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How algorithms help businesses improve workforce management


The growth of analytics-driven HR has been dramatic. Nowadays, there is an increasing demand from enterprises relying on algorithm-based HR decision-making to manage employees’ performance. As HR is facing a paradigm shift and moving towards a data-centric mindset and in HR, algorithms with proper design can solve the pain points of HR through a step-by-step method. So, what are algorithms?

An algorithm is a procedure or formula for solving a problem based on conducting a sequence of specified actions. Technically, computers use algorithms to list the detailed instructions for carrying out an operation. In terms of efficiency, various algorithms are able to accomplish operations or problem solving easily and quickly.

With the advancement in computing power and machine learning technologies, it is now possible to train a computer to learn from human decisions and build models to simulate them. Combining these models will give us more advanced algorithms that can mimic human instincts and propose actions not bounded by strict formulas.

The use of algorithms can be applied in human resources management, for example to improve attendance fraud and analyze data to locate irregular patterns by time, location, duration, task, employee characteristic, etc. Using algorithms to identify the root cause can minimize fake attendance and set up appropriate preventive policies. 

Another scenario of algorithm application is roster planning. With an HR system that is built with machine learning integration, HR can match staff planning with expense and revenue targets through common roster patterns with certain dimensions of a dataset, such as Public Holiday vs Location vs Goods Sold.  Relevance of data enables effective strategic planning to cope with business growth.

Starting a data-centric mindset is never an easy task. A quote from Laura Chapman, co-head of Freshfields’people and reward practice in Asia, “Businesses should find the right mix between people and technology to scale impact and accelerate growth, leveraging the power of technology while developing the human skill sets needed to inform decision-making.” provides an insight into how we should get along with algorithms. (Source: The Futurist: Managing People by Algorithms) There must be more than we expect to explore a proper use of algorithms in human resources management, not just a no-brainer but something more powerful in the near future.

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