In this morning’s discussion, we focused on how employee self service drives significant productivity gains from a bottoms up perspective. Now with our afternoon session we will take a look at how manager self service delivers similar levels of productivity gains.

Manager Productivity – Manual vs. ESS 1.0 vs. ESS 2.0
As mentioned previously, to get a handle on self service productivity, we take a look at the issue from a ‘bottoms-up’ approach starting with thinking about the specific business processes or transactions that a manager would initiate and complete. This transaction can take on a few characteristics like the frequency of the transaction (e.g. hourly, daily, weekly, monthly, quarterly, annually); the complexity of the transaction (e.g. time approval vs. pay increase approval; system processing such as read/write data - workflow); and the involvement of other employees and associated salaries/overhead, in the transaction (e.g. managers, employees, HR analysts, developers, support personnel).

To further help our understanding of the business value of HCM self service delivery, we’ll continue to use our example, ABC Corporation, a fictitious 30,000 person organization that we refer to throughout our mini-series here on “Driving Business Value”. In the case of ABC Corporation, we have 26K employees and 4K managers that make up the workforce. To help us get a handle on how ESS 2.0 helps to drive manager productivity we will take a look at transaction frequency by modeling high, medium and low frequency transactions.

Before we get started, an important word about manager approval delegation – the issue is this –> many managers find the process of approving time, or promoting an employee an onerous task in the manual or ESS 1.0 environment. Often times, these managers will delegate the responsibility for completing said tasks to their department’s administrators. With the advent of Sarbanes-Oxley this becomes an issue as SARBOX corporate compliance requires managers to adhere to strict policies as it relates to employee management. Managers are caught between SARBOX compliance, getting their work complete and spending more time than necessary in managing routine tasks such as approving time, promoting employees or managing annual benefits program enrollment. ESS 2.0 frees managers from this monotony by making these tasks quick, intuitive and extensively supported from a online help documentation perspective.

So let’s look at a high frequency manager transaction, say ‘time approval’, which is a process executed by managers on a nearly daily basis. In the 2.0 world, the corporate portal is up on the manager desktop all day and that manager remains signed in to the system throughout the work day. Each and every day – the manager can quickly click on the time entry approval app, review the time entered by the employees and cost centers for their activities without logging into completely separate systems to accomplish the task. Corporate Time Approval policies can be immediately posted to this screen making quick dissemination of new information easy, accurate and very targeted to the specific manager use case. Now compare this to the ‘1.0 World’ and you can immediately see that by having to deal with separate systems, log ins, and processes, you can rationalize a 20% time savings associated with this high frequency transaction – instead of say 10 minutes to accomplish this task you could get it done easily in less than 8 minutes. While this might not sound like much think about this - “2 minutes times 4K (managers) times 20 (working days per month) equals over 1,330 hours of saved time per month or at an average salary (fully loaded) of $75 per hour… or… nearly $100,000 that drops directly to the bottom line on a MONTHLY basis.

One quick word about transaction frequency is that you can really think of any daily (or every other day) online ESS transaction as a high frequency transaction – in other situations, a high frequency self service transaction may be approving purchase requests; or checking in on your group’s leave requests in your Time Approval system.

Now we can look at a medium frequency manager transaction, say ‘Onboard a New Hire’, a process probably executed on a monthly or quarterly basis (certainly slower in these economically challenging times). So we get the same advantage as the high frequency (e.g. single environment advantage of the 2.0 world) but we are also now dealing with the process knowledge support factor as we get into transaction complexity. Since this is more infrequent a manager probably loses context of how the transaction ‘works’. Leveraging ESS 2.0 integration technologies, the structured processes now are merged with unstructured support information (e.g. knowledgebase, policy documentation, training videos) whereby the manager can quickly ‘relearn’ the process and quickly & accurately complete said task thus rationalizing in our ABC Corporation example perhaps a 10-12.5% gain in time savings.

This same principle holds true for low frequency manager transactions, those that a manager may execute on a semi-annual or annual basis (e.g. promote an employee). The familiarity with transaction processing is very low, thus the ability of the ESS 2.0 environment to merge learning tools, supporting policies and help documentation, ease of use, single log in and links to external tools (e.g. Industry Wage Standards Calculators) helps to accelerate transaction completion time and accuracy thus freeing the manager to do more critical work (e.g. talent management, strategic planning). Again, we can estimate a conservative 20-25% gain in time savings.

The Bottom Line?

So with this information we can now model estimated manager savings since we have the necessary inputs to calculate total transactions and ultimate productivity gains in USD (e.g. # of managers – 4K; time savings associated with various transaction types; frequency of example transactions; estimated average salary and overhead for the majority of our managers).

With our total MSS transactions for ABC Company running close to 580K per year we can now estimate the time savings and then map this to our average cost per employee. In terms of employee productivity alone we can conservatively estimate nearly $2M per year in savings for ABC Corporation associated with ESS 2.0 oriented self service delivery for HCM.

Tomorrow Morning “How ESS 2.0 Drives Significant Savings in HR Shared Services Support Centers”