“We Have No Data on That” - Why HR Leaders Are Still Flying Blind in 2025
I’m still floored by how many HR and operations executives at globally recognized companies - yes, the ones we’ve all heard of - are still making talent decisions based on vibes, not verified data. Don’t get me wrong, intuition is EXTREMELY important – but if you don’t have real measurement that verifies the intuition, how do you improve?
Over the past several months, I’ve spoken with so many senior leaders who admit they can’t answer basic questions like:
- “What’s your quality-of-hire score, and how do you track it?”
- “How long does it take for a new hire to reach full productivity?”
- “What’s your first-year attrition rate by team?”
The answer, more often than not, is “We’re working on it.” Meanwhile, these same companies are hemorrhaging talent, misfiring on hiring decisions, and wondering why their engagement scores are in freefall.
Let’s break down why this is happening and talk through some possible solutions.
The Hidden Cost of Ignoring HR Data
Let’s start with the elephant in the room: bad hires. According to the U.S. Department of Labor, a bad hire can cost your business 30% of a first-year salary, and up to 50% for leadership roles – real, measurable dollars. That’s not just a rounding error, it’s a budget line item.
But the damage doesn’t stop there. Bad hires can lead to:
- Drag on Team Momentum: One under performer can derail a high-functioning team. Instead of focusing on strategic goals, top performers are forced to pick up the slack or navigate miscommunications that slow everything down.
- Customer Impact: When a misaligned hire is placed in a client-facing role, the damage can be immediate and public. Missed deadlines, unimpressive deliverables, or poor communication can turn loyal clients into skeptics.
- Manager Burnout: Leaders spend excessive time coaching or correcting poor hires instead of developing high-potential talent. It’s a silent killer of productivity, not to mention morale.
- Cultural Contamination: A single employee with a toxic attitude or chronic disengagement can disrupt team chemistry. Even worse, it signals to others that mediocrity is acceptable, which could lead to cultural erosion.
And yet, many organizations still aren’t tracking the metrics that could prevent these issues.
Quality of Hire: The Metric Everyone Talks About but Few Measure
Quality of hire is often hailed as the “holy grail” of recruiting metrics. It’s a composite score that can include:
Performance Appraisal Scores, Retention Rates, 360-Degree Feedback, Error Rates in Performance. Yet, a significant number of organizations fail to measure it effectively. Without this data, companies are essentially hiring in the dark, relying on gut feelings alone, rather than
combining intuition with evidence-based assessments.
Retention Rates: The Canary in the Coal Mine
Employee retention is a critical indicator of organizational health. High turnover rates can signal deeper issues such as poor management, lack of career development opportunities, or cultural
misalignment. Yet, many companies fail to analyze retention data effectively, leading to:
Increased Recruitment Costs, Loss of Institutional Knowledge, Decreased Employee Morale. Implementing robust retention analytics can help identify at-risk employees and inform strategies to improve engagement and satisfaction.
Real-World Success Stories: The Power of HR Analytics
Several organizations have successfully leveraged HR analytics to drive significant improvements:
Clarks: Enhancing Employee Engagement to Boost Business Performance
Challenge: While Clarks already had relatively high levels of employee engagement, the company aimed to maximize return on investment, particularly at the store level.
Approach: The HR analytics team analyzed 450 data points to understand the relationship between employee engagement and overall business performance. They also collected additional data from the company's 100 best-performing stores.
Findings: The analysis revealed that for every 1% increase in employee engagement, business performance increased by 0.4%.
Outcome: Based on these insights, Clarks implemented several initiatives, including a store management development program and an employee engagement toolkit for managers, leading to improved engagement and increased business performance.
E.ON: Reducing Absenteeism Through Data-Driven Vacation Policies
Challenge: E.ON wanted to understand the factors influencing employee absenteeism to implement interventions.
Approach: The HR analytics team formulated 55 scenarios related to absenteeism and tested them using available data.
Findings: The analysis revealed that the duration and timing of vacations had the most significant impact on unplanned time off. Contrary to popular belief, employees selling back their vacation time did not significantly affect absenteeism rates.
Outcome: E.ON adjusted its vacation policies to encourage employees to take multiple breaks throughout the year, including at least one longer vacation, leading to reduced absenteeism.
Johnson & Johnson: Rethinking Hiring Practices to Improve Retention
Challenge: The company wanted to improve employee performance and retention.
Approach: The HR and people analytics team analyzed data on 47,000 employees to assess the link between prior job experience and turnover.
Findings: Contrary to initial assumptions, employees hired directly from college remained with the company significantly longer than those with prior industry experience, with no significant
difference in performance.
Outcome: Johnson & Johnson increased hires of new graduates by 20%, effectively reducing turnover while maintaining performance levels.
These case studies demonstrate the tangible benefits of adopting data-driven HR strategies.
Actionable Steps to Embrace HR Analytics
To avoid falling behind, organizations should consider the following steps:
- Invest in HR: Implement platforms that can collect and analyze HR data effectively and hire internal or external support to drive insights from this data.
- Train HR Professionals: Equip your existing HR team with the skills needed to interpret data and make informed decisions.
- Establish Clear Metrics: Define what success looks like in terms of hiring, productivity, and retention.
- Regularly Review Data: Make data analysis a routine part of HR processes to identify trends and areas for improvement.
- Align HR and Business Goals: Ensure that HR analytics align with broader organizational objectives to drive strategic outcomes.
Conclusion: Data-Driven HR is No Longer Optional
In an era where data drives decision-making across all business functions, HR cannot afford to lag behind. By embracing HR analytics, organizations can make informed decisions that enhance hiring practices, boost productivity, and improve employee retention.
The question is no longer whether to adopt HR analytics, but how quickly you can implement these strategies to stay competitive in the modern business landscape.
If you'd like assistance in developing a tailored HR analytics strategy for your organization, feel free to reach out. Let's turn your Hiring data into a powerful tool for transformation.