Ever played with a Magic 8 Ball? You'd ask it a question, give it a shake, and voilà, you had your answer. If you didn’t like it? Shake again. A fun party trick, but hardly the foundation for strategic decision-making.
Today’s HR leaders and businesses need more than luck and guesswork. They need data-driven insights to anticipate challenges and plan for the future. Two key techniques helping organizations move beyond the realm of chance are forecasting and predictive analytics. Though they sound similar, they serve distinct purposes. And together, they’re a powerhouse combination. Let’s dive into what each approach offers and why both are essential.
Forecasting, at its core, is about extending historical trends into the future based on known data. It’s a statistical process that estimates future outcomes using past and present information, no guessing allowed.
In HR, forecasting is used to predict metrics like future headcount, turnover rates, or the need for new hires. It builds on patterns already visible in historical data, projecting them forward in time to help leaders plan strategically.
For example, by analyzing trends from the last three years, you might forecast your organization’s attrition rate for the next six months. This helps with resource planning, budgeting, and setting realistic expectations for the business.
In One Model’s One AI, forecasting is seamlessly embedded into storyboards. With a click, users can extend trends forward and visualize future states. Behind the scenes, One AI uses techniques like ARIMA, Curve Fit, or Prophet (depending on your data’s characteristics) to build highly configurable forecasts. Whether you're predicting headcount or engagement trends, One AI ensures you're working with a rigorous, statistically sound projection, not a hopeful guess.
One key feature: forecasts include confidence intervals. These are shaded areas that represent the range within which the forecasted values are expected to fall. This equips HR teams to not just plan for a likely future, but to prepare for a range of potential outcomes.
While forecasting projects trends forward, predictive analytics digs deeper to uncover why future events might occur. It analyzes historical and current data to identify patterns and relationships, predicting not just what could happen, but offering insights into the underlying drivers.
In HR, predictive analytics might help you anticipate which employees are most likely to resign or which candidates are most likely to succeed. Instead of simply showing that turnover might increase, predictive models can point to the factors driving that trend, like low engagement scores, lack of career progression, or team instability.
With One AI, predictive analytics is taken a step further with explainability and transparency. One AI’s models provide not only predictions but also detailed explanations through techniques like SHAP values and feature importance scores . This ensures HR teams can understand the "why" behind each prediction, enabling trust and actionable insights. For instance, rather than offering a black-box prediction, One AI will tell you that tenure, performance ratings, or recent changes in team structure are key risk indicators for turnover.
One AI ensures that predictive models are auditable and defendable, critical in today’s regulatory landscape. No hidden magic, just transparent, responsible AI.
You might wonder, do you really need both forecasting and predictive analytics?
The short answer: absolutely.
Forecasting provides the big picture. It tells you where the ship is headed if current trends continue. It’s crucial for setting budgets, workforce planning, and managing executive expectations.
Predictive analytics provides the why behind the trends. It flags risks and uncovers opportunities, helping you to take corrective actions before issues become crises.
Forecasting shows that your organization's attrition rate will spike in Q4. Predictive analytics digs in and reveals that the employees most likely to leave are those without recent promotions or learning opportunities. Now you’re not just bracing for impact, you’re adjusting course.
Together, these approaches offer strategic foresight and targeted interventions. Forecasting prepares you for what’s ahead; predictive analytics empowers you to change the outcome.
At One Model, we’ve built One AI to empower HR and business leaders with both forecasting and predictive analytics in one platform. Here’s what sets it apart:
Before you trust the predictions, understand the data. Watch One Model's Hayley Bresina and David Poe break it down in this insightful on-demand video walkthrough.
Predicting the future isn’t about crystal balls or Magic 8 Balls anymore. It's about leveraging your data intelligently. Forecasting and predictive analytics are two sides of the same coin, both vital for building resilient, future-ready organizations.
With One AI, you can have both forecasts to set your course and predictive insights to steer it wisely.
Curious how forecasting and predictive analytics work in One AI? We can help you figure it out and get started.
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One Model’s People Analytics solutions help thriving companies make consistently great talent decisions at all levels of the organization. Large and rapidly-growing companies rely on our People Analytics platform and One AI because they takes all of the heavy lifting out of data extraction, cleansing, modeling, analytics, and reporting of enterprise workforce data.