Does self-service really save time and money?
With the advent of the Internet, web-based access to enterprise software solutions ushered in a new era of business computing: Employee self-service.
This has led to both individual contributors and managers gaining ubiquitous desktop access to traditional back-office operational systems. And, thus, they are enlisted in entering data and processing business-related transactions in their day-to-day jobs.
This approach has become particularly prevalent in human resource-related areas. In most cases, individual employees actually have firsthand knowledge of the information or task to be completed, or they would have had to manually create paperwork to document the issue anyway.
The business case for organizations to adopt these solutions came from the time or cost savings that can be gained by offloading much of the data entry and transactional processing tasks from human resources or business administration.
The savings calculations are fairly straightforward. If an HR department, for example, has 10 people working 1,600 hours each year processing new hires, making an average annual salary of $60,000 a year, transferring half the workload of processing those hires to employees and managers involved would save the department 8,000 work hours.
If the positions were actually eliminated, it would save the company nearly a half-a-million dollars per year ($480,000).
At the same time, many organizations wanting to further streamline operations have established shared service organizations that centralize remaining back-office responsibilities and administrative tasks. Often, these teams are designed to operate alongside employee self-service software solutions, performing data entry quality assurance, help-desk and exception processing support tasks.
Some firms look to reduce costs even further by establishing those centres in countries with lower wage costs or by enlisting third-party outsourced service providers that could bring efficiencies through focused expertise and scale. Thus, the remaining work could be done for a fraction of the current labour cost.
While elegant in design, by and large, the employee experience of executing these strategies has not been excellent. Self-service adoption has not been immediate, user interfaces are often not intuitive and telephone trees to connect workers to appropriate staff are impractical and impersonal.
These disparate and disconnected systems and service centres have left many employees frustrated with the support they receive from their employers and with far less time to focus on meaningful work. And meaningful work — both for the business and for career development — is key to employee retention and engagement.
In addition, workers report being overwhelmed and isolated during events that involve any kind of complexity or uncertainty, such as role changes or relocations. Tasks and transactions, even within the same system, can seem cumbersome and irritating when changes to one piece of data or activity status do not cascade to effect changes in other parts of the system relying on the same data or person to execute or approve.
Remote service centre staff have typically been unable to understand these more complex issues. In the time and cost-savings calculations above, few firms asked themselves what happens to the 8,000 administrative hours — or, more precisely, where does that time go?
While automating data collection and processing does bring efficiencies to the work effort, most firms did not overtly plan for the 15 minutes here, 30 minutes there that self-service responsibilities brought the average employee.
Multiply this across not only HR functional areas but other business processes as well, such as booking travel, filing expenses, requisitioning new hires and supplies, approving invoices and accounts payable — it adds up.
The aggregate time the average employee spends — and particularly managers tasked with documenting approvals — can take hours every week. The interrelated roles and rules they invoke can easily lead workers exponentially astray from customer-driven business activities.
Take, for example, a global product manager who supports a $10-million line of business. If she spends 20 hours a month on administrative tasks and effectively has 1,600 productive hours per year to offer her employer (given average work hours in her region and paid time off benefits), she is sacrificing 15 per cent of her time on internal issues and work when she could be supporting customer requests, sales pricing analysis or supply chain partner inquiries and troubleshooting.
Now add in any event of complexity that involves the employee understanding policies, procedures, regulations, even external sources of information and capability, and self-service breaks down. That average one hour per day of administrative self-service can easily double.
Back in 1748, Benjamin Franklin published the adage “Remember that time is money” in his paper “Advice to a Young Tradesman, Written by an Old One.” At the time, Franklin was trying to educate a day labourer about the value of his time at work in addition to the costs of doing things other than productive work.
Economists now refer to this concept as “opportunity cost” — the calculation of lost value of a foregone option when someone chooses between mutually exclusive alternatives, given limited resources.
More than two-and-a-half centuries later, Franklin’s advice holds true for today’s worker as well, but while he was concerned about the costs of workers’ deliberate diversions or “idleness,” companies need to examine the cost of workers’ unproductive time in the workplace today.
Economists have been stumped since the last financial crisis as to what will raise workforce productivity and sustain business growth and expansion. Automation and outsourcing drove the last great wave of productivity — perhaps a more intelligent approach to workforce support services will drive the next.
Working hours and labour productivity in the modern era are complex topics, but the economic calculations around time can be relatively simple. What the workplace and workforce need today is new thinking and new tools to address a more productive employee experience.
It is time for companies to consider where they may find and support improved productivity and progress for their firms. Looking at the systems, services and staff they already have is the place to start.
Christa Degnan Manning is the founder and principal analyst of workforce support research firm Eudemonia in Boston. She can be reached at [email protected] or follow her on Twitter @ChristaDegnan. For more information, visit www.eudemonia.work.
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