International Journal of Computer Science and Information Security (IJCSIS),
Vol. 14, No. 5, May 2016
(IJCSIS) International Journal of Computer Science and Information Security,
A Decision Making Model for Human Resource
Management in Organizations using Data Mining
and Predictive Analytics
Sujeet Narendra Mishra
Faculty of Computer Science and Engineering
Shri Ramswaroop Memorial University
Lucknow-Deva Road, India
Abstract The development of a decision-making model for
Human Resource Management (HRM) in organizations
especially for multinational companies can be encouraged
considering the fact that HRM plays a lead role in determining
the effectiveness of organizations endurance. The HRM
generally maintains evaluation practices and systems impelling
employee behavior, commitment, and performance. It is the
responsibility of the HRM to dig best talents around the world,
look after training, evaluate employee performance, give away
rewards and ultimately keep a right environment in the
company. As every strategy of an organization is totally or
somewhat related to the talents present, it becomes essential to
provide a framework that accurately predicts talent and
workforce. When human resource data is accessed for decision
making, different methods can be used to extract the best
knowledge out of available data. Data mining is widely
considered for extracting insights from data to make decisions
whereas predictive analytics is known for state-of-the-art
accuracy in decisions. The proposed model can be helpful in
improving effectiveness and efficiency of HR system that will
optimize business outcome. This paper is an attempt to provide a
decision-making framework for Human Resource related
decisions comprising data mining and predictive analytics.
Index Terms Data Mining, Decision Making, Human Resource
Management, Predictive Analytics, Talent Management
I. INTRODUCTION
Advancement in technology has boost HR functioning in
business organizations. They are now able to add more time to
strategic business decisions as automation on data handling has
provided better decision-making power to HR. Data mining has
been a reliable technology which gives a deeper understanding
of data for decision making. But a challenge associated with
HRM especially in terms of accurate decision making is worth
consideration. Data mining is often called Knowledge
Discovery in Data (KDD) which is believed to be a
combination of descriptive and predictive techniques. Even if
predictive techniques are referred as part of data mining due to
its similar nature, but the term prediction in data mining differs
broadly from predictive analytics as the later one focus on the
accuracy of prediction with better decision making. [1]
Combining data mining with the advanced predictive
techniques has enabled HR to understand and improve HRM
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Vol. 14, No. 5, May 2016
Dev Raghvendra Lama
Faculty of Computer Science and Engineering
Shri Ramswaroop Memorial University
Lucknow-Deva Road, India
functions; HR Predictive Analytics (HRPA) is one such
advancement. A hierarchy of analytics applied on HR data
such as descriptive, correlation, predictive and prescriptive
analytics combined together with HR metrics and advanced
machine learning techniques for decision making. [3] [4]
specifically, predictive models are prepared from insights of
mined data from human resource data collection. [5] In this
paper Section-I is an introduction, Section-II gives definitions
and concepts of HRM, data mining and predictive analytics,
Section-III describes Methodology, Section-IV are Discussions
on application of data mining and predictive analytics in HRM,
Section-V explains the components of Proposed framework,
Section-VI is the Concluding statements on future of decision
making in HR.
II. DEFINITIONS AND CONCEPTS
A. HRM
In any organization HRM plays an important role in strategy
making and are responsible for organizational decision making.
HRM manages workforce by keeping them satisfied and also
lifts work environment. The work includes assessment, hiring,
training and rewards for deserving employees at the right time.
HRM is believed to hire or retain best talents but often miss out
on them due to either loose recruitment policy or attrition.
B. Data Mining
Data Mining has gained a lot of significance in the society as it
helped to make prediction methodologies easier in various
fields. It is applied in almost all the fields like medical,
telecommunication, manufacturing, health care and customer
relationship apart from Human Resource fields. It may be
viewed as the extraction of patterns and models from observed
data or repositories. It is applied after data preprocessing i.e.
cleaning of data. Information has to be mined for intelligent
decision making from rich and colorful data warehouse. There
are six tasks covered under data mining; anomaly detection,
association, clustering, classification, regression, and
summarization. It is an important step ahead in the process of
predictive analytics.
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 International Journal of Computer Science and Information Security (IJCSIS),
Vol. 14, No. 5, May 2016
(IJCSIS) International Journal of Computer Science and Information Security,
Vol. 14, No. 5, May 2016

Data Collection

Identify Suitable Case

Apply Data Mining

Techniques

Record Data Insights

Prepare Predictive Model

Fig 1: Methodology

Some well-known software for data mining is Weka, SPSS,
SAS, Orange, RapidMiner, KNIME etc. [6]
C. Predictive Analytics
Predictive analytics can be referred as an analyst-guided
subject that studies data patterns to make forward-looking
predictions and can make complex statements by evaluating
various data patterns. If data mining quests for hints, predictive
analytics deliver answers that guide to what next action.
Whereas data mining techniques separate the highly valuable
data variables within a large dataset, the analyst uses these
variables and their patterns to provide a predictive model that
formulate the relationships and predict forthcoming behavior
consistently. [7] HR professionals boost their strategic
contribution with the help of advanced statistical techniques.
The predictive metrics are a byproduct of predictive insights
that enhances reports and dashboards. Predictive analytics
provide predictive solutions which can efficiently solve talent
management issues. [1] [4] [5]
III. METHODOLOGY
HR requires certain steps to identify data and apply decisive
techniques into the functioning of HR. The methodology is as
follows;
Step 1: Data Collection
A continuous collection of data in warehouse
pertaining to the human resource is maintained such
that it includes employee records, psychometric test,
and performance and business outcome results. HR
needs to make sure every important measure is
included in data records.
Data mining and predictive analytics techniques are automating
Step 2: Identify Suitable Cases
the process of decision making for various human resource
Variables list selected from data collection are
according to the need of data mining. [8] Correlation
based association rule is generated from data
warehouse by applying data mining techniques to
reduces dependent variables. [9]
Step 3: Apply Data Mining Techniques
Knowledge Management is essential for on time
predictions and has measurable benefits in
management decisions. C4.5 classifier technique has a
potential accuracy for talent management. [10] Better
decisions can also opt with other data mining
techniques such as J48, KNN and Apriori algorithms.
[11] [12]
Step 4: Record Data Insights
A collective experience is produced from mined data
in the form of records. These records are analyzed for
leveraging analytics on data. This step invokes value
from mined data by HRM.
Step 5: Prepare Predictive Model
A number of predictors combined to prepare a
predictive model from data insights which can either
be linear models or business intelligence rules. A
careful formulation of predictors derives result in the
form of a rank or a score, known as the predictive
score. This score is used for decision making. [5]
IV. DISCUSSION

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 International Journal of Computer Science and Information Security (IJCSIS),
Vol. 14, No. 5, May 2016
(IJCSIS) International Journal of Computer Science and Information Security,
functions. Some case analysis has been discussed here on the
impact of these techniques and their application in HRM.
These case studies are presented below;
A. Data Mining in HR
Employee Recruitment (Personnel Selection)
Hiring of employees can be subdivided into two parts
first being recruitment while next being selection.
Decision trees are a useful tool to explore data for
predictions in the form of rules. Classification and
regression tree (CART) algorithm is the most famous
method used in HRM for decision making on hiring.
[13] Other data mining techniques such as clustering
using fuzzy c-means and k-means algorithm are also
used for this purpose. A regression method is too
applied in data mining that removes dependent
variables and provides accuracy on performance
assessment. [14] [15]
Talent Management
Major data mining techniques for talent management
are classification, clustering, association and
prediction rules. Some classification algorithms i.e.
decision tree (C4.5, random forest), neural network
(multilayer perceptron, radial basis function) or
nearest neighbor (instance based learning) are applied
for prediction of potential talent for a specific task in
organizations. [16] Mining of talent can also be
integrated with information retrieval techniques for
processing text in resumes and filled forms. [17]
Employee Turnover Analysis
Decision trees, Logistic regression, and neural
network are the data mining techniques applied to
understand the problem of turnover. SAS institute has
developed SEMMA (Sample, Explore, Modify,
Model, and Assess) to create a classification of data
and allows application of statistical and visualization
techniques, to select and signify predictor variables, to
model predicting output and confirm the credibility of
the model. [18]
B. Predictive Analytics in HR
Employee Fight Risk Prediction by HP
Figure 2 presents the architecture of the proposed system
HP helped Global Business Services (GBS) to lower
aggregating four components in the model as follows;
down their attrition rate by application of predictive
analytics. A predictive model considering all the
1.
attrition factors zipped into one to calculate flight risk
scores. And the score on careful handling able to
reduce attrition rate by 5%. [19]
A report from SAS institute
Predictive analytics is equipped with relevant data
having volume, velocity, variety i.e. big data which in
turn is optimizing business outcomes. Enhancement in
computing power has enabled predictive models to
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Vol. 14, No. 5, May 2016
leverage complex statistical distribution allowing
more accurate predictions in marketing, management
and operations. Predictive analytics is offering
accurate decisions for human resource functions using
quantitative measures such as location, attendance,
age, and skill level for employee satisfaction and
retention. [20]
Oracle Fusion Workforce Predictions
Predictive analytics provides progressive insights into
workforce trends and help to predict performance and
attrition. Also, a What-If predictive model on cloud
improves performance and reduces attrition. The
blending of internal information with external
benchmarks and market indicators are done to provide
the statistical models to make highly accurate
predictions. [21]
Attrition Risk Prediction from
PricewaterhouseCoopers Human Resource System
(PWC-HRS)
A six-phase approach was applied to an organization
having 16,000 employees to predict attrition risks.
First was design phase where 75 hypotheses were
considered after that second phase was data extraction
in which predictors were chosen from data history.
Then 3 models were developed which then deployed
to produce a predictive score. 427 high-risk
employees were identified in next phase. The final
phase was redoing of this approach after every 6
months. [22]
A white Paper from Tata Consultancy Services
Predictive analytics is adapted only when the data
source is aligned with strategic business outcomes.
HR processes such as recruitment, workforce
management, performance management and risk
management are integrated to predictive analytics.
Key aspects of HRM like employee recruitment,
profiling and attrition are predicted with the help of
predictive scores. [23]
V. PROPOSED FRAMEWORK
Human Resource Data: Data acquisition and storage of
human resources information to a data warehouse. The
data is a continuous collection of records by Human
Resource Management and is extensively used for
decision making.
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 International Journal of Computer Science and Information Security (IJCSIS),
Vol. 14, No. 5, May 2016
(IJCSIS) International Journal of Computer Science and Information Security,
Data Mining
Human
Resource
Data
Data Insights
Fig 2: The Architecture of Proposed HR Decision System Model
2. Data Mining: Mining information to generate insights
from HR data and obtain knowledge after mapping of the
pattern through generated rules. Appropriate classification
and clustering techniques are applied, specifically decision
tree and neural networks which return insights of data with
high predictive accuracy.
3. Predictive model: It has two sub-components, first being
predictive analytic technique guided by an analyst to
formulate data insights in statistical form. Second being
predictive scores used for a range of decisions.
4. Predictive decision: Depending on ifelse based necessity
it is used for either immediate action or action in future.
Decisions are delivered after comparing predictive scores.
VI. CONCLUSION
Data mining and predictive analytics are much-needed
techniques for decision making for human resource
management in organizations. The application of modern
techniques provided better solutions to the existing limitations.
The ordering of components in the designed framework was
well chosen to complement existing system that relies on data
warehouse and mining. The framework if fully implemented
will enhance decision-making capability of HR. And also, it
will optimize the decision-making speed, provide reliability
and enhance organizational outcome.
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 International Journal of Computer Science and Information Security (IJCSIS),
Vol. 14, No. 5, May 2016
(IJCSIS) International Journal of Computer Science and Information Security,
Vol. 14, No. 5, May 2016
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