Cutting the cost of HR
Desperate times, not so desperate measures?
Because of the administrative nature of the HR role, HR department within many organisations is often seen as an overhead due to the fact that they don’t directly generate any revenue. This is especially true for Solicitors where some actually categorise their staff as Fee Earner or None Fee Earner.
Having said this, the HR department still plays and extremely important role with the organisation, but how can we maximise the return on investment for a department that costs the business money but doesn’t directly generate any income.
The key to an efficient HR department is how effective their processes are and having a HR Software system to manage this. No longer will a simple Personnel Software system, which just records basic information suffice. HR staff need a software system that can take away a great deal of the manual workload by automating many of the manual processes.
The biggest and most time consuming process in most companies is absence management. For many years most companies have had in place a paper based holiday booking system, whereby the Employee fills in a holiday form and gets their manager to authorise. This is then passed onto HR to record on their HR Software system. This process whilst sounding relatively straight forward is actually extremely time consuming and un-efficient.
An example of these savings can be demonstrated using the following example.
The People Inc Web Module (for 200 employees) when purchased with People Inc costs over 5 years around £6000. Based upon the figures in the tables below, the time saved over the same 5 year period by the People Inc Web Module equates to a whopping £28,118.67 (just on absence management alone).
Current Manual costs
Costs using People Inc Employee Self Service Module
Total Savings based on 100 employees
The other, not as obvious cost saving can be made by having the correct system in the first place, even if this means re-investing in a new system altogether. Many HR systems are quite expensive, even the cheaper products begin to get expensive when you start adding in additional modules such as recruitment, training management or Fleet for example.
Last year we formed a new partnership with P&A Group who provide People Inc. This was partly due to the fact that our previous supplier Vizual, decided to stop selling their long running HR systems, Personnel Manager and Personnel Director, but also because we saw an opportunity to provide customers with a more cost effective and complete HR software system.
People Inc is a perfect example of where companies can save a great deal of money, yet at the same time provide the tools to help the HR department be more efficient and cost effective.
Not only can companies save a great deal of time and money by implementing the Self Service Module to reduce costs of managing absence, but because People Inc has Recruitment, Absence Management, Training Management, Fleet Management etc built in as standard at no extra cost, that you can also save a great deal of money on Licensing and Support contracts.
For example, if your organisation has a system to manage Personnel Details and another to manage recruitment and yet another to manage absence or training or fleet etc, it is highly likely that you are paying for several licences for these systems, and also varying levels of annual maintenance fees.
Additionally, the need to invest in training on each different system means a great deal of ongoing cost of ownership for all the separate systems or modules.
Because People Inc has all of this functionality built in at no extra cost and because it stores this information securely in one central database, the cost of ownership is extremely low. Also, don’t let People Inc’s simple interface fool you. People Inc is as powerful as some of other HR systems without the massive costs and it even comes with a comprehensive screen designer tool, meaning you can invest small amounts of money into customising it to meet more of your business requirements, saving you more money in other departments within the organisation.
In these times of costs cutting, this is a perfect opportunity to review the cost of ownership of your existing systems and see how many ways a product such as People Inc can save you money.
Tags: AgathonHR, All-in-one, Cutting Costs, Employee Self Service, HR Software, Human Resources, People Inc, Personnel, Return on Investment, Software Licences
