HR Strategy

How Manual Processes Cost You More Than Just Time

By

Lauren Rogers

| May 2, 2019

Let’s say that you need to take a weekend getaway. You want to get the best hotel rate, so you head over to the local library to find a business directory. After you write down the names and numbers of a dozen hotels, you step outside to start making inquiries.

You call each hotel on the list and ask about their rates, and if they have any specials, and let them know you’re not ready to book yet – you’re just comparing. Once you’ve amassed all that data on hotel rates, you select the best one and call back to book your stay.

Do you hear that record scratch?

While this might have been a savvy way to ensure the best deal on a hotel stay in the past, you can now take your pick of booking apps that will not only provide you information on pricing, but will allow you to see reviews from past customers. You might even bundle your plane ticket and your hotel room all in one fell swoop. When you’re done, you can forward your itinerary to anyone who needs to know.

When HR becomes hotel booking

For booking hotels, the manual process is slower than using an app, certainly. But you also miss out on a host of benefits, too. You’re spending more time by doing it the hard way, and getting less out of it.

Now, few people book hotels through manual processes anymore. There’s no need to, and the digital transformation has made the whole process quicker, more comprehensive and better in every way.

But too many companies still treat common HR-related activities – such as benefits enrollment, training, expense management and more – as if manual processes were enough to get the job done. In today’s competitive talent market, that’s simply not the case.

Manual processes slow your HR team and the rest of your employees down, keeping them from accomplishing more mission-critical work. They come with a tangible financial cost, as well. And it’s a lot more than most companies realize.

The business cost of manual processes …

Ernst & Young (EY) recently released a report detailing the financial cost for companies that don’t use fully automated self-service HR software. EY found that companies pay far more than necessary in two areas: duplicated tasks that occur when employees cannot enter their own HR information, and manual processes.

In this report, the average cost of a data entry for common HR tasks was $4.39 – and some HR tasks require several data entries! The average costs of some crucial HR tasks were much higher than that:

  • $17.89 to prepare and distribute training materials
  • $18.47 to obtain and provide information about benefits plan changes
  • $18.69 each time an HR representative had to calculate PTO balances and update an employee

For each of these three tasks, manual processes slow productivity and represent a labor expense that could be allocated more strategically.

These numbers become staggering once you consider how frequently these tasks happen. Check out these calculators to get an idea of what those costs might look like for your business.

With our new Direct Data Exchange, Paycom clients can get an even more accurate, real-time calculation of what it costs when HR or managers complete tasks employees can do on their own. Unique to HR software, this monitoring tool places a dollar amount on the cost of duplicated processes (based upon the Ernst & Young research) so employers know where to focus their efforts to reduce waste and increase ROI.

… and the opportunity cost

When HR and employees have to use manual processes for common HR tasks, you’re spending money for them to do something that could be automated, and taking them away from the critical work you need them to do. Similar to your requirements for timely and accurate expense submission or time tracking, consider mandating employees to use the HR technology in which you’ve invested.

HR could spend that extra time ensuring compliance, recruiting new hires or investing in your current workforce’s training to improve your competitiveness in the market. Other employees could be working to serve your customers better, create products more effectively or even close more sales.

It’s your call, really. Where would you rather allocate your labor expenses?

About the Author

Lauren Rogers

As a writer at Paycom, Lauren Rogers keeps employees abreast of company news and events, and provides insight to industry leaders regarding issues affecting human capital management. With experience in marketing and communications, Lauren has written blogs and other materials for a variety of businesses and nonprofits. Outside the office, she enjoys gardening, testing new recipes and sipping something caffeinated with her nose in a book.

See more posts by Lauren Rogers