Return On Investment

According to a recent survey by the research firm of Towers Perrin businesses using Web self services and knowledge based human resources tools have experienced a 100% improvement in timeliness, a 38% improvement in accuracy and reduced workloads by 50%. 

The following is an analysis of a 50 employee company

HR Services

Estimated Current Annual Admin. Cost

(Source)
Cost Elements 

Saving HR Time 
& Cost by 50% 
with HR PLUS		 Projected Savings
 HR: Compliance   $2,500   (DOL) 2 hr/ee/yr $1,250 $1,250
 HR: Employee Relations   $21,250

(SHRM) 17 hrs/ee/yr

$10,625 $10,625
 HR: Basic HR Training $2,500 (SHRM) 2 hrs/ee/yr     $1,250 $1,250

 HR: Orient & Enroll  

 $2,500

(SHRM) 2 hrs/ee/yr  

 $1,250 $1,250
 HR: Add'l HR Staff   $49,200

HR Clerks.+ (23% in benefits/taxes)

$24,600 $24,600
 Benefits:  Administration $1,250 (BLS) 1 hr/ee/yr $625 $625
 Payroll: Time Collection   $1,200

(Kronos) If manual,
$24-$48 /ee/yr

$600 $600
 Payroll: Processing   $4,800

(ADP, Paychex)
$96-138 /ee/yr

$4,800 $4,800
 Payroll: Tax Filing $500

(ADP) $10 /ee/yr

$500 $500
 Payroll: Reports $375

(ADP) $7.50 /ee/yr

$0 $0
 Payroll: National Work Comp  Adm.   $500

(AON) $10 /ee/yr

$0 $0
 Total Estimated Annual Costs

$91,875

   $45,500 $45,500 Saving
 Number of Employees  

50

   50 50
   

Annual HR PLUS Gold Service Fee

 $1,800 - $1,800 cost

Projected annual savings with the HR PLUS system installed   

$43,700 Net
 Annual Cost Per Employee $1,837.50   $36 $874.00 Saving
 Monthly Cost Per Employee   $153.12   $3 $72.83 Saving

A study that was conducted by the Aberdeen Group shows that:

"Benefits cost the American employers approximately $2 trillion yearly. Companies characteristically spend between $1,000 and $1,700 per employee, per year for HR administration alone."

A 1999 survey by The International Technology Group reported the following: 

"Among the organizations surveyed, the six most commonly reported self service applications were benefits administration, compensation changes, recruiting and staffing, training administration, employment verification, and maintenance of basic employee data. These represented average three-year savings of $123,507 per 1,000 employees for organizations employing multiple technologies. Additional savings were realized in some organizations through electronic pay-stub distribution and computer-based time and attendance reporting (respectively, $17,973 and $67,026 per 1,000 employees over a three-year period)."

The Hunter Group 2000 Human Resource Service Survey, which included 342 companies representing 6 million employees found: 

"Organizations continue to report success with their deployment of Human Resources self service capabilities. Over 90% report success in meeting their objectives. The results are compelling: 100% return on investment within a year; reduced headcount, transaction costs, and cycle time; and improved employee satisfaction."