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Is Your HR Department Productive, or Just Busy? HR Survey Results
Is Your HR Department Productive, or Just Busy? Executive Summary Administrative employees in the human resources (HR) department may seem extremely productive, but if their energy is spent manually entering data and concocting convoluted procedures to work around non-integrated HR software, then they’re really not as productive as you’d hope—they’re just busy. That’s why automating tasks like payroll and benefits administration must be done thoughtfully, with the goal of freeing staff and supervisors to spend their energy on more strategic (and truly productive) purposes. These efficiencies can allow HR leaders to take a larger role in the company and prove that they deserve a seat at the executive table. Types of Human Capital Management (HCM) Software at Respondents’ Companies An end-to-end system from one provider - 36% Don’t know - 8% 23% 36% 10% 23% 8% Too Much Time Spent on Administration, Data Entry Responses from a June 2015 Paychex survey of 150 HR professionals at the SHRM Annual Conference and Exposition indicated that administrative tasks and manual processes take an excessive amount of time in most HR departments. Small companies, in particular, may still have to write everything out on paper by hand. Survey respondents indicated that HR specialists have to spend nearly half their time (41 percent) in a typical workweek on tasks including administration (29 percent) and re-entering data from one system to another (12 percent). The remainder of their time is spent productively, by providing HR service and responding to employee needs. Only about a third of respondents (36 percent) said their company has a comprehensive human capital management (HCM) solution that supports hiring, HR management, benefits administration, and payroll and taxes from a single vendor. Comprehensive systems only require data to be entered once, because components share information. Other respondents indicated they have an end-to-end system with software from several providers, or use automation piecemeal for specific tasks. Such set-ups usually require entering the same data into the various programs. A surprising 23 percent of those surveyed said they still rely on paper-based HR administration. An end-to-end system from multiple providers - 23% Point solutions from various providers - 10% None, use manual systems - 23% Several reasons may account for companies’ lack of comprehensive human capital management (HCM) systems. Leaders at smaller firms may not realize that small-business solutions exist at affordable prices. Companies may lack the expertise to evaluate and adopt automated HR products. Others may resist technology altogether, preferring to stick to familiar manual methods. Most HR Professionals Recognize the Value of Automation Even if automation in HR departments is inadequate, partial or nonexistent, most professionals today recognize the imperative to adopt electronic systems. Survey respondents expressed interest in: • An HRIS – 35% • Recruiting and applicant tracking product – 37% • Time and attendance product – 30% • Payroll product – 33% • Benefits administration product – 26% • 401(k) record-keeping product – 14% • Another solution – 9% Others said that in the next 12 months they intended to buy: • An HRIS – 20% • Recruiting and applicant tracking product: 19% 1
Is Your HR Department Productive, or Just Busy? • Time and attendance product – 18% • Payroll product – 17% • Benefits administration product – 10% • 401(k) record-keeping product – 6% • Another solution – 2% Users of HRIS Give the Tool High Marks When we asked current HRIS users to describe the top benefits they get, responses were wide-ranging. Several broad themes surfaced: • “Accessibility” An HRIS is a single tool to manage labor, share information, and guide a company’s compliance with labor laws and regulations. Such a product is typically web-based, making it scalable and therefore attractive to even the smallest businesses. An HRIS’ capabilities usually include: • Broad data-sharing capacity, allowing users to easily share key organizational and personnel information; • Simplified benefits administration; • Improved employee training • Cloud-based data storage; and • Extensive reporting capabilities. Through the survey, 35 percent of respondents indicated they were interested in an HRIS, and 20 percent said they were ready to purchase such a tool. Other HR specialists listed specific automated functions that would benefit their companies, such as recruiting and applicant tracking, employee time and attendance records, payroll, benefits administration, and 401(k) plan administration,. Integrating HR functions in a single platform is the most cost-effective approach to automation, because it: • Reduces manual entry and administrative work across the board; • Ensures that all functions interact with one another; • Presents similar user interfaces and functionality for various tasks, which simplifies training; and • Requires only one vendor for training, support and upgrades. Respondents’ interest in HRIS and other computerized services seem to indicate a significant opportunity for vendors of HR software. “Employee self-service” “Everything in one place, one system” “Real-time access” • “Centralized” “Single sign-on” • “Comprehensive” “Controls all personnel files” “It offers many of the modules we require” “Tracking and training” “Cross-year reporting” • “Easy to use” “One-time administration, low cost” • “Time savings” There were also a few gripes. Ideally, these problems could be avoided with careful system selection and review of vendors: • “Runs smoothly except when you run into an issue. Impossible to get proper assistance.” • “Potential, if we knew how to use properly.” • “Not all-encompassing.” On the whole, HRIS represents a huge advance in efficiency for human resources administration. It enables the collection, tracking, storage and security of enormous amounts of data. It facilitates detailed record-keeping and reporting. It obviates the need to store large volumes of paper files and references. And it frees HR staff from a huge amount of clerical work. 2
Is Your HR Department Productive, or Just Busy? HR Software Solutions Have their Own Challenges Biggest Challenges or Frustrations with Current HCM System Technology’s Achilles heel, however, is the speed in which software becomes obsolete. A number of survey respondents who use automated HR tools indicated the need for revisions or updates. The complaint about too much data entry is vendorspecific; “other” gripes included difficulty creating reports, user unfriendliness, high administrative costs and lack of reliability. Such issues can be minimized by: This problem is compounded when a business has discrete systems for different functions. It may cause a company to endure nearly constant upgrades as one program or another comes due for revision—causing ongoing aggravation and slowing down work processes. • Researching products and vendors thoroughly; With HCM, the company can solve the never-ending loop of software upgrades arising from multiple systems and multiple vendors. These frustrations may be cured with the following benefits as mentioned by survey respondents: • Asking to “test drive” the system with your own data. • One vendor and one point of contact; • Talking with peer companies using HCM to learn their likes and dislikes; • Requesting on-site product demonstrations; and Biggest Challenges or Frustrations with Current HCM System • Price discounts for bundled products; • Common interface and functionality for all programs, facilitating employee training; • Programs that “talk” to one another for seamless data exchange and less data entry; • Upgrades that can occur at scheduled intervals for all programs; • Cloud-based data storage; • One customer service contact for all pieces of the package; and • Ability to manage costs with programs that interface and coordinate with one another. Function of your HR software most in need of revision Too much manual data entry - 24% System management too time-consuming - 14% Time and Attendance - 16% Current systems separate/in silos - 18% Using system effectively to manage costs - 5% Payroll Software - 14% Other - 28% Streamlining and automating planning - 11% Recruiting Software - 14% 3
Is Your HR Department Productive, or Just Busy? About the Survey • Utilities; and Our representatives surveyed 150 attendees of the 2015 Society for Human Resource Management (SHRM) Annual Conference, held in Las Vegas June 28 to July 1, to learn the activities that occupy their workdays and the tools they employ to do their jobs. Although the number of respondents is small for purely statistical purposes, the results are nevertheless revealing. • Wholesale trade. The majority of respondents (44 percent) worked in midsized firms of 100 to 299 employees. The next-largest segment came from small businesses of fewer than 100 workers. The remainder of survey-takers was evenly split (13 percent each) at companies of 500 to 1,000 employees or more than 1,000 employees. Paychex representatives staffing the corporate booth in the conference exhibit hall asked visitors to respond to a questionnaire on human resource systems. Participants included: Estimated number of employees in respondents’ companies • HR directors and managers; Fewer than 100: - 30% • Company presidents and chief executive officers; • Company vice presidents; • Other executives, such as chief financial officers, chief operating officers and chief information officers; • Payroll managers; 100-299 - 44% 30% 13% • Company directors; 44% 300-499 - 13% 500-1,000 - 13% 13% More than 1,000 - 0% • Controllers; • Board members; • Administrative assistants; and • Consultants. Survey takers represented a wide range of industries, such as: Respondents’ companies reported a wide range of annual revenue as well. Annual revenue of respondents’ companies • Business services; • Communications/Information technology; • Construction/Mining; • Consumer goods/Retail; • Discretionary consumer services; • Education; • Financial, legal and real estate; • Food/Beverage; Response Less than $1 million $1 million to $9.9 million $10 million to $24.9 million $25 million to $49.9 million $50 million to $99.9 million $100 million to $499.0 million $500 million to $999.9 million $1 billion or more Don’t know Chart Percentage Count 5% 13% 16% 16% 10% 14% 4% 4% 18% 7 20 24 23 15 21 6 6 27 Total Responses 149 • Government; • Manufacturing; • Medical/Healthcare/Pharmaceutical; • Science/Technology; • Sporting goods/Travel/Amusement; The majority of survey participants (82 percent) indicated they had at least some role in the purchase of an automated human capital-management system for their company. • Transportation; 4
Conclusion Paychex FlexSM Small and midsized companies in any industry may turn busy workers into truly productive employees with a human resource information system (HRIS) to automate labor- and data-intensive functions, such as benefits, payroll, and reporting. Paychex Flex delivers the most comprehensive, end-toend technology suite available that puts your people at its core. Built on a single platform, employees have a single data profile that ensures real-time accuracy from recruiting through retirement. It’s all backed by more than 40 years of Paychex stability and innovation—including nearly 20 years in the mid-market space—and supported by our unrivaled, flexible service model that can grow and change with your business. Responses to a survey taken by 150 attendees at the 2015 SHRM Annual Conference indicated that administrative tasks and manual processes occupy an inordinate amount of time in most HR departments. Small companies may still rely on laborious paper-based methods. A single system from a single vendor enables data transfer among all functions, streamlining data entry. Program updates are simplified and synchronized, unlike upgrades to separate systems used for discrete functions. An HCM system can represent a cost-effective solution for myriad complex HR functions. With the time savings gained from incorporating an HRIS into an HCM system, human resource staff can devote their energies to strategic work. Where Can I Find Out More? When you’re ready to learn more about leveraging HCM for your business, you’re invited to peruse our informative HR articles. About Paychex Paychex, Inc. is a leading provider of integrated human capital management solutions for payroll, HR, retirement, and insurance services. By combining its innovative software-as-a-service technology and mobility platform with dedicated, personal service, Paychex empowers small- and medium-sized business owners to focus on the growth and management of their business. Backed by more than 40 years of industry expertise, Paychex serves approximately 590,000 payroll clients across 100 locations and pays one out of every 15 American private sector employees. Learn more about Paychex by visiting www. paychex.com, and stay connected on Twitter (twitter.com/ paychex) and LinkedIn (linkedin.com/company/paychex). The information in this paper is furnished for informational use only and should not be construed as a commitment by Paychex, Inc. Paychex provides such information as a service and is not implying its endorsement of, or agreement with, such opinions, information, analyses, recommendations, or conclusions. If legal advice or other expert assistance is required, the services of a competent professional should be sought. Contact Paychex To find out more about the cloud-based Paychex FlexSM system and what it can offer your business, please call 855-973-2460, or visit payx.me/productive. © 2015, Paychex, Inc. Paychex, Inc. 911 Panorama Trail South Rochester, New York 14625 800-322-7292 www.paychex.com