time “wear
out” the HRA label (Benders & Van Veen, 2001). HR researchers have warned that the current wave
of interest in HRA may not be sustainable, and that it may wane. For example, Rasmussen and Ulrich
(2015) argue that it is important that HRA is grounded in real business challenges. Therefore, the HR
function needs be involved from the beginning and provide the rationale for gathering data and
conducting analyses. If not, there is a risk that organizations end up with large amounts of data that are
not really needed, and not used to solve actual organizational problems.

CONCLUSION

In this paper we have provided a needed critical examination of the HRA phenomenon, a concept that
van den Heuvel (2016) points out has not received much attention by HR researchers. Furthermore, we
have examined the rise of HRA using the management fashion theory as a theoretical backdrop.
Although this theoretical lens has been used in previous HR research, it has not been used specifically
in the context of HRA. In our view, the management fashion lens sheds new light on the rapid rise in
popularity of HRA. The analysis has shown that a number of supply-side actors have played
influential roles in the HRA field. In particular, the roles of consulting and technology firms stand out.
However, professional organizations have had a key role in legitimizing HRA in local markets.
Furthermore, the important role of social media in the popularization of HRA is also notable, and it
appears that the dissemination and diffusion of technologically infused management concepts such as
HRA and Big Data is increasingly happening online.

The approach taken in this paper has been explorative in nature. Therefore, our conclusions should be
viewed with a level of caution. First of all, we have only viewed the rise of HRA from a supply-side
perspective, and we do have any data about how and to what the extent HRA is used by actors on the
demand-side of the market. A follow-up study should combine both supply and demand perspectives
on HRA. Data about how and the extent to which HRA is used by actors on the demand-side could be
gathered using surveys and/or interviews.

Another limitation is related to our choice of management fashion as a theoretical lens. Viewing HRA
through the lens of management fashion does not mean that the authors are ruling out that adopting
and implementing HRA practices can have real effects. We recognize that if used to solve actual
organizational problems, HRA can be very useful (Rasmussen & Ulrich, 2015). In our view, the main
contribution of the fashion lens is that it puts the spotlight on the rise and fall in the popularity of
management concepts and ideas, as well as directing our attention to the field of actors involved in
diffusing and popularizing new management concepts and ideas.

Finally, in our study we have only taken a broad macro view of the rise of HRA at the international
level. In future studies, researchers could carry out detailed case studies of the popularity trajectory of
HRA in different countries or regions, which could involve tracking the activities of the actors
involved in national markets, e.g. local consulting firms, HRA gurus and HR associations.

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