This first myth deals with some views related to the economic viability of investing in HR system updates, new business process automation and overall systems implementations. In particular, this myth deals with the decision to deploy self-service portals that deliver HCM functionality.

If done wisely, HR employee self-service (ESS) and manager self-service (MSS) projects can provide some of the strongest ROI of any IT project. Based on industry research1, companies today can recognize an estimated savings of $1K annual per employee (a 10K employee company = $10M in annual expense savings going directly to the bottom line). This translates to a one year return on your initial investment based on industry validated assumptions.

Companies can further accelerate this ROI by leveraging their Microsoft® SharePoint® portal platform to access the SAP® HCM ESS / MSS transaction data. The financial justification for leveraging the SharePoint solution for SAP delivery is found through a number of improvements including rapid and accurate resolution of employee-initiated transactions, the elimination of manual processing, rapid application development and deployment, as well as less training.

Automating mundane HR tasks can eliminate the need to have armies of HR support personnel answering the phone from employees lost in the HR process maelstrom, freeing them up to focus on more strategic tasks or projects. And, because of the familiar and persistent usability features found in a SharePoint environment, overall user acceptance grows from a small percentage of users to near-universal adoption.

The key is to develop an in-depth financial analysis highlighting the projected hard-dollars savings, the impact on productivity and related financial metrics prior to moving ahead with an HR Self-Service portal implementation. Equally important is a comprehensive post-deployment analysis of the project to ensure those results are in fact realized.

HR Systems Drive Efficiency - Profit per Employee
The equation is simple - if profit per employee can be increased without increasing capital intensity, the overall profit (after paying for all factors of production – including depreciation) will increase. The net result – HR becomes more strategic focusing companies on intangible-intensive value propositions and, in turn, on talented people – those who, with some investment, can produce valuable intangibles (e.g. patentable ideas, innovative business processes).

HR Systems Increase Employee Satisfaction by Enhancing Shared Service Support
Deploying Employee Self-Service can dramatically reduce the amount of work across the board (Figure 1) especially in the HR Self-Service support area. HR personnel may be redeployed to pursue more strategic HR initiatives such as talent management and performance management.

So, what do you think? Are there other areas of economic return related to self-service? Post your opinions and let’s have a discussion. FYI, next Myth Monday we will cover

“Myth #2: Building an HR Portal is Easy!”